The Riverbed Global AI & Digital Experience Survey offers a comprehensive perspective of AI adoption in retail with trends, gaps and practical approaches
Riverbed, leader in AI Observability, communicates the results of the Riverbed Global AI & Digital Experience Survey on the use of new technologies in the food sector retail services. The survey found that 96% of business and IT leaders agree that AI will have a major impact on delivering a better digital experience for customers. Furthermore, 95% of those interviewed say that AI is among the board's priorities and 84% agree that it ensures competitive advantages. In a frenetic sector, the ability to use AI to personalize products and services, revolutionize logistics and manage peaks in demand such as Black Friday and Cyber Monday proves successful.*
Despite the enthusiasm, however, only 40% of retailers are ready to implement AI projects, as organizations face challenges ranging from data quality to scalability that impact their ability to exploit its full benefits. However, rapid expansion is expected over the next three years, and by 2027, 93% of retail leaders believe their business will be ready to implement AI. A figure higher than the average of other sectors, where 86% expect to be ready for AI within three years.
Currently, 54% of retail business and IT leaders say the primary reason for using AI is to increase operational efficiency over growth (46%). However, over the next three years, the numbers will reverse, with 56% of organizations believing that AI will impact growth rather than efficiency (44%).
Gen Z and Millennials in retail demonstrate expertise with AI
The survey found that enthusiasm for AI is high among management, younger generation employees and organizations as a whole.
– Today, 71% of retail leaders say AI is a strategic priority for their organization, while another 29% say it is moderately important.
– There is strong enthusiasm for the adoption of AI in retail organizations, with 64% saying they have a positive feeling, 33% are neutral and only 3% are sceptical.
– Across industries, Gen Zs are perceived as the standard-bearers for AI, but Millennials are also believed to be comfortable with the technology. When asked which generation is closest to AI in the office, leaders pointed to Gen Z (47%) and Millennials (46%), followed by Gen X (6%) and Baby Boomers (1%).
The research found that the majority of retail organizations have already moved beyond AI experimentation and that 65% are accelerating investments in infrastructure and talent, while another 25% are already integrating AI into business processes.
Digital User Experience is a priority for Retail
The previous investigation Global Digital Employee Experience (DEX) Riverbed's 2023 report outlined DEX as a critical objective for enterprises, especially as the digital expectations of Gen Z and Millennials, who represent approximately half of the global workforce, increase. This year's survey confirms the role of AI in DEX, given that 91% say that AI is important to offer a better digital experience to users. Over half (53%) of retail organizations are achieving improved DEX with 24/7 support (such as chatbots and virtual assistants).
Respondents report using AI in the IT team to improve DEX within 3 years includes: automated remediation (76%), 24/7 support availability such as chatbots (71%), workflow automation (68%), data analytics (64%), and feedback analytics (61%).
Despite the benefits of AI, gaps in retail are highlighted
The research highlights three gaps that need to be overcome to ensure AI delivers benefits, such as:
– Reality Gap. The majority of respondents (84%) believe they are ahead of their competitors (including 35% who say they are significantly ahead) in adopting AI for IT services and DEX, and only 4% say they are slightly behind. The gap between perception and reality means that many leaders are overconfident about where they are on the AI journey compared to their industry peers.
– Readiness Gap. Only 40% of retail leaders say their organization is already ready to implement AI. Additionally, 77% say that because AI is still maturing, it is difficult to implement in a working, scalable way.
– Data Gap. Nearly all retail leaders (87%) recognize that data is critical to effective AI. However, of those surveyed, 72% are concerned about the effectiveness of their organization's data for using AI and only 45% rated their data as excellent in terms of accuracy, while 42% say data quality is a barrier to further investment.
Concerns about data security risks are also growing in the sector, with 91% fearing that AI could allow access to proprietary data. Since the retail industry handles sensitive consumer data, it is critical to adhere to data protection regulations and minimize the risks associated with leaked customer information.
“As retailers prepare for promotional sales seasons like Black Friday and Cyber Monday, the adoption of AI technology is revolutionizing retail, offering personalized recommendations and superior shopping experiences,” explains Jim Gargan, CMO at Riverbed. "However, leveraging AI to analyze consumer purchasing behavior and trends requires access to good data, and our survey reveals that only 45% of business and IT leaders in retail organizations rate their data as excellent in terms of accuracy. At Riverbed we are helping customers close this data gap through a hands-on approach, with an AI-powered platform that provides visibility into their entire IT environment. As a result, this improves employee experience and productivity, which in turn delivers superior experiences to customers, ultimately increasing loyalty and sales for retailers.”
Successful AI initiatives in retail
Companies are acting in different ways to overcome challenges and promote AI strategies that produce tangible results. To prepare for the adoption of AI, 55% of organizations in the retail sector have formed specialized teams and 50% have teams dedicated to observability and/or user experience aspects. For this industry, investing in AI talent is a priority, and retailers are hiring data scientists, AI specialists and engineers to maintain a competitive edge in a rapidly changing environment.
Retailers are exploring other initiatives to drive effective AI integration. When it comes to data, the vast majority of retail leaders (88%) say that using real data, rather than synthetic data, is critical to improving the digital experience. Additionally, 86% of respondents agree that observability of all elements of IT is important in an AIOps strategy, and that observability to overcome network blind spots – including the public cloud (86%), company-owned mobile devices (85%), Zero Trust architectures (83%) and remote work environments (82%) – is extremely or moderately important.
Methodology
The Riverbed Global AI & Digital Experience Survey surveyed 1,200 IT, business and public sector leaders across seven countries and seven industries, all with more than $250 million in annual revenue (over $500 million in the US, UK and France), providing a snapshot of how companies are adopting AI. Industries included are manufacturing, financial services, retail, government/public sector, healthcare providers, energy and utilities, and transportation and airlines. In total, 200 decision makers from the retail sector were interviewed. The survey was conducted by Coleman Parkes Research in June 2024.
