AI in Retail: Smart Convenient Shopping Experience

Technology is changing our lives, now with Artificial Intelligence(AI) getting more and more popular, technology has jumped to another level. AI is disrupting every industry, leading to new business models. AI is stepping into almost every sector or industry and Retail is no exception. Let’s try to understand the applications of AI in Retail sector.

AI in Retail

AI in Retail

Uses of AI in Retail

Retail companies are now using AI to improve the shopping experience for customers. The raw data about customers, products, and items that the store has, AI can transform that raw data to more valuable information. Let’s go over the uses of Artificial Intelligence in Retail sector.

Better Customer Experience

AI can better understand the customers, depending on the customer’s previous purchase history, choice of products, etc. AI can personalize the customer’s experience. And when customers are better served then customers remain stuck to the brands or products. In the Retail business customer satisfaction is given the utmost priority and AI helps us achieve this better.

Lowe’s a hardware store in North Carolina is one of the home improvement retailers. It has created a bot and named it LoweBot to help customers navigate the store. The bot supports multiple languages. Not only that it also helps the store staff to manage the inventory.

Another example is the well-known beauty products brand Sephora, a french multinational retailer uses AI for a better customer experience. Just walk into the store and find the makeup shade that you like, and AI helps you with virtual makeup looks, you don’t have to put on makeup. AI scans your face and suggests the best possible makeup shade.

AI in the form of Virtual Assistant

AI is also being used in retail in the form of a Virtual Assistant. The most popular one’s are Amazon Alexa, Siri, and Google Assistant. Just on voice command, these assistants get activated and ready to serve the customer’s needs. These assistants help customers find products and place the orders.

Domino’s Pizza has been using a virtual assistant to take up an order.

Retail stores have been seeing an upward trend in the general adoption of voice command orders. Voice shopping is increasing day by day, as it’s faster, we speak fast than we type. Hence it’s predicted that adoption will continue to grow over time.

Inventory Management

AI is helping manage this tedious task. Inventory Management is no easy task for huge stores. AI helps retailers to know which products are needed and in what quantity.

As AI is capable of processing huge data, it can analyze and generate accurate reports, that help retailers to focus on sales, they get an insight into what’s more popular in their store, and what’s the customer’s favorite choice. And additionally, the products which aren’t generating sales can also be tracked and appropriate measures can be taken. Scenarios of unsold and out-of-stock can be reduced.

Store owners/retailers can effectively use AI to promote well-performing items or products. The popular clothing store H&M Group uses AI to analyze the store inventory.

Cashier Free Stores

Standing in long queues in retail stores is something that customers get fed up with. Waiting in long queues always frustrates customers. AI can help stores go cashier-free, which means no queues.

The best example is the Amazon Go store. So what it feels like to shop in Amazon Go store, well just walk in, grab the items you want, then walk out without having to checkout in the traditional way. There are around 25 Amazon Go stores in the US. The technology works very efficiently when you pick an item or put it back on the shelf. Finally, when you walk out of the store with products or items, Amazon will deduct money from your linked wallet.

Sam’s Club, a Walmart owned grocery store has an autonomous checkout system. Global supermarket chain Aldi recently opened its first cashier free store. Retailers have slowly started adopting cashier free stores to eliminate the long queues.

Theft and Suspicious Activity Detection

When we have the cashier free or autonomous or self-checkout stores there is also a possibility of theft. AI is designed to flag any suspicious activity depending on user behavior. Shoplifting has been a major concern for retail stores, despite security cameras, theft cases continue to rise.

Artificial Intelligence is using algorithms to determine the behavioral patterns of shoppers in a bid to reduce theft cases.

Vaak from Japan and London based Third Eye are start-ups developing AI for shoplifting prevention.

Sales Predictions and Dynamic Pricing

As AI holds a lot of data, it further analyzes it and makes future sales predictions. Machine learning algorithms are being used to analyze customer behavior such as, purchasing habits, and in which part of the week or month, or year customers purchase more and are more active. AI transforms this data into more valuable information which retailers can use effectively to increase their sales.

AI also helps Retailers stock the right products at the right time. This not only helps retailers increase sales but also allows them to reduce the wastage of products by not overstocking products that are unlikely to sell.

AI can help Retailers change prices for their products. With dynamic pricing, stores can get to know when a particular product gets more sales i.e in which price range, hence benefiting both the Retailers and customers. Retailers can present the best offers, promote products, etc.


No doubt AI has the potential to make the shopping experience better in the future. As more and more Retailers start adopting it, the whole shopping experience is going to change. Retailers are using AI to streamline operations, Inventory Management, improve the customer experience, and increase sales.

From virtual assistants and chatbots to data analysis and supply chain management, AI is being used in a variety of ways to make the retail industry more efficient and cost-effective. As AI technology continues to evolve, we can expect more changes in the Retail Industry.

You might also like - Future of AI in Automotive Industry

Leave a Comment