Generative artificial intelligence (genAI) is at the forefront of innovation in retail, as its ability to fabricate hyper-customised content is turning the tables in marketing and communication strategies, according to data and analytics company, GlobalData.
GlobalData’s latest Innovation Radar report, Cognitive revolution: genAI meets retail, explores how genAI is being deployed across the retail value chain, from inventory management and personalised marketing to customer experience and support.
'A Tailor-Made Experience'
Kiran Raj, practice head of disruptive tech at GlobalData, commented, "In a retail environment where the product-to-experience shift is increasingly significant, genAI can enable the creation of immersive, personalised experiences, integrating virtual and physical retail spaces in a manner that resonates with modern consumers’ expectations.
"Moreover, it is no longer about a one-size-fits-all engagement; rather, it is about a tailor-made experience catering to individual needs."
The use of GenAI can be used to transform retail operations, such as inventory planning, product recommendations, and customer service.
Applications based on the technology are used to create new product designs based on defined criteria and sentiment analysis to predict customer trends.
Saurabh Daga, associate project manager of disruptive tech at GlobalData, added, "By leveraging key data points from customers’ purchase history and preferences, genAI can facilitate building personalised shopping experiences and targeted marketing strategies. The technology can empower retailers to deliver superior service at reduced costs, leading to greater customer satisfaction."
Read More: 5 Ways Generative AI Could Transform The Retail Industry
Application Of GenAI
The technology is already being used by Carrefour and IKEA to streamline operations and augment customer support.
Elsewhere, e-commerce players like Amazon, Shopify, and Instacart are leveraging genAI to improve online shopping experiences and increase cart conversion rates.
Big technology firms, such as Google and Salesforce, are offering genAI solutions to help e-commerce players, as well as retailers, optimise their online customer engagement, GlobalData added.
Daga stated, "While there are inherent challenges in implementing genAI, particularly in consumer-facing sectors like retail, the potential for substantial progress is undeniable.
"Challenges such as content quality and privacy must be managed through strong governance. Small and medium retailers can benefit from strategic partnerships to overcome entry barriers required to build the supporting technology, infrastructure, and personnel for genAI implementation."
