AI investments surge in US retail, yet readiness remains low: Report

Retail professionals across marketing, IT, data and executive leadership, shows that AI adoption is widespread but uneven. Nearly half (45 per cent) of retailers use AI daily or several times a week, mainly across sales, marketing, and customer support. Yet, customer-facing applications—such as personalisation, chatbots, and tailored marketing—remain underutilised, with only 43 per cent currently deploying AI in these areas, Amperity said in its latest 2025 State of AI in Retail Report.

“The results demonstrate the retail industry’s faith in AI’s ability to improve customer loyalty and customer lifetime value—and suggest paths to overcoming the early challenges involved in adopting the technology and realising its promise,” said Tony Alika Owens, CEO of Amperity.

“In a competitive industry and tough economic conditions, any technology advantage could make the difference between success and failure. Retailers that make the most out of AI—applying it to customer-facing use cases that will deliver maximum ROI—could race ahead of the competition in the months and years to come,” added Owens.

While 63 per cent of respondents believe AI can enhance customer loyalty and 65 per cent expect increased customer lifetime value, less than a quarter (23 per cent) are using AI in production to resolve customer identities or prepare marketing data. A major hurdle remains data fragmentation—58 per cent of retailers admit their customer data is incomplete or siloed.

High costs and skill gaps further hamper progress. A little more than half (46 per cent) of retailers cite AI tool costs as a top challenge, and 35 per cent note a lack of technical expertise. Alarmingly, 32 per cent of retailers have provided no formal AI training to employees.

Despite these challenges, the retail industry’s confidence in AI remains strong. Sixty-four per cent say their customer data is structured and accessible enough to support AI, though only 21 per cent are very confident in their ability to understand and act on individual customer behaviour.

A key differentiator in AI maturity among retailers lies in the adoption of customer data platforms (CDPs). Retailers equipped with CDPs are significantly ahead in their use of AI, with 60 per cent using AI daily or several times a week, compared to just 29 per cent of those without CDPs.

Additionally, 35 per cent of CDP users employ AI to prepare data for marketing or analytics, versus only 9 per cent of non-CDP users. Furthermore, 22 per cent of retailers with CDPs have achieved full AI adoption across multiple business units, more than double the 10 per cent of those without such platforms.

“Retailers are leveraging AI to deliver more adaptive, personalized customer experiences powered by high-quality, unified customer data,” said Tapan Patel, research director at IDC. “Retailers who integrate AI into core workflows—across supply chain, merchandising, and engagement—are setting the new standards for customer experience in an increasingly dynamic market.”

The report underlined a crucial reality: while AI adoption in retail is accelerating, true readiness lags. To capitalise on AI’s full potential, the sector must invest not just in technology, but also in unified data infrastructure, employee training, and change management.

The survey, conducted in June 2025 through Pollfish, was based on responses from 1,000 participants.

ALCHEMPro News Desk (SG)