Key takeaways from Forrester Research's GenAI and retailers report...

Generative AI (genAI) is showing potential in transforming the retail sector, with applications ranging from customer-facing chatbots to internal automation, though its true impact on business performance remains uncertain at this early stage.

SUMMARY

GenAI Applications in Retail: Retailers are experimenting with genAI across various use cases, including back-office and consumer-facing applications. Key examples include Amazon's Rufus, Carrefour’s Hopla, and Lowe's Product Expert, which are designed to assist shoppers. Many retailers are focusing on internal tools for store associates, such as The Home Depot's assistant and Target's Store Companion.
Workplace Automation: GenAI is increasingly used to enhance employee productivity, with tools like Walmart's My Assistant and Nestlé's NesGPT, aimed at streamlining tasks such as document drafting and summarization. Over half of retail AI decision-makers are focusing on AI for employee productivity in the coming year.
Content Creation & Product Ideation: Retailers are using genAI to produce product descriptions, imagery, and even brainstorm new products. Amazon uses genAI to generate images and summaries of product reviews, while PepsiCo uses it for product personalization and new flavor creation. A majority of decision-makers believe genAI will impact product and service offerings in the next two years.
Cautious Optimism for Growth: While genAI initiatives are active, few companies have reported significant business growth linked to its implementation. The benefits of genAI are still perceived as intangible in many cases, with companies like IKEA acknowledging that results are likely to be realized over time.
Pragmatic Expectations for GenAI: Retailers are advised to be realistic about what genAI can and cannot achieve. It is useful for tasks like idea generation and answering basic questions but still not capable of core retail operations like sourcing, manufacturing, or delivery. Retailers should stay informed about the technology’s rapid development and focus on practical applications rather than adopting genAI for publicity.
Governance & Compliance: With the rise of genAI, retailers must prioritize governance to manage risks associated with data privacy, copyright issues, and ensuring the quality of AI-generated output.

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