This retailer is tops in AI usage...
A new industry-first index reveals the retailers leading their peers in extensively and effectively adopting artificial intelligence.
Amazon, Walmart and Stitch Fix top the ranking of the 100 leading retailers and brands that are embracing AI to drive impact across their organizations. The "2024 Retail AI Index,” from technology platform Lily AI and strategy consultancy Radii Group, evaluated retailers across four dimensions, including talent/operations; company/financial; technical; and news/media. (See methodology at end of article).
The top 10 retailers are listed below.
- Amazon
- Walmart
- Stitch Fix
- eBay
- Wayfair
- Sam’s Club
- Target
- The Home Depot
- Macy’s
- Nike
The index revealed that retailers leverage a diverse array of AI technologies, including computer vision and generative AI, to enhance operational efficiency. Retailers and brands are also harnessing AI to bolster decision-making, boost sales through improved customer experiences, and optimize marketing initiatives.
Index analysis showed no clear correlation between a retailer’s index rank and its overall revenue, which suggests retail is still in nascent stages of AI integration and it is too early to see the full financial impact, according to Lily AI.
Standout Retailers
- Some companies with higher index rankings have acquired or joined in strategic partnerships with AI firms, such as fifth-ranked Wayfair’s acquisition of ThirdAI and 20th-ranked Ikea’s investment in Waaabi, a generative AI autonomous truck company.
- Poshmark, ranked #18, recently introduced an AI-powered tool called Promoted Closet which uses machine learning to match shoppers’ search terms with promoted listings.
- Revolve, ranked at #19, sold AI-designed clothing on its website in partnership with AI Fashion Week. The online fashion retailer showcased three collections created using AI image generators such as Midjourney and Stable Diffusion.
- According to Lily AI, third-ranked Stitch Fix stands out because it leverages several AI-based technologies to deliver personalized shopping, building on its original business model of tailored/recommended clothing bundles and demonstrating how mid-size companies can adopt AI with focused investments while building on existing data and models.
[READ MORE: Stitch Fix offers personalized holiday styling help]
"AI continues to empower retail leaders to reshape and modernize the customer experience, and it’s critical for all retailers to understand where they stand," said Purva Gupta, co-founder and CEO, Lily AI. "AI is becoming table stakes for retailers who want to stay competitive. Not surprisingly, the biggest of the bigs, Amazon and Walmart, have the resources to invest in AI extensively. But, as we found, even relatively smaller companies, such as Poshmark and Revolve, are taking highly innovative approaches and reaping the benefits."
METHODOLOGY
The Retail AI Index is a quantitative meta-analysis of the adoption of AI technologies that benchmarked retailers in the apparel, footwear, beauty, and home segments. It combines thousands of publicly available data points from first-party and third-party sources, including public filings, earnings calls, investor presentations, LinkedIn, Meltwater, Indeed, and BuiltWith.
Retailers were selected based upon criteria including revenue size, category focus, and geographic focus. Benchmarking parameters included an evaluation of each retailer across four dimensions:
- Talent/Operations—measuring internal capabilities through the number of employees, the proportion of AI talent relative to total employees, and AI-related job roles and postings.
- Company/Financial—gauging historical and future investments in AI by analyzing financial documents and earnings calls for mentions of AI-related terms.
- Technical—evaluated the implementation of AI technologies on retailer websites, categorizing applications into levels of AI adoption including automation, analytical AI, personalization, and generative AI.
- News/Media—assessed AI-related marketing initiatives and media presence the analysis of media mentions and press releases.
