AI Offers $340-Billion Cost-saving Opportunity for Retailers: Study

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The study observes that retailers deploying Artificial Intelligence were eight times more likely to be working on high-complexity projects than ‘quick win’ projects that are easier to scale.

Image courtesy – gettingsmart.com

The French technology services major Capgemini in its recent study revealed that the use of Artificial Intelligence (AI) offers multi-billion dollars of cost-saving opportunity for those retail companies that are able to scale and expand the scope of their existing deployments.

As per the survey,the retailers can save more than $300 billion in the future by scaling AI deployments across the entire value chain. However, just one percent of use cases by retailers have been able to achieve this level of deployment till now.

Over a quarter (28 percent) of retailers were found deploying AI in 2018, a seven-fold increase from 2016 (4 percent). AI deployment in retail sector was recorded 17 percent in 2017.The study titled “Retail superstars: How unleashing AI across functions offers a multi-billion dollar opportunity” looked at 400 global retailers that are implementing AI use cases at different stages of maturity. This group of retailers represents 23 per cent of the global retail market by revenue.It also included an extensive analysis of public data from the world’s largest 250 retailers, by revenue.

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Lack of focus on simple, customer-centric deployments

The study shows that retailers deploying AI were eight times more likely to be working on high-complexity projects than ‘quick win’ projects that are easier to scale.It also noted that AI deployments till date lacked a focus on customer usability.The driving forces behind current AI implementations are cost (62 percent) and ROI (59 percent), while customer experience (10 percent) and known customer pain points (7 percent) are significantly lower priorities.

Kees Jacobs, Vice President, Global Consumer Products and Retail Sector at Capgemini, stated that their research shows a clear imbalance of organizations prioritizing cost, data and ROI when deploying AI, with only a small minority considering the customer pain points also. These two factors need to be given equal weighting if long-term AI growth, with all of the benefits it brings, is to be achieved.

Fear of job loss due to AI deployment dispelled  

Contrary to the popular belief that AI deployment may lead to job losses, 71 percent of the retailers surveyed said that AI is creating jobs today, with over two-thirds (68 percent) of the jobs being at a senior level (coordinator level or above).

Meanwhile, 75 per cent declared that AI has not replaced any jobs in their organisation so far. Those who said jobs have been cut accounted for only 25 percent or lower.

 

 

 

 

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