Artificial intelligence (AI) is playing an increasingly prominent role in many of the world’s biggest e-commerce platforms, but what can we expect from retail AI in 2019?

We hear from six experts in the field to find out what’s in store, and how it will shape our buying choices and decisions over the next 12 months.

The year of the smart store

“2019 will be the year of the smart store, as other retailers follow in the steps of Amazon to launch their own AI-powered smart stores. But retailers will only come out triumphant if they embrace the right technologies to continue to stay relevant in the face of reduced human interaction.

“If retailers are to allow for high-priced items such as mobile phones to be purchased via their smart stores, they will need to ensure they have the correct capabilities to automatically process and activate new contracts or insurance policies.”

Kevin Gillan, MD Europe at SquareTrade

Retail to embrace visual and voice

“As we look to 2019, a number of AI-powered innovations are likely to take flight across the retail sector in particular. One of the most prolific will be the use of AI to optimise product search, including camera-based search that uses neural networks to understand images without a search query.

“Consumers will have the opportunity to use their smartphones to snap an image of a product they like and be taken to a place where they can buy the product.

“Visual search is a big step toward ‘queryless’ search where search engines either pre-empt or interpret a consumer’s intent without the need for an explicit query. Visual search has the advantage of being able to search for items when we can’t think of the words to describe them.

“Similarly, the upcoming year will see significant improvements in the accuracy of AI-enabled voice search. As the algorithms fueling virtual assistants become increasingly sophisticated consumers will be able to ask questions like ‘should I_?’ or ‘_for me’ and receive personalised recommendations that draw off a wide range of contextualised preferences, previous product purchases, personality characteristics, and behaviors.

“Consumers will be able to overcome decision paralysis by turning to virtual assistants to guide them through difficult product choices.”

Scott Clarke, chief digital officer and global consulting leader for Retail, Consumer Goods, Travel and Hospitality at Cognizant

A new wave of retail AI capabilities

“The pace of innovation in retail shows no sign of slowing in 2019. The industry is seeing a new wave of core capabilities for retailers using AI.

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“One is availability-management. Retailers will continue to move away from the flawed process of only managing what’s in the store. Increasingly they will focus on what’s actually on the shelf, in the ‘eyeline’ of the consumer. This will not only go some way in eliminating out of stocks but will also give rise to information-powered shopping.

“Components of AI platforms being brought into the retail space, such as computer vision, are allowing retailers to see what is in the store and where the product came from.

“Image-recognition and machine-learning are now being combined with granular data that allows for product-level decision making at the micro level – something that past analytics tools could not provide.

“The core to seeing these new applications become reality is a real-time feed of what is currently on the shelf. We’re seeing that fixed-camera solutions are the lowest-cost way to collect real-time in-store data at scale. Pairing this with the rapidly expanding machine-learning capabilities that we are leveraging will enable unique insights into consumer shopping habits on a level we can’t even imagine.

Mark Cook, VP product, retail at Trax Retail

Automation in retail becomes mainstream

“Recent findings from Microsoft show that UK retailers are falling behind in integrating AI into their business. However, 2019 could be the year that automation in retail becomes increasingly mainstream.

“Ongoing closures on the high street, alongside profit warnings from online behemoths such as ASOS, have thrown the difficulties of the sector into sharp relief. Many brands – in a bid to remain competitive – have attempted to stand out by simply offering the lowest prices. However, this ruthless competitor undercutting is costing millions in lost margins. Indeed, our recent research found that 36% of UK retailers have jeopardised their margins in the past because of poor pricing decisions.

“Intelligent, AI-powered systems can combat this. Rather than simply matching the lowest market price, they take into account a huge range of factors such as individual commercial strategy, stock levels and price elasticity to determine the optimum amount for each product to maintain margins.

“Adopting this technology could therefore help struggling retailers to stay profitable as we move into 2019 and beyond.”

Sander Roose, CEO at Omnia Retail

2019: The year of influence

“The online sales process is already benefitting from automation aided by AI, but what we’ll see more of in 2019 is its use to help salespeople learn more about their customers and better meet their needs. But it won’t eliminate jobs like the cynics would have you believe.

“If anything, it can make great salespeople even more valuable to businesses. Salespeople aren’t selling widgets anymore, they’re selling services, and these kinds of deals don’t just end with a signature and a handshake.

“The salesperson of the future will have to build rich and meaningful relationships with their customers. Relationships that require nurturing, which can help build new relationships within their customers’ business, ensuring products are maintained and customers feel valued. “

Shane Finlay, chief value advisor at SAP

AI to help retail sustainability

“Sustainability is becoming an increasing concern: people are more worried about issues like cutting plastic waste than cutting costs, so we can expect businesses to take action in 2019. That can be easier said than done, however.

“Taking the retail industry as an example, many retailers still rely on outdated replenishment tactics that are based on historic sales data, inaccurate predictions and sentiment; this approach must change if retailers are to make a real impact on waste.

“Retailers must take a more innovative, data-driven approach to their replenishment if they are to optimise previously manual, error-prone processes and reduce the amount of stock that is wasted, and therefore the plastic packaging that is thrown away.

“While data is the door to a more sustainable world, AI holds the key. Retailers have enormous amounts of data, from past sales, customer footfall, public holidays and even changes in weather.

“Using Artificial Intelligence to optimise this data will empower retailers to reduce plastic waste by accurately predicting customer demand and automating replenishment decisions. Making the effort to take robust action on reducing plastic waste will not only provide brand differentiation, but also help save the planet.”

Uwe Weiss, CEO at Blue Yonder


Read more about AI in 2019 in the latest issue of Verdict AI, our quarterly magazine on artificial intelligence