In today’s fiercely competitive retail landscape, leveraging the power of AI and automation has become essential for growth and innovation. With challenges ranging from inventory management to shifting consumer preferences, retailers are increasingly turning to AI and automation technology to stay ahead. Forrester has released our review of more than a dozen of those solutions and mapped them according to maturity and utility in our Tech Tide™ framework.
Our research indicates that all retailers should keep in mind the following:
- Many of the best AI use cases in retail are tried, true, and established. Retailers are tapping a range of AI and automation solutions to optimize operations and enhance customer experiences. For example, machine learning algorithms have been used for decades to improve inventory allocation, pricing, store labor optimization, and marketing promotions. These solutions are all built on established AI capabilities that for years have enabled retailers to streamline processes and adapt to evolving market demands.
- Emerging tools hold promise — do your due diligence to see about budget and strategy fit. Anomaly detection tools, akin to real-time MRIs for retailers, offer valuable insights into potential issues and allow for swift resolution and improved customer experiences. Yet retailers continue to underfund these tools. Autonomous stores, exemplified by Amazon’s Just Walk Out solution, promise frictionless shopping experiences that reshape the retail landscape. But the perception is that it is still too expensive for large-format stores.
- GenAI has some easy wins, but don’t expect radical transformation. While newer technologies such as generative AI hold promise, retailers must navigate complexities to maximize their impact. Better chatbots can indeed lower the cost of servicing shoppers — but first, they require rich content and data. Marketing has the potential to be truly personalized with generative AI, but retailers have not seen massive wins from that yet. Tried and true segmentation may be good enough for now until generative AI investments have more proof points.
The Forrester Tech Tide™: Retail AI And Automation, Q1 2024
We encourage you to read this study and explore more of Forrester’s extensive AI research. The retail industry continues to be dazzled by cutting-edge developments such as in-store drones and autonomous vehicles. In fact, appropriate AI solutions for any brand are a combination of what the brand is trying to achieve and what it has the budget and skill set to do. Reach out to us to schedule a guidance session or inquiry about any of these points or for guidance in your artificial intelligence and automation journey.
