AI in retail

Enhance shopping experiences and optimize logistics with AI for retail

AI is transforming retail by personalizing shopping and automating operations, helping businesses remain competitive. Learn how Google Cloud can help optimize your retail business.

Want training? Start a free course on Vertex AI Studio.

Überblick

What are the benefits of using AI in retail?

Using AI in retail offers many advantages that can help drive business growth. For customers, it can mean more personalized shopping experiences with recommendations that truly match their tastes and needs, which can lead to increased loyalty.

For businesses, AI can help with:

  • Hyper-personalization at scale: AI helps retailers move beyond simple recommendations to guided selling, and can act as a 24/7 expert. For example, it helps a customer find the perfect laptop for a specific workload or a skincare routine based on their unique skin type. This can lead to higher conversion rates and fewer returns.
  • Predictive inventory and waste reduction: By analyzing real-time global trends and local weather patterns, AI can help cut demand forecasting errors. Retailers can move stock before a surge happens to ensure the right product is in the right aisle at the right time.
  • Post-purchase excellence: AI agents are now able to handle basic inquiries, such as tracking orders or checking return eligibility, instantly. This helps reduce call center costs and improves customer satisfaction by removing the friction of waiting for a human agent.
  • Autonomous store operations: Vision AI and agentic workflows help automate routine work. Robots and cameras can handle shelf auditing and stock gap detection. They even help with automated employee scheduling based on real-time foot traffic, which allows human staff to focus entirely on the customer.
  • Dynamic pricing: Retailers can adjust prices in real time based on competitor moves and local demand to protect margins.
  • Fraud protection: AI can help identify suspicious return patterns and payment anomalies in milliseconds to secure revenue and protect customer and business data.
  • Reduced product development cycles: Using generative AI, brands are shortening the time it takes to research and design new products from weeks to just days. This allows them to react to viral trends while they’re still relevant.


What are some of the potential challenges of AI in retail?

Using AI in retail may involve more than just software updates; it can require navigating a complex set of operational and ethical hurdles. Here are some common challenges retailers may come across:

  • Data silos and swamps: Many retailers struggle with fragmented, low-quality data that prevents AI from providing accurate, real-time insights or making effective decisions.
  • The technical debt barrier: Older POS systems and legacy infrastructure can lack the processing power and connectivity required to support modern, high-speed AI models.
  • The regulatory patchwork: Complying with evolving global laws, such as the EU AI Act, while managing the ethics of consumer privacy creates significant legal requirements.
  • Maintaining customer trust: Poorly implemented AI-only support may lead to consumer backlash. Shoppers often still prefer human interaction for complex or sensitive issues.
  • Cybersecurity and deepfakes: AI creates new risks, including sophisticated phishing, fraudulent product reviews, and deepfake media that can damage brand reputation quickly.
  • Measuring ROI: Initial costs for hardware and integration may not show immediate tangible outcomes, especially if projects don't have a clear scaling strategy.

What is the future of AI for retail?

Looking at the coming years, retail will likely transition from a reactive industry to an agentic, autonomous ecosystem. We’re moving into an era of "Agentic Commerce," where personal AI assistants can negotiate and transact directly with retailer systems, making traditional web interfaces less central than machine-readable data.

Physical stores may evolve into "phygital" hubs—fully autonomous environments optimized by real-time digital twins and sentiment-aware AI that can adjust everything from store layouts to personalized product designs on the fly. Ultimately, as AI masters the logistics of supply chains and routine transactions, the retail landscape may bifurcate. High-volume needs will be managed by invisible, predictive algorithms, while the physical storefront will be reinvented as a high-touch gallery where human empathy and "verified authenticity" become the ultimate luxury commodities.

What retail businesses are using AI?

