The modern retail experience is increasingly shaped by artificial intelligence working behind the scenes. From the moment a customer opens a retailer’s app to the point they receive their delivery, AI is optimizing every touchpoint — personalizing recommendations, managing inventory, routing orders, and predicting what customers will want before they know it themselves.
Personalization engines powered by AI have become table stakes in retail. Amazon’s recommendation system, which drives an estimated 35% of the company’s revenue, was an early example. Today, even mid-market retailers are deploying similar capabilities through platforms like Dynamic Yield, Algonomy, and Bloomreach, using machine learning to tailor product assortments, search results, and promotional offers to individual shoppers.
Computer Vision in Stores
In physical retail, computer vision is enabling frictionless experiences. Amazon’s Just Walk Out technology — now licensed to third-party retailers — uses ceiling-mounted cameras and AI to track what shoppers pick up, automatically charging their accounts when they leave. While fully autonomous checkout remains in its early stages, AI-assisted self-checkout systems that use computer vision to verify items are already reducing shrink and speeding throughput at scale.
Shelf monitoring is another high-impact application. AI-powered cameras and robots continuously scan store shelves, detecting out-of-stock items, misplaced products, and pricing errors in real time. Retailers using these systems report 2-4% revenue lifts from improved on-shelf availability alone.
The Omnichannel Intelligence Layer
Perhaps the most transformative application is AI as the orchestration layer across omnichannel operations. When a customer places an online order, AI determines whether to fulfill it from a distribution center, a nearby store, or a dark store based on real-time inventory levels, delivery distance, labor availability, and cost optimization. This dynamic fulfillment routing has become essential for retailers competing with Amazon’s delivery speed expectations.
Retailers that treat AI as a strategic capability — investing in data infrastructure, talent, and organizational alignment — are pulling away from competitors who view it as a technology experiment. The gap will only widen.