How AI Can Be Used in Successful Retail Strategies

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By Michael Needham, Chief Content Officer,

Artificial intelligence (AI) is revolutionizing the way business works, and it can be used in a variety of different retail applications, making life easier and retail strategies much more effective. In fact, 83% of companies state that adopting and utilizing AI is a top priority for their business strategies.

Primarily, retailers are adopting AI to generate customer insight, improve consumer experiences, and retain shoppers.

The use of AI in retail has become more frequent as it has become accessible, and this trend is likely to continue to grow.

Uses of Artificial Intelligence in Retail

Let’s dive into some of the uses of artificial intelligence in retail.

Customer Insights

AI can help retail spaces, both in person and online, create personalized experiences. For instance, when using an online retail app, AI learns from consumer purchasing preferences. As a result, advertisements are then tailored to your customers’ buying behaviors, increasing the likelihood they make a purchase based on product suggestions.

For instance, 80% of shoppers make more purchases from retailers that offer personalized product suggestions. However, tailored ads are not just a way to get people to spend more. It can improve the customer service experience, too. People would usually rather see ads and related products that they are interested and AI aids in creating relevant and tailored experiences.

Managing Stock and Inventory

AI can also be used to help businesses to increase productivity in a number of ways, including managing inventory and reducing unsold stock. In fact, inventory management is the third largest use case for AI. Aside from tracking the number of items in stock, intelligent AI in retail can also be used to forecast changes in demand seasonally or based on competition. Moreover, stock data can be utilized by AI to determine when to order seasonal items or offer discounts and sales.

Lastly, AI in inventory management helps locate items more quickly, reducing shipping time and improving the consumer experience. Unsurprisingly, 74% of businesses have experienced shipping delays. With the help of AI, these stalls can be mitigated.

Outreach and Engagement

Virtually every company must make some effort to reach out to customers and build and garner a relationship. In the world of retail, a lot of customers expect businesses to have repeated interactions with them, especially if the company seeks to establish brand loyalty.

Consumer behaviors and engagement can be measured through customer relationship management software (CRMs), which tracks conversions and customer buying trends. For instance, some customers might react well to personalized marketing content sent via email. AI systems may be able to measure this and provide better recommendations for customers, which may lead to more sales.

In-Person Stores Can Be Free of Cashiers

We are already seeing contactless and cashier-less retail chains. For instance, Amazon Go is a retail chain that is entirely cashier-less. Instead, shoppers’ Amazon accounts are automatically linked and charged based on the items they purchase in-store. This technology allows stores to streamline their operations and save money on staffing, but they can also make a more efficient shopping experience for the consumer. As of 2024, 10,000 retail stores are expected to transition to autonomous checkout technology.

Visual Search

AI in retail has become an incredible system for categorizing and sorting images and streamlining online search results.

It can also be a way to tag and connect products to show alternatives. For instance, AI has the capacity to learn. As such, it can adapt to offer accurate product suggestions as it acquires more consumer data and understands buying behaviors.

For instance, many online retailers feature a related search section. Using this data from customer searches combined with an AI analysis of what is in the images means that people can be matched with products they are more likely to buy and more likely to enjoy.


AI support such as chatbots can be a fantastic way to help customers without having to pay a fortune for employees to constantly be responsive to people with a problem. This is one of the biggest and best benefits of AI, and this means that the system can ‘learn’ from the issues.

AI chatbots can provide better responses than just a simple “knowledge base” or an FAQ section of a website. Instead, AI support is becoming more consistent and reliable, offering shoppers personalized answers to their individual inquiries.

While customers still value the option to speak to a human, they may value the speed and convenience of an AI chatbot, especially if it resolves their issues.


AI is a relatively new addition to the world of retail. Whether you are shopping in-person or online, AI technology is inevitably going to change the industry. If you work in the world of retail, it could be time to embrace AI to stay ahead of the curve and improve the experience of staff and customers alike.

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