AI Driving Business Transformation in Retail

Retailers are using technology to transform the shopping experience as consumers develop new shopping habits accelerated by the recent pandemic.

A recent Microsoft study showed that 72% of consumers only engage in personalized marketing, 75% of consumers report new shopping behavior, and 75% of apparel, hard goods, and specialty retailers intend to offer two-day or same-day delivery.

How AI in Retail is Shaping the Industry

Elevate the Shopping Experience

Shoppers and retail customers are expecting more from their favorite shops and brands. Some didn’t disappoint with new technology blurring the line between digital and physical shopping. Imagine browsing products on your phone and knowing exactly where you can find the items you showed interest in when you’re in the store. Or getting an email or push notification about the products you tried in-store so you can do the next step and buy them online.

Recommendation engines are extremely helpful in carrying out the personalization and custom experiences of the customers. Providing real-time data and insights through IoT, AI, and machine learning.


AI-driven personalization is one of the main tools of retail marketers to drive business growth across different sales channels accounting for 54% of the industry. By adopting AI, 30% of them outsells their counterpart. This is because 80% of consumers are most likely to purchase when a brand offers a personalized experience.

Supply Chain

Build Real-time Sustainable Supply Chain

Demand forecasting is an essential part of the retail business. In the same Microsoft study, 70% of retailers indicate AI and ML as top technology choices for forecasting and demand planning, and all for good reasons. The use of both platforms improved forecasting accuracy to 93% and reducing inventory by 30% through a demand-driven supply chain. Freeing up capital for other investments and improving cash flow. With real-time data from stores and insights from consumers, competitors, trends, marketplace forecasts, and industry shifts retailers are in a better position to forecast demand and ensure a sufficient and efficient supply chain for all stores.

Empower the Store Associate.

Artificial Intelligence and Machine Learning are empowering associates by helping with automation and workflow efficiency. Giving them more time and opportunity to utilize their skills and energy for other priorities, innovate and engage with customers.  These technologies are critical as well in ensuring safety not just of the people but assets too.

Driving and Maximising Value of Data

With the amount of customer information available across different channels, retailers have the opportunity to maximize data to have an additional revenue stream for the company and offer value-added services to the customer.

Take Amazon, for example, it’s using the same retail channel to earn from advertising but the customers are also benefitting from the platform by getting product recommendations that may be of necessity or interest to them.

Artificial Intelligence (AI) in retail as well as Machine Learning provide a lot of potentials for retailers to improve revenue, customer service, efficiency, and security for retail businesses.


If you are looking to start an AI or ML project, contact us at AI Consulting Group to find ROI-based opportunities that will be applicable no matter where you are in your AI-adoption stage.

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