While the idea of artificial intelligence (AI) took the world by storm in 2024, the follow-through didn't quite land the way many anticipated. With so much still to learn about the technology, brands encountered real challenges executing its deployment, so it's no surprise the AI takeover hasn't quite materialized yet across retail.
But as the industry settles into 2025 with more realistic expectations for what AI can do, its power is still clear. Its ability to help brands personalize the in-store customer experience can transform a retailer's operations, especially where the right foundational technology is already in place.
Data, Data, Data
AI is only as useful as the information it receives. The more accurate the data fed into AI systems, the better its analytical capabilities perform. In today's retail environment, which relies on a range of technologies across the entire retail ecosystem, accurate data shouldn't be hard to come by.
From Radio Frequency Identification (RFID) measuring inventory levels in the supply chain, to Order Management Systems (OMS), Customer Relationship Management (CRM), and Point of Sale (POS) technologies tracking customer journeys, preferences, and transactions — many retailers already have these solutions deployed in their operation. With access to this data, an AI model can receive a significant amount of reliable information that retailers can turn into actionable outcomes and highly tailored experiences.
Creating a Personal Touch
Once the data challenge is solved, retailers can feed as much information as needed into an AI model that processes it and presents it back to associates in a digestible format.
The right model can create natural-language summaries covering a range of retail touchpoints, including current inventory levels, sales trends, and other important metrics — reports that can be shared with staff to keep them informed of evolving product trends and customer interests.
This gives shop floor staff the ability to handle any customer inquiry instantly. Better yet, AI that can learn from previous trends and accurately forecast future ones can make on-the-spot recommendations based on a customer's own preferences. Even on a first-time interaction on the shop floor, the technology can make customers feel like the retailer has known them for years — valued, with their shopping needs met. That significantly enhances sales opportunities and encourages customer retention.
AI Will Arrive
2024 showed that the world isn't quite ready for AI to transform retail as we know it. But it is ready to assist with small integrations that help retailers with daily tasks — managing inventory or personalizing in-store experiences.
As the industry learns more about the technology, these integrations will get bigger, faster, and more accurate. For now, AI is already bringing value to retailers as an add-on to existing technology stacks.