A new study from Juniper
Research found that the global spending by retailers on AI services
will reach $12 billion by 2023, up from an estimated $3.6 billion in
2019. Juniper expects over 325,000 retailers to adopt AI technology over
the period.
According to the new research, AI
in Retail: Segment Analysis, Vendor Positioning & Market Forecasts
2019-2023, AI use by retailers will unlock efficiencies across back
office operations. Advanced analytics employed in functions such as
demand forecasting and automated marketing will make retailers more
agile and improve margins.
Juniper forecasts that retailers will face an AI adoption race, where
AI-equipped retailers, which have adopted systems as early movers, will
displace slower moving retailers, offering superior service at optimised
price points.
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Demand Forecasting Crucial to Retailer Success
The use of machine learning in demand forecasting will prove to be a key
market for AI vendors, with associated service revenues reaching $3
billion by 2023, up from $760 million in 2019.
The research claimed that demand forecasting will be essential to enable
an effective omnichannel experience and drive higher margins. This will
mean the number of retailers using AI-enabled demand forecasting will
more than triple between 2019 and 2023.
Research author Nick Maynard explained: “With the rise of
collect-in-store and one-off events such as Black Friday, understanding
demand and supply chains is more crucial than ever with AI playing the
central role”.
Smart Checkout Technologies Set for Rapid Growth
The research also found that smart checkouts, largely powered by AI
technologies such as computer vision, will have a strong future in the
convenience area; leading to annual transaction volumes of over 1.4
billion by 2023, compared with just 42 million in 2019.
While Amazon is currently highly visible with its Go model, China will
be the biggest driver of future growth. This reflects the rapidly
growing Chinese market, as well as the backlash Amazon has had recently
due to its cashless model.
Juniper Research provides research and analytical services to the global
hi-tech communications sector; providing consultancy, analyst reports
and industry commentary.
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