In the dynamic and tech-savvy world of retail, there’s an unquenchable thirst for innovation. Between Big Data, IoT, Web3, NFTs, AR, VR, Metaverse, Cloud, and AI, there’s no shortage of exciting new technologies that promise to revolutionize retail.
Advances in Generative AI have driven massive interest in AI technology across all sectors. According to PwC, the potential contribution from AI to the global economy could be upwards of $15.7 Trillion by 2030. Within the apparel industry alone, McKinsey estimates that generative AI could add up to $275 billion to the apparel, fashion, and luxury sectors’ operating profits in the next three to five years.
AI in Retail Today
While AI isn’t a new technology, the accelerating pace at which advancements are being made and the speed of retail industry adoption certainly make it feel fresh and exciting.
Today’s retail early adopters are leaning into AI because of the significant scope of impact and immediacy that AI delivers across their business. From digital transformation and marketing to supply chain, product development, and merchandising, AI fundamentally provides new insights and boosts productivity. This, in turn, lays the groundwork for innovative growth strategies that benefit both consumers and retailers.
Yet, unlocking these benefits will still require the right mix of AI technologies. Learn more about how to successfully navigate the new AI landscape in retail and how to make smart investments today that will drive near-term and long-term growth.
The Power of Vertical AI Purpose-Built For Retail
It would be nearly impossible not to have heard about Open AI’s ChatGPT, the impressive generative Large Language Model (LLM) AI technology built for broad use and applicability. ChatGPT is an applied horizontal AI meant to handle a wide range of general tasks across different industries, drawing inspiration from the human brain’s problem-solving abilities to build versatile algorithms.
The next wave of retail innovation won’t come from horizontal AI but vertical AI. Unlike horizontal AI, vertical AI is built for the express purpose of addressing specific needs within a particular industry. A vertical AI is exclusively trained on industry-specific data, trained by industry domain experts, and trained for a specific industry purpose. This specialization makes a vertical AI, like retail AI leader Lily AI, highly adept at offering tailored solutions to meet the unique needs of the retail sector.
Getting Started: Strategize, Integrate, Test, Repeat
As AI continues to become more ubiquitous in every facet of business, its role in the retail industry is becoming increasingly significant. From enhancing customer experiences to optimizing channels and operations, AI is transforming the way retailers do business.
To continue to make the right AI technology investments today, retailers should stay focused on delivering amazing experiences and value for their customers. This includes making innovation a priority and allocating time and budget for integrating and testing new technologies that can deliver near-term wins as well as future growth potential.
As the increasing pace of technology continues to present new opportunities for retailers, it also presents new opportunity costs. In today’s fiercely competitive retail environment, waiting on the sidelines carries the risk of falling irrevocably behind. It’s best to jump in now and strategize, integrate, and test.
After all, yesterday’s innovation is today’s best practice and tomorrow’s table stakes.