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At a session at the NRF 2024: Retail’s Big Show, Amy Eschliman, managing director of retail at Google Cloud, predicted that generative AI (GenAI) could be as disruptive as the arrival of the internet or mobile phones.
“These massive transformations are nothing new to retail — the internet is a great example, it changed the way we shop; mobile phones, same thing,” she said. “Now it’s generative AI, which has the capability of transforming everything from the customer experience to the associate experience. It’s got tremendous potential, and it’s a really exciting time for retail because of this technology. It’s about the ability to synthesize and analyze information that we did not have before. The possibilities are really endless.”
AI and GenAI were either the primary topics or at least touched on across all panels at the NRF show, while AI-baked innovations were widely on display on the show floor.
Sucharita Kodali, VP and principal analyst at Forrester, said that "a lot of what is most powerful about AI already exists" in retail, citing recommendation engines, payment fraud protection, store labor optimization, and fulfillment analytics as examples. She said, "These are the tried and true tools that are built on machine learning and, in some cases, deep learning, that have been established and valued over time."
However, she also said that outside some generated text and chatbots, the most promising benefit of GenAI, citing marketing content, “is one of the less common use cases of AI at retail right now.”
GenAI applications for marketing applications include writing ad headlines, email subject lines, and product descriptions; summarizing customer reviews; and creating images.
Many panelists remained optimistic that AI will tackle repetitive tasks to free up staff to tackle more creative endeavors, including enabling associates to interact more with customers, rather than replace jobs.
FedEx CEO and President Raj Subramaniam said, “I fundamentally believe that this is a pivotal time for e-commerce as we combine the power of AI and machine learning with the capabilities of our physical network to create end-to-end digital solutions and an unparalleled experience for you and your customers.”
Macy’s CFO and COO Adrian Mitchell said the retailer has made a “lot of progress” applying AI to pricing science, continues to experiment with AI-powered personalization and inventory allocation, and is exploring a wide range of “simply automation.”
“What we've learned is two things,” said Mitchell of Macy’s AI approach. “Number one, it can definitely make your business simpler. It can help you execute better and help you make better decisions. What we’ve also learned is you have to lean in because retail is a disruptive space. If you stand still, you're falling behind with their customers, you're falling behind the competition.”