New survey results exclusively released to Chain Store Age reveal just how important retailers view artificial intelligence (AI) and machine learning (ML).
About two-thirds (65%) of retail respondents to a recent survey sponsored by end-to-end, multi-cloud technology solutions company Rackspace Technology said AI and ML are technologies that are among the most mission-critical to their business strategy. This led other technology areas such as cybersecurity (63%), cloud computing (60%), data science (57%), and e-commerce (53%)
Almost six in 10 (58%) respondents in the retail space said AI/ML technologies are a high priority for their industry. More than seven in 10 said AI/ML has had a positive impact on revenue generation (72%) and on expense reduction (72%), while 69% reported AI/ML has had a positive impact of on brand awareness, and 67% said these technologies have had a positive impact on brand reputation.
Three-quarters of respondents in retail say they are employing AI/ML as part of their business strategy, IT strategy or both; while 68% of retail respondents are allocating between 6% and 10% of their budget to AI/ML projects. This compares to a reported spend (as a percentage of overall budget) of between 1% and 10% in the 2020 edition of the survey.
AI/ML projects are accelerating in the retail sector
The survey reveals that AI/ML solutions are being used by retailers in an increasingly wide variety of contexts, including improving the speed and efficiency of processes (47%), personalizing content and understanding customers (43%), understanding marketing effectiveness (42%), gaining competitive edge (42%), increasing revenue (41%), and predicting performance (32%).
In what Rackspace says is an indication of the increasing maturity of the technologies, 66% of retail respondents said their AI/ML projects have gone past the experimentation stage and are now either in the "optimizing/innovating" or "formalizing" states of implementation. The survey additionally shows that most organizations are also citing a wider range of use cases, including computer vision applications, automated content moderation, customer relationship management, and biomedical applications.
- 34% of retail respondents cite difficulties aligning AI/ML strategies to the business.
- From a talent perspective, more than six in 10 (61%) retail respondents said they have necessary AI/ML skills within their organization. At the same time, more than half of all respondents say that bolstering internal skills/hired talent and improving both internal and external training are on their agenda.
“As AI/ML budgets continue to increase, we are seeing projects proliferate across more areas of the organization, and it’s clear that the AI/ML is advancing in its importance and visibility,” said Jeff DeVerter, chief technology evangelist, Rackspace Technology. “At the same time, the research makes clear that many organizations still struggle with getting stakeholder buy-in, addressing issues of data quality, and finding the skills, resources and talent to take advantage of the AI/ML’s full potential.”
To download a copy of the full report, click here. The survey was conducted by Coleman Parkes Research in September 2021. Findings are based on the responses of 1,870 IT decision-makers across manufacturing/logistics, retail, hospitality/travel, energy, healthcare/pharma/biomedical, government, media/entertainment and financial service sectors in the Americas, Europe, Asia and the Middle East.