Retail’s foray into the world of artificial intelligence has been a free-for-all.
It doesn’t matter if they’re selling $35,000 ostrich leather handbags or chicken feed for 90 cents per pound, companies are trying to figure out how to integrate A.I. into all parts of their business, from chatbots at checkout, supply chains and security to advertising, inventory management, product design and hiring.
The industry was caught off guard by Amazon’s e-commerce revolution more than 20 years ago and doesn’t want an encore. That’s why, during a major retail summit in New York this week, two of the world’s most powerful executives declared that artificial intelligence would define a new age of shopping.
John Furner, the incoming chief executive of Walmart, sat alongside Google’s chief executive, Sundar Pichai, onstage at the National Retail Federation conference and announced that together the two companies would rewrite the playbook for how all retailers sold their products. They spoke of a future where A.I. would drive the entire shopping experience, guiding consumers from the moment they began searching for what to buy, all the way to checkout.
“What’s ahead for both of us?” asked Mr. Furner, who will step into Walmart’s top job on Feb. 1. “This is the era of A.I.”
Hundreds of start-ups are also vying for the attention of those retailers, aiming to capture their most granular of needs. There are A.I. start-ups that offer in-store cameras that can detect a customer’s age or gender, robots that manage shelves on their own and headsets that give store workers access to product information in real time.
“Everybody talks about A.I. every five seconds,” said Max Magni, the chief customer and digital officer at Macy’s. “We used to say it was going to be a drinking game.”
On the expo floor, some tech executives wondered aloud how many of these businesses would survive. A July study from M.I.T. found that even though third-party A.I. tools were more helpful than ones built internally, most companies — across all industries — weren’t using artificial intelligence programs at a significant scale.
At the same time, incumbent tech giants are trying to establish their turf in an expanding market. During Sunday’s N.R.F. keynote, Mr. Pichai personally courted the retail industry en masse for the first time, announcing a new open-source protocol from Google that can power a brand’s A.I. agents.
Agentic A.I. is everywhere
No retail buzzword has become more pervasive than “agentic.” It refers to the autonomous bots that guide shoppers through a purchase, helping them research products, find deals and check out. They have popped up across the industry, and the executives behind them couldn’t help showing off their new digital toys at the three-day event.
Companies have even given these new companions names. Walmart’s A.I. shopping assistant, which can help find items, plan events and prep meals, is called Sparky. Amazon’s is called Rufus.
At Ralph Lauren, you can “Ask Ralph.” The designer brand’s virtual shopping assistant, developed with Microsoft, is stylized with a portrait of Ralph Lauren himself, so you can ask an A.I. version of the billionaire businessman what you should wear to your friend’s wedding. David Lauren, the company’s chief innovation officer and a son of the founder, said the service was initially intended to attract tech-forward shoppers.
“Our first Ask Ralph that we built was really with Bill Gates in mind,” David Lauren said. “Of what we thought he might use as a tool to get dressed.”
Most retailers have insisted that they want to use A.I. to make their employees’ jobs easier, not to replace them with some autonomous computational entity.
LVMH, the world’s largest luxury retailer, said it used A.I. to boost creativity among its designers, helping them explore materials, test colors and visualize final products. Gonzague de Pirey, LVMH’s chief omnichannel and data officer, acknowledged that it was a sensitive topic in the luxury sector, but said the company was trying to “embrace this topic of A.I. creativity.”
“A.I. is a tool that helps everyone to be better,” Mr. de Pirey said. “So it’s our duty to use it to do better.”
The scramble to exploit artificial intelligence is happening across the retail spectrum, from the highest echelons of luxury goods to the most pragmatic of convenience stores.
7-Eleven said it was using conversational A.I. to hire staff at its convenience stores through an agent named Rita (Recruiting Individuals Through Automation). Executives said that they no longer had to worry about whether applicants would show up to interviews and that the system had reduced hiring time, which had taken two weeks, to less than three days.
“Our candidates are talking to Rita,” said Rachel Allen, 7-Eleven’s head of talent acquisition. “They love Rita. Even though we say Rita is an A.I. assistant, they still want to meet her.”
Among the other businesses that presented their latest A.I. advancements at the event: Applebee’s, IHOP, the Vitamin Shoppe, Urban Outfitters, Rag & Bone, Kendra Scott, Michael Kors and Philip Morris.
But what if it gives bad advice?
There’s still an underlying fear, however, that A.I. will simply mess things up.
Tractor Supply is using A.I. for customer service and curbside checkout. The company, which sells things like hay horse feed, chain saws and 1,500-pound excavators, wants to be sure to provide A.I. service that knows what it’s talking about when it’s making recommendations, with as much proficiency as a trained worker would have.
“Store members have expertise in welding, in how to take care of chickens, in equine — that has established trust with our customers,” said Glenn Allison, Tractor Supply’s vice president of A.I. platforms. “Anything we do from an A.I. standpoint has to have that trust.”
Home Depot has started using generative models to create ads and has been careful to ensure that everything is accurate. For a home improvement store, videos that display products must show how to use them correctly; the company doesn’t want people to misuse a power drill or an angle grinder after watching an A.I. video that was inaccurate.
“The usage of the product is important to you, so nobody is cutting off their hand with a saw,” said Hannah Elsakr, vice president of GenAI new business ventures at Adobe, which works with Home Depot.
“The saw thing is really real,” added Stacie Santana, Home Depot’s senior director of marketing. “We’re really sweating the details.”
Kim Bhasin is a business reporter covering the retail industry for The Times.
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