  1. Mercari: As the largest online marketplace in Japan, Mercari makes it easier to access customer service agents using Google AI. The company expects to achieve a 500% ROI and a 20% reduction in staff workload.
  2. Target: Uses Google Cloud to power AI solutions on the Target app and Target.com, including personalized Target Circle offers.
  3. Carrefour Taiwan: Carrefour Taiwan's AI Sommelier, a conversational AI service integrated into its app, helps customers select wines based on their preferences.
  4. The Home Depot: Home Depot built Magic Apron, an AI agent that offers expert guidance 24/7, providing detailed how-to instructions and product recommendations.
  5. Unilever: Created digitized distribution trade processes using BigQuery. Using in-depth analytics, Unilever can now process 75,000 orders daily and reach millions of retailers in emerging markets.
  6. Wayfair: By automating the enrichment of its product catalog, Wayfair now updates product attributes at 5x the previous speed, resulting in substantial savings in operational costs.
  7. Dunelm: Has partnered with Google Cloud to enhance its online shopping experience with a new gen AI-driven product discovery solution to help customers find products more easily.
  8. Lush: Uses Vertex AI and Cloud Storage to power Lush Lens, an AI-powered image recognition system that identifies packaging-free products at checkout, which reduced queue times and saved water.
  9. Miinto: To enhance customer satisfaction and lower overhead, Miinto uses Vertex AI Vision to recognize and consolidate redundant product entries.
  10. Papa John’s Pizza: Using BigQuery, Vertex AI, and Gemini models to build predictive tools that can better anticipate customers orders in the app, as well as an enhanced loyalty program and more personalized marketing offers.
  11. 3 Farm Daughters: A family-owned pasta company, writes social media posts with help from Gemini in Docs.
  12. Sports Basement: Customer service team is using Gemini in Google Workspace to reduce the time spent writing emails by 30-35%.

For more examples of retailers and other businesses using AI, check out 1,000+ real-world gen AI use cases from the world's leading organizations.


Is AI in retail secure?

Like many industries, AI in retail is a high-stakes environment where technology can act as both a powerful shield and a new vulnerability.

On one hand, AI has revolutionized loss prevention. Retailers are increasingly deploying AI-driven computer vision and real-time transaction monitoring to reduce shrink, such as theft and fraud. They are also increasingly using SynthID to watermark AI-generated content, which helps customers verify that product images or reviews are authentic and not "synthetic" deepfakes created to damage a brand's reputation.

However, the integration of AI also expands the cyberattack surface. Emerging threats like prompt injection and data poisoning have forced major retailers to implement strict new AI governance policies.


Google Cloud AI tools for retail

Product NameUse CaseKey FeaturesPricing

Building always-on customer support: Rapidly build, test, and deploy personalized multimodal support agents at scale

Includes a "drag-and-drop" canvas so employees of all skill levels can create and launch support workflows

Virtual personal shoppers: Providing human-like assistance on websites and mobile apps.

Built-in ability to answer product questions, suggest outfits, and guide customers through the checkout.

Enhanced digital storefronts: Improving on-site search accuracy and browse experiences.

Uses LLMs to understand shopper intent; supports "Conversational Product Filtering" and 100+ languages.


Business operations and strategy: Analyzing sales reports, handling inventory management, automating vendor emails, and internal data synthesis.

Full integration with Google Docs/Sheets/Gmail; access to latest Gemini models; ability to build "no-code" custom agents for internal workflows.

Physical store intelligence: Searching vast amounts of CCTV or on-shelf image data to audit inventory or safety.

Text-to-video search (Example: "Find blue paint spill in Aisle 4"); PB-scale storage; real-time event triggers.

Use Case

Building always-on customer support: Rapidly build, test, and deploy personalized multimodal support agents at scale

Key Features

Includes a "drag-and-drop" canvas so employees of all skill levels can create and launch support workflows

Pricing
Use Case

Virtual personal shoppers: Providing human-like assistance on websites and mobile apps.

Key Features

Built-in ability to answer product questions, suggest outfits, and guide customers through the checkout.

Pricing
Use Case

Enhanced digital storefronts: Improving on-site search accuracy and browse experiences.

Key Features

Uses LLMs to understand shopper intent; supports "Conversational Product Filtering" and 100+ languages.


Pricing
Use Case

Business operations and strategy: Analyzing sales reports, handling inventory management, automating vendor emails, and internal data synthesis.

Key Features

Full integration with Google Docs/Sheets/Gmail; access to latest Gemini models; ability to build "no-code" custom agents for internal workflows.

Pricing
Use Case

Physical store intelligence: Searching vast amounts of CCTV or on-shelf image data to audit inventory or safety.

Key Features

Text-to-video search (Example: "Find blue paint spill in Aisle 4"); PB-scale storage; real-time event triggers.

Pricing

Funktionsweise

Artificial intelligence in retail uses smart technologies to improve many parts of retail business processes. This can include making the shopping experience better for customers, optimizing how stores and warehouses run, and helping leaders make smarter decisions. AI systems can analyze huge amounts of data much faster than people can, helping spot patterns, predicting what customers might want next, and even automating routine tasks.

Gängige Einsatzmöglichkeiten

Unifying online and in-store experiences

AI can help create a consistent customer experience across both physical stores and e-commerce channels by ensuring consistent pricing, promotions, and inventory levels.

You can use Google Distributed Cloud (GDC) to connect to your store locations. This "Edge AI" infrastructure allows you to process real-time inventory and customer interactions locally, ensuring zero latency even if the store's internet connection is unstable. This local data is then "federated" into a central BigQuery warehouse that powers the e-commerce engine.

