It is no secret that the UK retail industry has been struggling in recent years. A report by PwC has found that every day, 14 high street stores are forced to close down. Even the big name brands are not safe from this worrying trend. In order to stay afloat, it seems clear that companies need to embrace new technology.
In a WBR Insights report, 200 senior retail leaders were asked about their concerns in regard to the future of the industry. More than a quarter stated that one major issue was finding staff with the expertise to use cutting edge technology. Senior management is aware that the future will involve ever-evolving tech, so the employees of tomorrow need to be able to utilise it effectively.
Artificial intelligence has a range of practical applications to help stores thrive. Research by Microsoft has found that 54% of retail leaders predict that implementation of AI will be a key skill for staff within the next five years. This is due to the fact that numerous companies have recognised the many benefits that AI will provide. These applications are likely to further increase as the technology evolves in the years to come.
There is already a host of AI programmes that are specifically designed for retail. Japan’s SoftBank has partnered with the French manufacturer Aldebaran to create Pepper, a robot which can interact directly with customers and perform sales. Use of this robot in one store increased foot traffic by 70%, proving that this tech is more than just a novelty for customers.
Customer recommendation software is another highly useful aspect of AI. Cognitive computer programmes can create product recommendations based on a customer’s past purchases. The industry has already seen a trend in targeted advertisement and sophisticated customer profiles and AI will be the driving force for this in the near future.
There are four concepts behind modern AI in retail. These are communication, optimisation of pricing, rationalisation of inventory and experiential retail. When these are combined together, they create a business model where virtual assistants can aid customers, dynamic pricing maximises profits, demand is correctly forecast and payment is easy.
Historically, the UK retail giants have been slow to adopt new tech. However, both big and smaller companies will likely be utilising AI soon. The recent trend in high street store closures will give executive leaders an even greater sense of urgency.