PROMOTIONAL RESEARCH
From boosting supply chain efficiency to enhancing personalisation, OSF Digital’s Oana Dereli explores the competitive advantages of AI adoption
AI is already transforming retail, and the businesses embracing it will be the ones leading the industry forward.
In this article, we’ll explore three key ways AI is reshaping the industry: boosting supply chain efficiency, enhancing personalisation, and driving in-store innovation. While each brings unique benefits, they all point to the same conclusion: retailers that delay AI adoption risk falling behind.
Boosting supply chain efficiency
The supply chain is the foundation of retail, and AI is making it more flexible and efficient.
For example, AI-guided forklifts, showcased at recent retail expos, demonstrate how machine learning can dynamically route warehouse equipment to avoid bottlenecks and optimise workflows.
Another significant innovation is digital twins, virtual simulations of physical locations that enable retailers to test warehouse layouts and anticipate logistical challenges before applying costly improvements.
According to a LeanDNA survey, 37% of retail executives have already deployed digital twin and simulation technologies, highlighting the increasing reliance on AI to optimise operations.
Meanwhile, a Salesforce study revealed 81% of retail executives agreed that inefficient processes and outdated technology drain productivity. With AI, retailers can turn this challenge into an opportunity by forecasting demand, optimising inventory, and streamlining operations.
Personalisation: Building customer loyalty
Almost three-quarters (73%) of customers expect better personalisation as technology advances, says Salesforce.
By leveraging AI to analyse browsing history, purchase patterns and even time spent on specific product pages, retailers can offer highly relevant recommendations. This not only simplifies decision-making for customers but also drives higher conversion rates.
Search remains a top use case for AI, as understanding consumer intent is important for retailers.
Visualise a customer visiting a website for the second time; AI recognises the customer, detects their preferences and instantly suggests products they’re likely to buy. This frictionless shopping experience is increasingly expected by today’s consumers.
Voice-enabled AI is also reshaping customer service. Hours of waiting to fix a basic problem are a thing of the past. AI agents can quickly analyse customer queries, recognise patterns and provide instant solutions or connect them to a human agent.
In-store innovations
AI is also enhancing physical shopping experiences. Innovations such as intelligent product scanners and automated checkout systems are becoming commonplace in the UK. These systems allow customers to scan items as they shop; some even eliminate the need for scanning entirely by detecting products placed in their basket.
Retailers are also using AI to capture customer intent in new ways.
Imagine approaching a wine aisle and receiving a tailored message about complementary cheese bundles. Or picture a smart fridge door that opens as you approach it, understanding your intention to grab a certain product.
These experiences delight customers and streamline their journey, building loyalty and enhancing brand perception.
Lessons from ecommerce
Generative AI is reshaping ecommerce by enabling hyper-personalisation and dynamic pricing strategies.
In a 2024 survey, 30% of major online retailers in France reported using generative AI to create personalised content, while 56% of European ecommerce professionals highlighted AI’s potential in analysing customer data and behaviour.
However, the lesson is clear: those who delay AI adoption risk falling behind.
Why early adoption matters
Retailers who integrate AI into their strategies now will not only meet rising consumer expectations but also position themselves for long-term success. Whether improving operational efficiency, elevating customer interactions, or creating seamless in-store experiences, AI is the key to staying competitive.
The question is no longer if retailers should adopt AI but how quickly they can implement it to transform their operations. Early birds will be the ones defining the future of retail.
Curious to find out more?
As AI continues to redefine business operations, understanding its real-world applications is key. Explore real-world use cases, core capabilities, and competitive advantages of AI agents in OSF Digital’s latest white paper.
To see how OSF Digital helps businesses drive results through digital transformation, explore these case studies:
- See how Marks & Spencer expanded its loyalty program globally with an omnichannel approach, driving engagement across multiple touchpoints.
- Discover how Harvey Nichols enhanced its high-end loyalty strategy, delivering personalized experiences and boosting customer lifetime value.
For a glimpse into the future of AI-powered productivity, explore AllAi – a platform designed to unlock new levels of efficiency and innovation.
Oana Dereli is AVP of retail, UKI at OSF Digital
With a robust foundation in both technical and marketing disciplines, Oana has spent nearly two decades advising companies on their digital transformation strategies. Her deep expertise in retail has led her to specialise in integrating loyalty into connected commerce, helping businesses realise the full potential of their technology investments and deliver exceptional customer experiences. As AVP of Retail for UKI, she spearheads new business initiatives, empowering retailers to thrive. Oana also demonstrates her leadership by co-chairing the OSF Women’s Network, championing the advancement of women within the organisation.
