The retail industry is poised for a major transformation with the integration of artificial intelligence (AI). Retail business leaders expect that in the next two years, AI will have its biggest impact on customer intelligence, inventory management, and chatbots for customer service. AI can provide support for retail operations, increasing profits and optimizing business processes. AI services in the retail sector are predicted to increase from $5 billion to above $31 billion by 2028. However, there are concerns about the impact of AI on jobs in the retail sector.
As the prevalence of AI in the retail industry has significantly increased over the past few years, more than a quarter of retail companies now use AI in different aspects, compared to only 4% in 2016. AI is disrupting the retail industry across the value chain and is emerging as a powerful tool for retail brands to gain a strategic advantage over their competitors. AI is creating better demand forecasting by mining insights from marketplace, consumer, and competitor data, making proactive changes to a company's marketing, merchandising, and business strategies. AI is also changing inventory management and personalization, as well as customer service through chatbots.