Updated January 18th, 2024 at 13:45 IST
Over 70% retailers to rely more on Gen AI by 2024 end: Survey
Gen AI aims to revolutionise retail experience by tapping vast repositories of unstructured data.
- 3 min read
New-age tech for retail: Known for its adaptability, the country's retail sector is at crossroads of a transitory phase driven by Generation AI (Gen AI), reveals a recent survey conducted by EY. As per the survey, retail industry has relied on data to predict consumer behaviour and handle inventories. “ ”The retail retail players are ready to use Gen AI to gain new insights and enhance efficiency throughout the entire retail value chain. 6 per cent of surveyed audience have already implemented Gen AI, a staggering 71 per cent in the retail sector plan to adopt it within the next 12 months, underscoring its perceived value," the EY survey has stated.
Gen AI's retail boost
Touted as the “next frontier in artificial intelligence”, Gen AI aims to revolutionise the retail experience by tapping into vast repositories of unstructured data. Current retail investments in AI, pegged at US$5 billion, are expected to soar to US$31 billion by 2028. 88 per cent of respondents in the retail sector believe Gen AI will have medium to high impact on their retail business, the survey has revealed.
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"As one could anticipate, 76 per cent foresee customer experience to have the highest impact, but it is noteworthy that the industry is exploring its impact on product innovation (65 per cent), cost reduction (54 per cent), and the entire value chain (50 per cent)," the survey added.
Two-fold retail growth by 2025
As per the EY report, Gen AI is projected to increase the retail sector’s profitability by 20 per cent at the end of 2025. The technology does not just reduce overheads but can significantly increase sales through tailored consumer experiences, it says. "Even local retailers can provide ‘hyper-local’ personalised shopping experiences by integrating Gen AI tools.
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This along with its IT prowess, India could emerge as a global nucleus for Gen AI retail solutions," the report has added. Angshuman Bhattacharya, National Leader, Consumer Product and Retail Sector, EY India said Gen AI is not just a technological leap. but a seismic shift in how retailers adapt, innovate, and enhance customer experiences. "With 71 per cent gearing up for adoption, it's clear that the retail landscape is on the brink of a transformative era. But as we ride this wave, privacy, ethics, and readiness take center stage," he said.
"The board, CEO and CIO leadership must navigate this AI revolution, balancing innovation with responsibility to craft a future where technology not only drives profits but also enriches our shopping experiences with integrity and transparency," the EY report said while quoting Bhattacharya.
Privacy and ethics
As Gen AI promises valuable insights for retailers, the industry faces ethical considerations and challenges, says the report. Privacy concerns arise with location tracking for real-time promotions, necessitating transparency in data usage. The survey indicates that 80 per cent of organisations express low-to-moderate readiness, citing unclear use cases and a skills gap. Currently, 82 per cent prefer partnerships with external tech providers for Gen AI implementation.
Published January 18th, 2024 at 13:45 IST