July 2, 2024
Seizing the AI opportunity in retail
“Cool.”
My 13-year old son rarely comments on my work but the news that I was speaking at an event about AI prompted a response that I will clutch as a parental win until my dying days.
But more seriously, his endorsement shows the pervasiveness that AI now enjoys. While it has infiltrated every conversation we have with executives and board members, such discussions are now no longer reserved for the boardroom. The advent of ChatGPT and GenAI has now made it relatable and tangible for us as consumers, parents and humans.
Today, these technologies are provoking a mix of excitement, awe and, unsurprisingly, anxiety about what lies ahead. And retailers are no exception.
Of course, there are many ways that retailers are already using these technologies. From forecasting demand to cashierless checkouts, inventory management to personalised customer recommendations, there is no shortage of options to consider.
But that in itself is a challenge.
Which direction should they take? How can AI have the optimum impact? What is the right decision for their culture, customers and growth ambitions? Answers will vary from retailer to retailer.
However, one area which brooks little disagreement is the importance of prioritising transparency and responsibility.
Leaders are often worried about taking too long to make decisions and being left behind by their competitors, but it’s important they balance speedy deployments with taking informed decisions and emphasising human-centricity.
Those retailers who adopt this blended approach are best placed to protect their customers and workforce, while also achieving optimum value from their investments. In other words, they need to:
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Test at pace
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Understand what works
- Ruthlessly kick out things that are not working
- Deploy thoughtfully and with the long-term in mind
Ensuring that safeguards are deployed around their customers’ personal data, and designing processes that combine algorithms and humans, will result in the enhanced customer experience which any retailer is striving for.
Achieving this ambition will require the right blend of interdisciplinary talent. Alongside engineers and technologists, retailers also need to attract specialists in areas such as data privacy and intellectual property — it really does take a village.
Much hinges on retail leaders being flexible enough to adapt to this fast-changing environment. It’s also important to recognise that failures can and will happen. Such incidents must be viewed as an opportunity to learn and do things better.
The good news is that much of this is already happening. And as the GenAI revolution continues to proliferate in every direction, retailers will have an abundance of fresh opportunities to pursue.
Doing so requires patience, responsibility and horizon scanning around the systemic solutions that AI can help deliver. Don’t think of GenAI as an overnight fix — far better to view it as a way to transform operations over the long-term.
So yes, retailers should take care in this new world but they should be excited, too. An as yet untapped blend of enhancing, transformational benefits for both themselves and their customers await.
This article first appeared in Retail Week.