With the rapid development of digitisation, the significance of artificial intelligence (AI) in industry and commerce is constantly increasing. Retail is not only one of the sectors most strongly influenced by AI. According to estimates by McKinsey, it also has one of the greatest growth potentials through the use of this technology. Our ongoing GDI survey on the topic of artificial intelligence in retail is providing the first interesting insight into the status quo as well as the challenges that companies are facing in this area.
The managers' perspective
Managers from industry and retail are painting an ambivalent picture of the use of AI. On the one hand, they describe the use of AI in companies as experimental (49% of respondents), motivated (41%) and data-driven (40%). As a result, many companies are showing a remarkable openness about and curiosity towards this new technology. They are investing in innovative projects, collecting and analysing data, and attempting to integrate AI solutions into their business processes in order to gain competitive advantages and work more efficiently.
At the same time, criticism is also being voiced. A third of the surveyed managers (30%) speak of disorganised approaches. Nineteen percent describe the handling of the topic of AI in their companies as half-hearted, and 17% even as disorientated. This in turn indicates that many companies are still in the early stages of AI implementation and mostly proceeding without a clear strategy. There is currently a lack of orientation, structure and a systematic approach in retail.
How companies describe their current approach to AI
Question: "Which of the following adjectives best describe how artificial intelligence is being handled at your company? Please select all the adjectives that apply in your opinion."; n = 225, multiple answers possible.
The use of AI in retail is therefore a double-edged sword. On the one hand, the technology offers immense opportunities to increase efficiency, better understand customer needs and develop innovative business models. On the other hand, the lack of clear strategies and structures can lead to companies failing to capitalise on the full potential of AI and falling short of their expectations.
Strategic issues, organisational challenges and the human element
Our survey shows that it is crucial for companies to not only focus on the technical aspects of AI, but also clarify organisational and strategic issues. For example, we are addressing the following questions: how should AI expertise be built up within companies? Should purchasing be handled by external service providers or should companies invest in training its own employees? What is the optimal distribution of AI skills within an organisation? Should a central AI department be set up and project-specific teams formed, or should responsibilities be distributed across different departments? How do you get started with AI? Is it advisable to gather initial experience with small pilot projects, or is it better to wait until successful use cases have been established in retail?
In order to obtain a more complete picture and compare the perspectives of companies with the expectations of consumers, we will now expand our AI study to include a consumer survey. This consumer survey will help us to better understand the expectations and requirements of customers and ensure that the AI technologies used in retail actually offer added value for customers and are widely accepted.
Exclusive pre-publication at the GDI retail summit
We will continue to analyse the results of our GDI surveys and provide valuable insight and recommendations for action to companies that are on the road to a digital transformation. Stay tuned for further developments and insight from our study, which will be presented exclusively by Dr Johannes Bauer, an author and the head of the GDI think tank, at the 74th International Retail Summit on 12 September 2024, ahead of its publication in late 2024.