Retailers Increasing AI Adoption Amidst Challenges in Data and Costs

What's Happening?

A recent report highlights that nearly half of retailers are regularly using artificial intelligence (AI) in their operations, with almost all planning to invest further in AI this year. The 2025 State of AI in Retail Report from Amperity surveyed 1,000 retail professionals, revealing that 45% of retailers use AI daily or several times a week. Despite this, only 11% plan to deploy AI tools at scale. The report identifies significant barriers to AI adoption, including data fragmentation, high costs, and limited technical expertise. More than half of the respondents reported fragmented customer data, while 46% cited the high costs of AI tools as a challenge. Additionally, only 21% of respondents expressed confidence in their ability to understand and act on customer data.

Why It's Important?

The increasing use of AI in retail is setting new standards for customer experience, particularly in supply chain, merchandising, and customer engagement. Retailers integrating AI into their core workflows are likely to gain a competitive edge in a dynamic market. However, the challenges of data fragmentation and high costs could hinder smaller retailers from fully leveraging AI's potential. The report suggests that overcoming these barriers is crucial for retailers to enhance customer loyalty and lifetime value. As AI becomes more integral to retail operations, businesses that can effectively manage and utilize customer data will likely see significant benefits in customer retention and operational efficiency.

What's Next?

Retailers are expected to continue investing in AI technologies, focusing on overcoming current barriers. This may involve investing in data management solutions and training staff to improve technical expertise. As AI tools become more affordable and accessible, more retailers may deploy them at scale, enhancing their ability to personalize customer experiences and streamline operations. The industry may also see increased collaboration between technology providers and retailers to address these challenges.