Market Overview
The artificial intelligence in retail market will touch USD 34.52 billion at a 26.30% CAGR in the forecast period 2022- 2030, as per the new Market Research Future (MRFR) analysis. Artificial intelligence in retail includes the use of data, automation, and technologies like ML algorithms to offer consumers with a highly personalized shopping experience. AI can be applied to consumer experiences both in digital and physical stores.
Various factors are fuelling the global artificial intelligence in retail market share. As per the recent MRFR market estimates, such factors include the growing need for monitoring and surveillance at brick and mortar stores, increasing responsiveness and application of AI in the retail sector for effective logistics and product delivery, enhanced user-experience, higher ROI, amended productivity, increasing use during the COVID-19 pandemic, and the emergence of natural language processing (NLP) technology, deep learning, and machine learning.
On the contrary, privacy issues related to the use of artificial intelligence growth potential analysis and limited private-public partnership to directly address social implications may impede the artificial intelligence in retail market size over the forecast period.
Regional Analysis
By region, the global artificial intelligence (AI) in retail market covers the recent trends and growth opportunity across Europe, the Asia Pacific (APAC), North America and the Rest of the World (RoW). Of these, North America will steer the market over the forecast period. Higher demand to integrate AI in Canada and the US, early adoption of the technology, presence of top industry players, increasing investments in artificial intelligence in retail technology through funding to startups and strategic alliances, change in consumer preference in the retail sector, and improved ROI are adding to the artificial intelligence in retail market growth in the region.
The artificial intelligence in retail market in Europe is predicted to have the second-largest share over the forecast period. The presence of technologically mature countries like Italy, the Netherlands, France, Germany, and the UK, major developments in the retail industry especially in organized retail, and companies such as Tesco leading the forefront of retail are adding to the global artificial intelligence in retail market growth in the region.
In the APAC region, the artificial intelligence in retail market is predicted to grow at a fast pace over the forecast period. Several investors investing in trending and newer technologies, increasing adoption of AI technology in retail sector in India, Japan, and China, huge shift in India to organized retail from traditional retail that insist companies to adopt newer technologies for better customer analytics, advertising, and marketing by analyzing customer’s experience and behavior, notable growth across demand for consumer products, spending capabilities, economic growth, and internet infrastructure, favorable government initiatives, the growth of e-commerce in India and China, increasing investments in AI for real-time inventory and improved productivity, increasing digitalization, growing adoption of artificial intelligence-based solutions and services among retailers, and developing connectivity infrastructure and internet are adding to the global artificial intelligence in retail market growth in the region. The artificial intelligence in retail market in RoW is predicted to have sound growth over the forecast period.
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Key Players
The notable players profiled in the artificial intelligence in retail market report include SAP SE (Germany), Oracle Corporation (U.S.), Amazon Web Services (U.S.), IBM Corporation (U.S.), Google Inc (U.S.), Microsoft Corporation (U.S.), Sentient Technologies (U.S.), Salesforce (U.S.), Intel Corporation (U.S.), and NVIDIA Corporation (U.S.), among others.
Introduction:
In recent years, the retail industry has witnessed a significant transformation driven by technological advancements. Among these advancements, Artificial Intelligence (AI) has emerged as a game-changer, revolutionizing the way retailers operate and engage with customers. AI-powered solutions have paved the way for enhanced personalization, improved inventory management, and seamless customer experiences. In this article, we will explore the various applications of AI in retail and the benefits it brings to both retailers and consumers.
- Enhancing Customer Experience through Personalization
AI algorithms have empowered retailers to gain a deeper understanding of their customers and tailor their offerings accordingly. Through data analysis and machine learning, AI can analyze vast amounts of customer information, including purchase history, browsing behavior, and social media activity. This enables retailers to create highly personalized recommendations and targeted marketing campaigns. By providing customers with relevant and tailored experiences, retailers can significantly increase customer satisfaction and drive repeat business.
- Intelligent Inventory Management
Accurate inventory management is crucial for retailers to ensure they meet customer demands while minimizing costs. AI-driven solutions have proven instrumental in optimizing inventory levels and streamlining supply chain operations. By analyzing historical sales data, current trends, and external factors like weather and social media sentiment, AI algorithms can forecast demand with remarkable accuracy. Retailers can make informed decisions regarding stock replenishment, reducing the risk of overstocking or out-of-stock situations. This ultimately leads to improved customer satisfaction and increased profitability.
- Smarter Chatbots and Virtual Assistants
AI-powered chatbots and virtual assistants have become invaluable assets for retailers in handling customer queries and providing real-time support. These intelligent bots can answer frequently asked questions, assist with product recommendations, and even process orders. Natural Language Processing (NLP) algorithms enable chatbots to understand and respond to customer inquiries accurately. By automating customer service processes, retailers can enhance efficiency, reduce costs, and provide round-the-clock support, resulting in enhanced customer satisfaction.
- Streamlining the Checkout Experience
Long checkout queues have been a common pain point for both customers and retailers. AI has addressed this issue by enabling cashier-less checkout solutions. Retailers are now leveraging computer vision and sensor technology to create cashier-less stores. AI algorithms recognize products and track customer movements, allowing for seamless, contactless transactions. This not only reduces waiting times but also enhances the overall shopping experience.
- Predictive Analytics for Pricing and Demand Forecasting
Pricing and demand forecasting are critical components of retail success. AI-based predictive analytics models analyze a range of factors, including historical sales data, market trends, competitor pricing, and even customer behavior, to provide accurate pricing recommendations. By understanding demand patterns, retailers can optimize prices to maximize revenue and remain competitive in the market.
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Conclusion:
Artificial Intelligence has emerged as a transformative force in the retail industry, empowering retailers to deliver personalized experiences, streamline operations, and improve profitability. By leveraging AI-powered solutions, retailers can gain valuable insights into customer behavior, optimize inventory management, automate customer support, and enhance the overall shopping experience. The implementation of AI in retail has the potential to reshape the industry and foster a customer-centric approach.
