A new report released by international law firm, CMS, “Disruption 2.0 – here we go again” (available here) uses extensive customer research and organisational surveys to consider the key themes and challenges for retailers in respect of the adoption, and ongoing use, of Artificial Intelligence (AI).
CMS and Retail Economics collaborated on the report, finding that close to 85% of companies surveyed thought AI-powered data analytics would provide for more sophisticated targeting of customers, and over 50% believing their organisations will invest in AI for warehouse and distribution support. AI could help high street retailers to fight increased competition from online retailers, and support a more seamless approach between a retailer’s physical stores and online presence. The report explores the effect of AI on the retailer’s relationship with the customer, with brands competing to make their offerings the most innovative and convenient for their consumer base.
However, the report advises organisations to be mindful of the regulatory and legal risks of implementing AI. From balancing dynamic pricing and competition issues, to the complex world of GDPR, the report suggests conducting appropriate due diligence prior to committing to an automated solution. Given the increased use of data (including sensitive data) in AI, retailers may wish to consider setting up an ethics board, and either upskilling existing staff or hiring new resources to manage AI.
The report also suggests that the impact of AI on a retailer’s wider consumer base, and ‘consumer readiness’ should be considered. In particular, older generations tend to be slower adopters of new technology, so overuse of AI could ‘turn off’ this demographic.
In summary, the report provides a useful guide for retailers looking to explore, and better understand, the applications and implications of AI in a consumer context, the challenges of implementing and using AI, and the consumer attitudes that will ultimately shape its future.