AI is empowering the retail industry to boost top-line growth and margins by leveraging the key assets of retail businesses: their customers’ base and knowledge as well as the multiple touchpoints they have with their customers.
AI’s influence on retail is massive, with retailers experiencing up to +7-10% topline uplift and a +2-5pts increase in operating profits. This impact is set to grow exponentially as more advanced solutions are developed and adopted.
At Advancy, our role is to simplify AI adoption for our clients, ensuring it drives meaningful value creation and securing in-depth change management. From our experience, 3 specific AI applications have proven to deliver substantial impact:
1) Individual-tailored Activation: 360-degree AI-driven insights on customers’ purchasing and browsing behaviors empower precisely targeted campaigns, driving step changes for our clients in customers’ lifetime value and delivering optimized ROI on client activation investments.
- Advancy client case study: combination of a Single Customer View with AI-driven customer insights for targeted communication campaigns.
- Results: +3pts of Advancy client’s share of wallet, x2 in communication campaigns’ ROI
2) Precision Merchandising: Using AI to refine product selection and optimize space, our clients drive sales growth and improve supplier quality management, tailoring offerings to local customer preferences.
- Advancy client case study: in-store products’ price/volume/mix optimization to reduce markdown in sales period.
- Results: +2pts of incremental margin
3) Optimized Demand Planning and Efficient Inventory Management: By leveraging AI-powered predictive sales analytics, our clients reduce time-to-market, inventory levels and ease cash-flow pressures. Intelligent route and task planning enhances agility, enabling faster responses to evolving customer demands.
- Advancy client case study: faster product collectioning process leveraging AI-generated visuals for communication with suppliers and AI-generated product sheets.
- Results: client’s product teams focused on higher value-added tasks, -1 month in prototyping time
At Advancy, we are a key link between AI innovators and retail, helping clients achieve a smooth and impactful transition rooted into our clients’ organization with our experts Vincent Delaeter, VP performance and change management, and Hamza Benhaddou, Principal in the Advancy Retail practice.
AI is a transformative driver for retail, making companies more agile and resilient. In the coming weeks, we will dive deeper into these 3 AI applications in retail.
Publication by:
Laurence-Anne Parent