AI: Transforming retail from both sides of the till
AI is reshaping retail at an unprecedented scale, delivering benefits that span both consumer-facing experiences and back-end operations. From hyper-personalised marketing to intelligent supply chain optimisation, AI is transforming how retailers engage customers, manage resources, and drive growth.
Our research reveals that businesses leveraging AI are not only improving efficiency but also aligning profitability with sustainability goals. By tapping into real-time data analytics, retailers can streamline processes while minimising environmental impact.
Consumer-centric AI innovations
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Personalised product discovery: 61.5% of consumers consider tailored recommendations essential to their shopping experience.
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Frictionless in-store interactions: 65.7% of consumers want knowledgeable staff—AI-powered tools provide instant product insights.
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Sustainability-focused shopping: 70% of consumers appreciate carbon footprint data on product labels.
Operational efficiencies behind the scenes
AI isn't just revolutionising customer interactions—it’s also streamlining core retail operations. Key improvements include:
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Demand forecasting breakthroughs: AI-driven models help retailers predict demand fluctuations, reducing inventory waste by up to 20%.
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Dynamic pricing strategies: AI algorithms adjust prices in real-time, responding to market dynamics and driving sales uplift of 15%.
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Sustainable delivery solutions: AI-powered logistics tools cut transport emissions by 14% through optimised delivery routes.
Sustainability and profitability: A complementary relationship
Our research found that retailers who prioritise AI-driven sustainability initiatives achieved 92% profit growth over five years, while cutting carbon intensity by 24.6%. This demonstrates that environmental responsibility and profitability can coexist.
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Strategic priorities for maximising AI investment in retail
As AI adoption accelerates, retailers must act decisively to unlock its full potential. Our research identifies four key strategic priorities for businesses looking to harness AI’s transformative power. These priorities offer a practical roadmap for aligning AI with operational goals, sustainability targets, and customer engagement strategies.
AI is more than a technology—it’s a catalyst for operational reinvention. By focusing on digital infrastructure, workforce development, governance frameworks, and continuous improvement, retailers can future-proof their operations and drive long-term growth.
1️⃣ Establish a strong digital core
AI’s effectiveness depends on high-quality, structured data. A strong digital core ensures seamless integration of AI applications across business functions, delivering real-time insights that optimise everything from product recommendations to inventory management.
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73% of retailers highlight that data availability and quality issues are primary barriers to AI success.
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Unified data platforms improve customer targeting, streamline marketing, and reduce operational friction.
2️⃣ Reinvent talent and ways of working
AI-driven transformation requires a digitally literate workforce. However, 64% of retailers cite skills gaps as a significant challenge. Many lack specialised AI expertise, slowing down deployment and limiting impact.
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Targeted upskilling: Ensures teams can manage AI applications across marketing, logistics, and customer-facing functions.
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Cross-functional collaboration: Aligning data scientists, marketers, and analysts for holistic AI adoption.
3️⃣ Governance of change
With AI’s rapid adoption comes heightened scrutiny over data privacy, bias, and ethical use. Our research shows that 45.1% of consumers worry about how AI systems handle personal information.
4️⃣ Embed continuous improvement
AI innovation is dynamic—models must evolve alongside shifting consumer behaviours and technological advancements. Our research found that 58% of retailers are investing in model retraining to improve forecasting accuracy.
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About this report
About this report
This report, "Transformative AI: Maximising efficiency while minimising carbon", is a collaborative research project between Retail Economics and SymphonyAI, designed to uncover how AI is revolutionising retail operations while supporting sustainability goals.
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250+ senior retail executives:
Surveyed across the UK, US, France, Germany, and Canada, sharing their views on the opportunities and challenges of AI adoption.
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7,500+ consumers:
Providing insight into how AI influences their shopping decisions, expectations, and trust in AI-powered experiences.
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Audit of the top 200 global retailers:
An in-depth analysis tracking the relationship between AI adoption, carbon intensity, profitability, and customer engagement.
The research explores AI's transformative impact across the retail value chain—from personalised product discovery and predictive demand forecasting to supply chain optimisation and carbon tracking. It provides practical recommendations to help retail leaders:
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Identify key AI adoption priorities
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Overcome data, system, and talent-related barriers
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Drive profitability while advancing sustainability goals
📥 Download the report now to discover the AI strategies driving the next era of retail success.
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