McKinsey estimates the potential annual value of AI in the retail industry sits between £300 billion and £600 billion. It's clear the opportunity for companies is substantial.
But what exactly does the future of AI in retail look like?
We've assembled 8 interesting AI in retail use cases so you can see what’s possible and take inspiration for your own company.
1. Optimised operations
As you know, inefficient operations suck the life out of value chains and distance the customer from making a purchase.
Using machine learning to forecast demand and prevent stores from running out of stock will help manage inventory and keep things moving.
2. Improved decision making
Managing data at scale is a challenge for retail firms. It's not just ever-increasing volumes and velocity of data but, as they use more apps and do more in the cloud, there's a growing risk of data languishing in silos.
With machine learning and AI in retail, companies can integrate data better and find the insights needed to boost revenue and customer satisfaction. For example, we helped Morrisons unlock the value of their data.
3. Personalised experiences
‘Today's customers expect a personalised experience when they are shopping.’ - Erik Lindercrantz, Partner, McKinsey
Another opportunity to use AI is to give customers more personalised experiences, for example in ecommerce where data analysis can recommend relevant upsell products to increase sales.
4. Smarter store planning
A prominent US retailer used AI to cut the time needed to plan store space from six months to two weeks, according to Harvard Business Review.
By using machine learning and classification models, they also found patterns and insights that manual store planning missed.
5. Reduced equipment costs
Another way Retail AI solutions and machine learning can help is to improve how your business makes use of its equipment.
As an example of what's possible, a South African brewery used machine learning to gauge the performance of its coolers as they travelled between restaurants. This empowered them to better understand and manage downtime, and in turn, save money.
6. Enhanced customer communication
Did you know that nearly 40 percent of internet users prefer interacting with a chatbot rather than a live agent? AI is making them more responsive, and useful and improving the way they interact with users.
There are many clear benefits to using chatbots in your business. For example, they can run 24/7 and serve a global market.
7. Better C02 management
With many companies pledging to reduce carbon emissions, it's good to see that machine learning can help here too.
How? By optimising the routes taken by your logistics network and reducing transport miles for logistics or deliveries.
8. Seamless checkouts
Amazon Go is the best example of how to improve the online shopping experience in the retail sector because of its recent deployment of AI.
It’s a new kind of real-world store from Amazon that gets rid of checkouts to give customers a smoother experience. You simply walk into the store, pick out the food that you want, and then walk out. The Amazon Go app handles the rest.
Embrace the future with Mastek
The question is: could your retail company raise its game by using AI?
From providing personalised experiences to reducing equipment costs, we've covered some powerful ways to use AI in retail. However, it can be hard to know which is the best opportunity and what the next steps for your business might look like.
If you'd like to know more about the benefits of AI in retail connect with our expert team to explore what's possible, reach out today.