The latest retail statistics from the ONS, released this morning, show a continued period of growth for the sector as a whole. Online sales continue to dominate, with a year-on-year increase of 9.4% when compared with February 2018. Non-store retail saw the strongest month-on-month growth at 1.4%. While online sales as a proportion of all retailing fell from 18.8% to 17.6%, the upward trend is clear.
Much has been made of the prospects of the high street, but the forecast need not be entirely pessimistic. Granted, one of the advantages of online stores is that the virtual shop can be changed and adjusted continuously. And, crucially, it can be personalised for everyone.
Learnings from the behaviours of customers online can then be taken in-store, helping retailers optimise store layouts, the positioning of products, and even the customer experience. We see this implementation of artificial intelligence (AI) as one of the big changes about to hit the retail sector.
As such, AI is giving retailers with physical stores a fantastic opportunity to differentiate from their competitors through optimised supply chains and personalised customer journeys, and there is no doubt that this technology needs to be harnessed if they want to match the capabilities of e-commerce retailers.
The good news for retailers yet to embark on an AI project is that the technology is easier to access than ever, and its benefits are plain to see. There is no reason why traditional, long-standing brands can’t harness the power of AI to capitalise on the digital retail revolution. In fact, with legacy brands comes a vast amount of data to draw insights from which is a goldmine for AI that younger, more agile retailers don’t have.
Businesses using AI are growing 30% faster than those that are not. It increases profit margins by 50% and improves inventory stock days by 9%. Overall, AI is predicted to pump an additional £27 billion into the UK retail market each year.
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