While still in its relative infancy, given the buzz and excitement around artificial intelligence, or AI, you would be forgiven for thinking it has been around much longer. In honesty, AI has been bubbling close to the surface for some time, and we have seen glimpses of its potential in certain forms such as online chat bots and smart speakers.
However, over the past few years, AI has drawn the attention of the masses, with tools such as ChatGPT now a go-to essential for many, while others are making use of built-in AI within social media platforms such as Facebook and X. To put it simply, there is no escaping AI in some form.
With this in mind, Retail Focus casts a focused eye on the retail sector to address some of the primary concerns about the impact of AI and what this technology can do to support those working in and around the industry. Is it the be-all and end-all, or just another option now available to retailers?
Unlock unprecedented opportunities
First up, Ruth Harrison, global retailer and consumer goods lead at Avanade, acknowledged how AI dominated the retail conversation during 2025, promising everything from smarter merchandising decisions and resilient supply chains to hyper-personalised customer experiences. However, she said, in reality, sustainable value from AI only materialises when foundations are strong,
“This year, one of the biggest challenges retailers faced was building those foundations: ensuring data is accurate and trustworthy, modernising cloud architecture, and deploying ERP systems that are stable, integrated, and ready to scale,” she said. “Without these essentials, even the most advanced AI strategies risk falling short.
“In 2026, AI is set to unlock unprecedented opportunities for both retailers and consumers, but only if they focus on the most effective areas for AI adoption. One priority will be delivering superior customer experiences through smarter, more agile operations, starting with a single source of truth, robust security, and operational readiness to scale high-impact AI use cases.
“Success will also hinge on a clear automation strategy, knowing when to leverage off-the-shelf AI agents and when to invest in custom solutions tailored to unique business needs. For those who get it right, the year ahead will redefine engagement and satisfaction at every touchpoint.”
With this, Harrison drew attention to the so-called ‘Golden Quarter’ of retail, better known as the Q4 period that includes Black Friday, Cyber Monday and Christmas. She said the most successful retailers will have created meaningful conversations, not just selling products.
“By weaving AI-powered dialogue into the customer journey, retailers can recreate the warmth and personalisation of the most seamless in-store experiences, but at scale,” she said. “In addition to this, conversational commerce isn’t only transforming how customers shop, it’s also revolutionising the store associate experience. With AI-powered tools at their fingertips, sales assistants can serve customers smarter, faster and more personally than ever before, elevating the shopping experience for everyone.”
Strategic opportunity
Candice Mayer-Gillet, managing director at Westfield Rise, had similar thoughts on AI in terms of implementing it as part of a wider strategy. She said the widespread adoption of AI presents a “strategic opportunity” for connecting brand experiences across physical and digital realms.
“In shopping centres like Westfield Shepard’s Bush, we are now exploring how AI can provide retailers with data-driven insights into the customer journey, informing departments across marketing, operations, merchandising, and research,” she said.
“In 2026, the challenge will be to ensure the adoption of an interoperable technology stack, enabling the necessary data to flow across departments without becoming siloed. Once this foundation is set, the adoption of AI solutions will drive seamless campaigns, even as disciplines continue to blend, enabling improved efficiency, optimised layouts, stock management, and the design of consumer experiences that feel personal and relevant to each consumer.”
So, what will the ‘true’ omnichannel experience look like in 2026? Mayer-Gillet said as AI streamlines the shopper journey, retailers will gain clearer and more decisive insights, this allowing them to strategize with consumer values in mind.
“Through this lens, AI can support creativity, expanding the canvas without losing trust,” Mayer-Gillet said. “The brands that progress most will not be the ones that automate everything, but the ones who use AI responsibly to unlock ideas and improve clarity while keeping imagination at the heart.”
Shifting role of retailers
Elsewhere, Nikhita Hyett, general manager EMEA at Signifyd, highlighted the surge in the use of AI agent-enabled shopping and agentic commerce. She said shoppers no longer need to visit a retailers’ website, instead outsourcing to agents to save time and find the best deals.
