By Jill Standish
As the AI revolution accelerates, it’s rewriting the rules of customer engagement, retail operations and workforce management — all at the same time.
The rapid pace and extensive scope of change are presenting significant opportunities for retailers of all sizes to gain a competitive advantage. But there’s no time for delay. According to Accenture’s latest Pulse of Change survey, C-Suite retail executives understand the importance of tapping the power of AI, especially generative (gen AI), arguably the most transformative technology of our generation. Nearly all (84%) are planning to increase their investment in gen AI in the year ahead.
With so many decisions to make, and so many changes and headwinds to navigate, where should retail leaders direct time, resources and investments?
Here are six routes to consider.
• Double down on your brand — The fact that consumers expect smarter, more personalized shopping is not new. Now, with gen AI, more and more people are starting their searches with AI-driven recommendations and chatbots rather than search engines.
What does this mean for retailers? It means they must optimize their brand presence for AI-driven discovery. Because if your products aren’t appearing in AI-generated recommendations, somebody else’s will be. And while there’s plenty of unmet need to play for, 75% of consumers still want their needs to be met more quickly and easily.
Just consider how a retailer could create AI-powered shopping assistants to help customers find products that best match their unique set of needs in each moment. This could include checking information on ingredients or whether a product has been ethically sourced. Retailers can use large language models (LLMs) to offer up summaries, comparisons and even product reviews to enhance the overall shopping experience.
• Adapt instantly to demand with live data and insights — Retailers have an opportunity to fundamentally rethink operations using data and AI. For instance, they can finally break down functional silos and replace them with more agile networks supplying insights in real time.
Responsive merchandising is a good place to start. Through using advanced analytics, retailers can anticipate trends in close to real time. They can then quickly adjust and curate product assortments, layouts and pricing tailored to the local market and, ultimately, boost sales and enhance customer satisfaction.
While some retailers are already laying the groundwork for these shifts by launching highly localized small concept stores more closely aligned with nearby consumers, 60% of companies aren’t using real-time customer interaction data to predict customer preference, so there is still work to be done.
• Personalized and personable marketing — Customer trust and loyalty are becoming increasingly important in retail. AI interfaces represent a new type of interaction where retailers can affect this trust. For example, nearly four in five shoppers now believe conversational AI should retain their preferences from previous interactions.
The challenge? 60% of companies still aren’t using real-time data to predict and guide customer interactions. That’s why it’s imperative to double down on delivering seamless personalization across all potential touchpoints.
• Develop exceptional in-store experiences — Physical shopping continues to be an important aspect of retail strategies. With the advent of AI, retailers have the opportunity to utilize intelligent technologies to further localize and personalize in-store shopping. This can lead to enhanced experiences and stronger community connections.
“Fun” can be a powerful concept here. Accenture’s research shows over three-quarters of consumers who have fun while shopping are likely to recommend a brand to others. Advanced retail tech can support new kinds of fun and engaging experiences while simultaneously reducing the cost to serve.
• Build agile supply chains — Supply chains must be resilient, transparent and efficient. It is estimated that businesses miss out on approximately $1.6 trillion in revenue growth opportunities every year due to supply chain vulnerability. Real-time data and AI are essential tools for optimizing logistics, increasing resilience and improving inventory management.
• Empower employees with AI — Then there’s the impact AI is having on the retail workforce. Accenture’s research indicates that recent developments in artificial intelligence have the potential to affect half of all retail working hours. This shift emphasizes the importance of data-driven decision making, customer engagement, and the management of AI tools and agents.
Retailers are investing in training their staff in AI, but only 27% of retail and consumer goods workers report understanding the value of the technology. Therefore, it is important to continue focusing on upskilling to enable effective use of new AI solutions.
The time to act is now
The transformation of retail through artificial intelligence is under way. Successful retailers will be those who invest wisely in technology, while also reevaluating their operations and empowering their workforce. As retailers look to the future, these six key imperatives will help determine where and how to begin.
Jill Standish is a senior managing director and global head of Accenture’s Retail industry group.
