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Explore the latest trends and actionable insights on the Artificial Intelligence market to inform business strategy and pinpoint opportunities and risks

Market Size of Artificial Intelligence in Retail (2019 - 2021, $ Million)

Industry: Retail
Current: Thematic Indicators

The global market size of AI in retail grew at a CAGR of 12.2% between 2019 and 2021.
Retail companies use AI to identify consumer behavior and deliver personalized marketing
AI in retail industry helps companies make proactive changes to their marketing strategies

Retailers are under increasing pressure to entice customers back into their physical locations as ecommerce sales have grown since the COVID-19 outbreak. Customers now value experiences over products more than ever. Retailers have used artificial intelligence (AI) to enhance consumer experiences and increase operational effectiveness.

AI can fundamentally alter how businesses operate, interact with customers, and offer services. AI is the next step after implementing advanced big data & analytics methodologies, and it has the potential to unlock enormous data quantities if it can access them automatically in real-time with no human involvement. Retailers who adopt AI are entering a new era in which operational procedures are revolutionized by improving activities like answering consumer questions, locating the best suppliers, and modifying prices based on competitors' products and regional demand. Retailers have also adopted AI-integrated personalization as a part of their customer loyalty strategy.

The global AI market in retail increased from $3.2 billion in 2019 to $4.0 billion in 2021, representing a compound annual growth rate (CAGR) of 12.2%. Below are a few example of retailers deploying AI technolgies to gain a competitive advantage.

IKEA: In April 2020, IKEA acquired AI imaging start-up Geomagical Labs to help improve its home visualization tools. Geomagical Labs uses computer vision, machine learning, and AR in a mobile app that allows customers to virtually design their homes.
L’Oreal: By combining AR and lives treaming technologies, L’Oreal is enabling its customers to have a personalized make-up counter experience in the comfort of their own homes. Customers can book a live-streaming appointment with a beauty assistant and have a digital make-up session.
Nike: The Nike Fit app allows customers to scan their feet with a smartphone camera to achieve accurate’ sizing.
Lowe’s: Home appliances retailer Lowe's has used in-store smart robots since 2016. The retailer partnered with Fellow Robots to design the LoweBot, which can answer basic questions inputted via text by employees or customers.

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