As they take stock after the year-end frenzy of shopping the holiday season always brings, retail CIOs attending the National Retail Federation’s annual show, NRF 2024, may be wondering how they can improve their IT systems’ performance over the next 12 months. If software vendors have their way, the answer is likely to involve more artificial intelligence.
Sales statistics
Two recent surveys concur that only a tiny minority of retailers have no plans to implement AI today. One, conducted by Salesforce, found fewer than 3% of commerce organizations have no AI plans, while 29% have already fully implemented it into their workflows. The other, by Nvidia, looked more specifically at generative AI, and found that 98% plan to invest in it.
Nvidia also found that among those already using AI, 69% believed it had contributed to an increase in their annual revenue. For some, the increases were dramatic — 15% of respondents reported more than 15%, and a further 28% reported increases between 5% and 15%.
That still leaves 26% of respondents willing to credit their revenue increase to AI use — even though it was less than 5% at a time when, according to the NRF, retail revenue across the US increased by an average of 3.7% year on year in the first 11 months of 2023, AI or no AI.
But 2023’s rate of consumer spending growth is not necessarily sustainable in 2024, the NRF’s chief economist warned, so retailers may need all the help they can get.
Beyond boosting revenue, respondents gave plenty of other reasons to adopt AI in retail, including creating operational efficiencies (53% of respondents), improving the consumer experience (42%), improving decision making (37%), or yielding more accurate demand forecasting (21%).