If AI agents become the primary intermediary between shopper and shop, Hyett said the industry can expect the role of the retailer to shift dramatically, with customer experience no longer designed for human emotions and intuition, but instead algorithmic decision-making, fundamentally changing how retailers compete and differentiate.
“We are now past the point of viewing agentic commerce as a passing fad,” Hyett said. “The infrastructure behind it, such as large language models, open APIs, embedded wallets, is already evolving as platforms build functionality into their front ends.”
Taking this a step further, Hyett said retailers need to embed themselves into the agent’s reasoning and ensure their payment stack is optimised for these agent-driven transactions. While this, she said, remains something of work-in-progress, it may involve working with platforms on verification protocols, adapting fraud models to detect agent behaviour, and training systems to distinguish good bots from bad.
“Agentic commerce is still new, and while it might intimidate some retailers, it won’t render them obsolete,” she said. “It will, however, change how consumers behave, interact with, and expect from retailers throughout the whole shopping journey. Those who adapt to rethink their role not as curators of the journey, but as verifiable, trusted endpoints of sale will thrive.”
Develop a greater understanding
This point on uncertainty is key. Although AI may sound wonderful and promise a lot, the reality is that it is not a finished product. Professionals across all industries, not just retail, are still learning about what AI is capable of, with ongoing improvements required if you are to not fall short of expectations.
Research from Atradius highlighted this by looking at how 1,000 UK retail decision-makers used AI over the busy Christmas period. Key findings included 90% retailers use AI in some form, with 87% deploying it to manage Christmas peaks and 56% using it months ahead of the festive period.
While adoption was widespread, the report flagged how it is not yet mature. Some 56% of retailers have fully embedded AI across their operations, but 44% remain in pilot stages or planning rollouts. To put it simply, many are still scaling or testing systems, which in turn will leave them more vulnerable to inefficiencies and operational risks.
As for the reason for greater AI adoption, 61% of retailers said customer demand for product availability was the main reason. This was closely followed by personalisation (61%) and faster delivery (59%).
However, there was also an element of concern about AI. Some 66% of retailers expected overall business risk to rise as AI adoption accelerates, particularly around issues such as data privacy, implementation cost and loss of human judgement. In addition, 48% said data security and privacy would be their biggest barrier to AI.
“Retailers are right to see AI as a powerful ally during the busiest trading season of the year,” said Owen Bassett, senior risk underwriter at Atradius UK. “But as automation becomes more embedded in everything from forecasting to fulfilment, it opens new vulnerabilities — from data leaks to supply-chain shocks.
“One failure in a key supplier or a single data-privacy issue can disrupt Christmas trading in ways retailers may not anticipate. That’s why, alongside responsible AI, financial protection is vital – giving suppliers and retailers the confidence to innovate without fear of cash flow disruption when something goes wrong.”
Consumer scepticism
Indeed, while consumer use of AI while shopping is undoubtedly on the increase, there is a lasting concern about the technology and how it is used by retailers. A recent survey of 2,000 shoppers in the UK and Ireland by CI&T flagged a significant gap between consumer expectations and retailer execution.
Of those surveyed, 61% of consumers are using or have used AI when shopping, with 53% doing so often. However, 68% could not name a single AI shopping experience that impressed them. On top of this, 64% wanted retailers to use AI to improve their shopping experiences, but many were sceptical about how retailers are implementing the technology, as trust remains the defining barrier to adoption.
“Consumers are seeking solution-oriented shopping experiences, but discovery and control are still crucial parts of the journey,” said Melissa Minkow, global director of retail strategy and Insights at CI&T. “It is up to retailers to build and be part of the most valuable path to purchase for the shopper, without sacrificing their opportunities for exploration.”
These closing comments offer an apt conclusion to the discussion. While it is true that AI presents retail with all manner of opportunities, there is plenty of work still be done to hone the technology and make it work properly within a shopping environment. New solutions and updates are coming all the time, but it is down to the retailer to ensure they use these advancements to their advantage.
