AI in Retail Status
AI is increasingly deployed in the retail industry in 8 main areas, namely:
- Personalized marketing
- Customer service
- Inventory management
- Dynamic pricing or price optimization
- Loss prevention
- Fraud detection
- Computer vision assisted visual merchandising
- Supply chain optimization.
Some areas are more successful than others. AI assisted chatbots, for example, are not widely valued by consumers and often give frustrating responses. Conversely, machine learning, a branch of AI, gives much better results in areas like demand forecasting. AI models allow more variables to be included in them improving the quality of the results achieved.
But retailers should be aware that many software vendors overhype their use of AI and the success it can achieve. The number of retailers implementing AI based solutions is far lower than the media channels would have you believe. That's not to say ignore it, but it will take a good number of years yet before it becomes mainstream for most retailers. Today, it's mostly a tool for the very large retailers who can invest the big bucks.
If you would like a more detailed review of the components of AI and more details on where retailers are starting to use them, and you have access to the retail and consumer goods industry WIKI and EPSS, click here.
If you don’t have access, you can download a free one week trial here.
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Posted by Brian Hume
13th May 2024
