Retailer roundtable part 5: How natural health retailers are adapting to market shifts and innovating to stay competitive
By Vibha Shukla
Following a successful debut at CHFA NOW Vancouver in 2024, the Retailer Roundtable—hosted by Bruce W. Cole, founder of CNHR—returned to the 2025 trade show and was met with an overwhelmingly positive response from retailers.
At the 2025 CHFA NOW show, retailers were encouraged to participate and share their experiences in an idea exchange during a retailer roundtable.
Attending retailers were split into five groups, and each group was asked a question about the following pressing issues impacting the natural health retail industry: navigating tariffs and supply chain challenges; enhancing customer experience to drive sales; building and motivating high-performing teams; creating collaborative partnerships to boost growth; and innovating and adapting in a changing market.
In this fifth (and final) part of the roundtable series from 2025, we’ll share insights from retailers about adapting to market shifts and innovating to stay competitive to future-proof your business.
Partnering with technology
Over the past few issues, we’ve talked about the various challenges that retailers have faced recently—from the lingering impact of COVID-19 to the instability brought on by tariffs. These challenges have forced retailers to stay nimble and be prepared to make changes within the business to keep it going. And one of the most important tools to emerge as a partner for natural health retailers is AI, which can help retailers elevate customer experience and operational efficiency.
Retailers at the roundtable discussed how AI may support the natural health sector over the next few years. AI has been increasingly used in retail for analyzing market trends and customer data, helping retailers map purchasing patterns and prepare for shifts in demand. According to a 2024 report published by SAP, AI use within the retail sector will grow from US ~$12 billion to US~$55 billion by 2033. Roundtable retailers pointed out that while AI use is growing, its effective use depends on careful implementation, managing costs, selecting the right AI partner, and establishing clear checks and balances around AI outputs. For natural health retailers, validating AI-generated data is not just best practice; it is vital for accurate, actionable business planning. To fully rely on these tools, retailers must understand exactly how those insights are generated.
Matthew Penner from Community Natural Foods added that natural health retailers should be “looking at predictive models for purchasing, so not just a replenishment model where you’re saying, ‘This is how many I need to order to keep on the shelf,’ but actually looking at what’s selling [and] what general trends look like over the past few months or previous years.” This allows retailers to make informed decisions regarding their inventory, improves responsiveness to customer demand, and reduces reactive ordering practices.
To learn more about how to effectively use AI for your business, check out cnhr.ca/industry-news/ten-smart-ways-to-use-ai-for-your-business.
Reframing value
Another major topic was the evolving relationship between e-commerce and brick-and-mortar. Retailers talked about how in some regions “the market is coming down and e-commerce is dominating.” However, pricing expectations, shopping behaviours, and customer experience varied widely depending on geography and consumer preferences. This has implications on product strategy. Retailers revealed that, as consumer preferences evolve, certain products become routine purchases. “Is this a commodity product that has now become a routine purchase that the customers are now concerned about price?” In such cases, e-commerce may have a competitive edge. However, retailers brought up the enduring value of brick-and-mortar stores and suggested mitigating this by continuing to offer something that e-commerce cannot replicate—personalized guidance and lasting relationships.
According to Forbes Business Development Council, employees are the face of your organization and have a direct impact on the company’s success. And retailers agreed that employees play a critical role in shaping the customer experience and promoting new products.
Matthew mentioned that the group concluded that stores could position themselves as destinations for “the new, the innovative, the exciting” by hiring staff who are excited about pitching and selling new products. While staple products bring revenue, unique and emerging items bring customers and differentiate natural health retailers from larger competitors.
Incentivizing customers
The final thread in the discussion on market shifts focused on customer loyalty. Retailers emphasized that the enduring strength of health food stores lies in their ability to consistently exceed customer expectations. In this increasingly competitive marketplace, natural health stores have retained and drawn in customers by refusing to compromise on experience. As Matthew noted, customers walk into a natural health store with a clear expectation: they will receive personalized, knowledgeable guidance alongside high-quality, carefully curated products. That trust, built over time through meaningful interactions and expertise, continues to set the channel apart and keep customers coming back.
Loyalty programs that go beyond product discounts were highlighted as a key tool. Matthew explained that loyalty programs must include both tangible benefits such as savings and intangible benefits such as trust and personalized service. “How you’re motivating your customer to come back, how you’re investing in each of those customers, and how you’re ensuring that they know you’re a partner for them and that they know they’re going to get a significant experience with you make all the difference.” This blend of value and connection reinforces why customers choose natural health food stores, underscoring that long-term loyalty is built on trust, expertise, and a differentiated in-store experience.
Looking ahead, participants of the roundtable agreed that maintaining this balance is critical as competition intensifies and consumer expectations continue to evolve. Retailers must remain agile and use AI and data insights to better understand their customers while preserving the human connection that defines this industry. By balancing innovation and service, retailers can continue to strengthen loyalty and ensure that they remain essential wellness destinations for their communities.