Generative AI Study: This Is What Nearly Half of Retailers Get Wrong – WWD

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Fashion, beauty and other retail businesses are eager to latch onto the creative talents of generative AI — a tech that can spawn impressive works of writing, photos, audio and video. But they may be too eager, according to the latest study from Salesforce, announced Monday.

Apparently a significant portion of the world’s retail operations are taking up this particular artificial intelligence in droves, but many are missing the one thing they need to really pull it off — connecting all of the relevant data they have to those machines.


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The report, a joint effort between the San Francisco-based tech company and the Retail AI Council, surveyed 1,300 global retailers and found that 93 percent are already using generative AI for personalization, like customized product copy and shopping recommendations. As much as 81 percent said they have a dedicated AI budget, and half of that on average is earmarked for generative AI.

And yet, Salesforce found that nearly half “are struggling to make their data accessible, and just 42 percent are connecting their various data silos” — which is a significant red flag, given that this tech feeds off of data to perform.

This scenario, according to the announcement post, “can lead to ineffective or inaccurate artificial intelligence (AI) outputs.”

Rob Garf, general manager of retail and consumer goods at Salesforce, put it this way: “The AI revolution is about data, trust and customer experience. Looking at AI in isolation, without understanding these elements as a package, will hurt a retailer’s ability to build loyalty and improve customer relationships.”

Maybe it’s a sign of the times. Over the years, the sheer volume of shopping data has ballooned as the number of commerce channels grew and businesses reached out to more consumers in more places and in more ways. However, instead of using this valuable trove of information most effectively, this firehose of data becomes an opportunity lost when companies fail to literally connect the dots.

After all, even the best athlete in the world could hardly be expected to win a race — and that’s precisely what retail finds itself in right now. More specifically, it’s a sprint, as opposed to a marathon.

Salesforce cited a projection from research analyst firm IHL Group, which predicted that generative AI will have a $9.2 trillion impact on retail by 2029, as brands get their arms around the tech. This form of artificial intelligence excels at learning and then generating creative works, from text to photos, audio and video, so businesses are excited to use it to personalize and improve shopping experiences, the tech company said. It urged retailers to do some housekeeping by creating “a unified data strategy.”

Other nuances from the study:

  • The retail executives in this survey expect that almost half of their employees, at 45 percent, will be using generative AI by the end of next year. More than a third, at 36 percent, already do.
  • The top destinations for this tech in retail are customer service, marketing and operations. The use cases span personalized, automated messaging and conversational AI shopping assistants that can speak and understand natural language.

Sounds great, at least for half of the retail sector. The other half is going to be busy getting their data houses in order.

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