AI in Retail: What’s Driving the Next Wave of In-Store and eCommerce Innovation

AI is rapidly reshaping the retail landscape. What once felt experimental is now mainstream, with retailers applying AI to everything from demand forecasting and customer service to in-store automation and shelf monitoring. According to NVIDIA’s State of AI in Retail & CPG 2025, 89% of retailers are now using or evaluating AI in their operations, and 87% say it has already had a positive impact on revenue. Nearly 94% say AI has helped reduce operational costs — with more than one-quarter reporting savings of 20% or more.

At the same time, The State of In-Store Retailing 2025, from Coresight and Simbe Robotics, estimates that physical retail stores are losing 5.5% of gross sales, or $162.7 billion annually, due to inefficiencies such as stockouts, mispricing, and poor promotion execution. With these pressures mounting, AI adoption is accelerating across both store operations and digital commerce.

Here are the top AI trends shaping retail right now — and where brick-and-mortar and eCommerce teams should focus their attention.

Hyper-personalization becomes the new baseline

AI-driven personalization has evolved far beyond simple segmentation. Today’s models can tailor search results, promotions, and product recommendations based on real-time behavior and intent.

Surveys show 77% of shoppers prefer brands that personalize their experience, and nearly 90% of retailers using personalization say it boosts ROI. NVIDIA’s research reinforces this momentum: More than 60% of retailers using generative AI (genAI) apply it to personalized marketing and advertising, and 93% plan to increase their genAI investments next year.

Practical applications include:

• Dynamic homepages and category pages
• Channel-specific offers
• Personalized in-store experiences driven by loyalty and POS data

Generative AI transforms content, customer service, and discovery

GenAI has become one of the fastest-adopted tools in retail. Retailers are using it to accelerate content creation, automate customer service responses, generate marketing assets, and enhance product discovery through conversational search.

According to NVIDIA, over 85% of organizations use genAI in customer service and marketing, and 37% use it in search and discovery.

And consumers are already responding: AI-assisted shopping is experiencing a surge, with more shoppers utilizing conversational tools to compare products, plan purchases, and receive styling or compatibility advice.

Computer vision gives stores real-time awareness

Brick-and-mortar stores are entering a new era of “store intelligence” powered by AI, computer vision, and robotics.

The Coresight/Simbe report shows:

• 66% of retailers are implementing store-intelligence technologies
• But only 20% have scaled them chain-wide
• Shelf digitization technology adoption grew 16 percentage points year-over-year
• Poor visibility remains a significant issue:
  • Only 45% have visibility into out-of-stocks
  • Only 40% have visibility into promotion execution
  • Only 43% have visibility into planogram compliance to ensure optimized item placement and adherence to vendor agreements

Store-level errors add up quickly: Promotion execution problems affect over 53% of retailers, and pricing errors remain a costly gap. These issues directly contribute to the reported 5.5% loss in gross sales.

AI-enabled computer vision helps by detecting:

• Out-of-stocks and misplaced items
• Price label inaccuracies
• Planogram non-compliance
• Shelf gaps and empty facings
• Foot traffic and dwell-time patterns

With retailers planning a 151% year-over-year increase in spending on store intelligence, the race toward real-time store visibility is heating up.

Dynamic pricing and intelligent inventory optimization

Volatile demand, inflation, supply chain delays, and omnichannel fulfillment pressures make manual inventory planning nearly impossible.

AI changes that.

From NVIDIA:

• 82% of supply chain leaders will increase AI investment next year
• 58% say AI has already improved inventory and supply chain optimization
• 55% say AI enhances decision-making quality

Dynamic pricing powered by real-time inventory, demand signals, competitor data, and local conditions is also gaining traction. Retailers can optimize margins without relying on blanket discounts.

AI assistants empower store associates and back-office teams

AI isn’t just customer-facing. Many of the fastest wins come from empowering employees with superpowers through AI assistants and expert lookup tools.

Retailers are using AI assistants for:

• Guided selling and product expertise
• Store task lists and planogram support
• Vendor communication and invoice matching
• Auto-generated reports and store summaries

NVIDIA reports a significant increase in the perceived impact of AI on workforce efficiency: 42% of retailers cite “enhanced employee productivity” in 2024, up from 14% in 2023.

Blending digital convenience with in-store experience

AI is becoming the connective tissue linking eCommerce and brick-and-mortar stores.

Shoppers want seamless transitions between researching online, trying or picking up products in-store, getting personalized recommendations across channels, tracking inventory availability, and receiving consistent pricing and promotions.

Retailers are responding by utilizing AI to synchronize wishlists, loyalty data, browsing history, and cart activity across web and in-store environments. Meanwhile, computer vision and intelligent shelving bring digital precision to physical stores.

Consumers are ready for AI-native shopping. Surveys show over half would accept product recommendations from an AI assistant, and nearly one-third would let AI automatically reorder products once it learns their preferences.

How retailers can move forward without being overwhelmed

With numerous opportunities, the most challenging part can be deciding where to begin. A practical approach:

• Fix your data foundation. Poor visibility is costing retailers billions. Start with unified product, inventory, and customer data.
• Choose two high-impact use cases. Personalization, forecasting, and store intelligence pilots yield a fast ROI.
• Establish AI governance early. More than half of retailers consider AI governance to be “very important” to their companies, yet fewer than half have established formal governance policies. Risk increases as adoption scales.
• Start small. Apply AI forecasting to one product category with chronic volatility, then add more as you become more familiar with the tools.
• Scale slowly and measure consistently. Track sales lift, labor savings, reduced stockouts, and conversion improvements.
• Use AI as a tool. Always keep human review in the process for sensitive interactions.
• Build a unified customer profile. Personalization is only as strong as your data foundation.

Retailers who embrace AI now — especially in-store, where inefficiencies are most costly — will set the competitive pace for the next decade. The tools are ready, the technology is proven, and the data shows that the retailers who move early are already pulling ahead.

Contact ArcherPoint by Cherry Bekaert to learn how you can incorporate AI more effectively into your retail operations. Whether you have a physical storefront, an eCommerce presence, or both, ArcherPoint can help you unify your sales channels for more efficient operations and an improved customer experience.

Trending Posts