Ottawa, Dec. 23, 2022 (GLOBE NEWSWIRE) — The global artificial intelligence (AI) in retail market size was accounted at USD 8.41 billion in 2022. The growing demand for better security and monitoring in offline stores and increased knowledge of using AI in retail will drive market growth.
The solution segment currently dominates the market based on components. Smart retail, digital commerce, in-depth customer insights, intelligent delivery, and smart supply chain are being evaluated as robust solutions for development. The retail business is expected to adopt new and creative automated solutions due to the growing difficulties in managing diverse retail activities. This is anticipated to accelerate the use of AI in the retail sector.
On the other hand, services are projected to experience tremendous growth due to the rapid adoption of AI services in retail. Services are anticipated to witness a significant increase during the forecast period. Speedy adoption of AI solutions is growing the demand for services for intelligent functioning, enhancing consumer experience, improving revenue potential, enabling rapid innovation, and reducing human error.
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Based on technology, machine learning is estimated to hold the largest share of revenue in the global market. The segment dominates the market as machine learning quickly provides deep insights from collected data and helps provide customers with personalized experiences. It assists retailers in optimizing supply chain plans and demand forecasts to increase inventory productivity. Similarly, AI-powered computer vision is being used to extract information from facial recognition and video searches. Thus, computer vision is also rising in the retail industry.
Sales Channel Insights
The pure-play online retailer segment significantly increased revenue based on the sales channels. The expansion of pure-play internet businesses is expected to accelerate as online, and virtual purchases become more widely accepted. The popularity of social media, IoT, and AI, would all increase, boosting AI in the retail sector. Besides the pure-play segment, omnichannel and brick-and-motor segments are also expected to show substantial revenue growth in the upcoming future.
A growing need for enhanced client involvement has led to significant growth in customer relationship management (CRM). Thus, the CRM segment shows a rapid increase in AI in retail. Retailers can retain solid client relationships and loyalty with AI-driven virtual assistance (VA), search engines, chatbots, and other tools. Due to the erratic and quick changes in consumer purchasing behaviour, there is an increasing demand for AI in market prediction. AI for visual monitoring & surveillance of stores is also anticipated to rise steadily. Ongoing tracking provides robust security and gathers information about customers, alerts for shelf replenishment, face recognition, and controls for fraud & shrinkage.
The North American region dominates the global revenue share for artificial intelligence (AI) in retail market. To improve customer service effectiveness, area merchants are concentrating on obtaining data on client preferences that are currently available. The US was a leader in the early adoption of AI technology and is now seeing significant investment in this field. Due to the nation's growing need for technology, new start-ups and small businesses are also sprouting. For instance, e-commerce shopping platforms are becoming more popular throughout the region. Online retailers frequently utilize automated merchandising to anticipate their customers' product preferences based on past purchases and present them with relevant products.
Asia Pacific is predicted to experience rapid growth in artificial intelligence in the retail market. The region's growth results from technical development in nations like China, India, and Japan. The major drivers of the growth of the Asia Pacific AI in retail market are the rapid uptake of smart devices and the broad application of 5G technology in the retail industry.
Likewise, Europe is expected to dominate the artificial intelligence retail market in the near future. Amongst the European countries, the UK is positioned to lead the market. Several AI-based businesses and a robust ecosystem of investors, clients, and knowledgeable specialists provide it with a competitive edge in the artificial intelligence market. Market expansion will be aided by big companies increasing their retail spending and research & development efforts.
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Scope of the Report
Market Driver: Increasing Demand for Enhanced Consumer Experience with AI-Powered Chatbots
AI Due to its incredibly effective customer service, AI-powered chatbot help is becoming increasingly popular throughout the retail sector. Customers' experiences are improved by the dedicated and tailored responses provided by chatbots. Natural language processing (NLP) and machine learning technologies support AI chatbots. These technologies offer current information on customer preferences. Additionally, it aids the chatbot in comprehending the attitudes and behavior patterns of the users, which helps it respond to customer inquiries and foster relationships. For instance, the global apparel retailer H&M created a chatbot for the messaging app Kik that serves as a virtual stylist as an addition to its online store. Every user receives personalized wardrobe suggestions from the bot. Thus, the AI-driven chatbot is expected to drive artificial intelligence in retail. As a result, it is anticipated that the AI-driven chatbot will propel AI in the retail industry sector.
Market Restrain: Confidentiality Concerns Related to AI Implementation.
Advanced data mining techniques collect data on various factors, including purchasing patterns, online activity, and payment information. For instance, e-commerce behemoths like Amazon utilize machine learning to forecast customer buying behavior and give product recommendations based on past purchases. They do this by combining collaborative filtering and next-in-sequence models. Amazon has access to a vast database of customer purchasing patterns to improve its forecasts. Due to the likely significant influence of AI on personal privacy, privacy concerns are anticipated to pose a hurdle to artificial intelligence in the retail sector.
Market Opportunity: Technological Advancement in Retail Industry
Due to its highly effective customer service, chatbot help powered by artificial intelligence will become increasingly popular in retail. Customers receive thoughtful, individualized responses from this chatbot, which raises customer satisfaction. Computer vision and other technological developments in the retail industry are becoming more popular in brick-and-mortar stores. AI deep learning in retail that translates and "sees" visual data is known as computer vision. This development creates possibilities for new retail in areas such as customer experience, demand forecasting, and inventory management.
Key Development in the Artificial Intelligence (AI) in Retail Market
Segment Covered in the Global Artificial Intelligence (AI) in Retail Market
By Sales Channel
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