    AI can help create a consistent customer experience across both physical stores and e-commerce channels by ensuring consistent pricing, promotions, and inventory levels.

    You can use Google Distributed Cloud (GDC) to connect to your store locations. This "Edge AI" infrastructure allows you to process real-time inventory and customer interactions locally, ensuring zero latency even if the store's internet connection is unstable. This local data is then "federated" into a central BigQuery warehouse that powers the e-commerce engine.

      Real-time inventory management

      Store managers can receive accurate, real-time inventory recommendations to boost efficiency.

      A way to implement this would be to ingest raw video streams from existing store CCTV directly into Vision Warehouse. Unlike older systems that required manual tagging, this uses natural language search over video. A manager can simply prompt the system to alert them when any shelf in the beverage aisle is more than 20% empty. The AI then continuously audits the visual shelf state against your digital inventory records. When it finds a discrepancy, the AI can automatically alert a floor associate's handheld device with a photo of the gap and directions to the replacement stock.

        Store managers can receive accurate, real-time inventory recommendations to boost efficiency.

        A way to implement this would be to ingest raw video streams from existing store CCTV directly into Vision Warehouse. Unlike older systems that required manual tagging, this uses natural language search over video. A manager can simply prompt the system to alert them when any shelf in the beverage aisle is more than 20% empty. The AI then continuously audits the visual shelf state against your digital inventory records. When it finds a discrepancy, the AI can automatically alert a floor associate's handheld device with a photo of the gap and directions to the replacement stock.

          Enhanced product discovery and recommendations

          AI can help personalize the search experience, enabling users to find unique items quickly on online platforms.

          One way to do this is to uplevel your traditional keyword search with semantic search, which you can create using Vertex AI Search. Make discovery experiences on your sites or applications more relevant and ROI-driven with personalized search results, recommendations, and insights rooted in your product catalog. Leverage natural language processing, Google's unique web signals, Knowledge Graphs, and our commerce-tuned LLMs help your search bar understand intent-based queries like "What should I wear to a rainy outdoor wedding in October?."

          Also, by enabling conversational filtering or search, the AI can dynamically ask the user questions based on their initial query to narrow down items. For example, the AI might ask if you're looking for casual or formal wear, or a specific size. This can drastically reduce the time it takes to find a specific or niche product.

            AI can help personalize the search experience, enabling users to find unique items quickly on online platforms.

            One way to do this is to uplevel your traditional keyword search with semantic search, which you can create using Vertex AI Search. Make discovery experiences on your sites or applications more relevant and ROI-driven with personalized search results, recommendations, and insights rooted in your product catalog. Leverage natural language processing, Google's unique web signals, Knowledge Graphs, and our commerce-tuned LLMs help your search bar understand intent-based queries like "What should I wear to a rainy outdoor wedding in October?."

            Also, by enabling conversational filtering or search, the AI can dynamically ask the user questions based on their initial query to narrow down items. For example, the AI might ask if you're looking for casual or formal wear, or a specific size. This can drastically reduce the time it takes to find a specific or niche product.

              Modernizing in-store operations

              Streamlining legacy, paper-based processes with AI-powered mobile devices can improve store associate productivity and customer service.

              Using Gemini Enterprise you could build a Store Associate Agent accessible on mobile devices. This agent is grounded in your company’s internal Standard Operating Procedures (SOPs) and real-time operational data. Associates can use voice-to-text to ask complex questions like, "How do I process a return for a damaged item without a receipt?" or "Summarize the morning manager's notes for the footwear department."

                Streamlining legacy, paper-based processes with AI-powered mobile devices can improve store associate productivity and customer service.

                Using Gemini Enterprise you could build a Store Associate Agent accessible on mobile devices. This agent is grounded in your company’s internal Standard Operating Procedures (SOPs) and real-time operational data. Associates can use voice-to-text to ask complex questions like, "How do I process a return for a damaged item without a receipt?" or "Summarize the morning manager's notes for the footwear department."

                  AI-powered shopping assistants

                  Virtual assistants can visually guide customers through complex processes and provide personalized support, enhancing customer engagement.

                  Manage the entire journey from discovery to checkout and beyond with a Shopping agent. Leveraging the Gemini family of models, the agent acts as a digital concierge, grounded in your full product catalog and customer loyalty data. More than just a chatbot, it acts like an expert who understands shoppers' personalized needs using complex reasoning and multimodal inputs to take consented actions to streamline the purchase.

                    Virtual assistants can visually guide customers through complex processes and provide personalized support, enhancing customer engagement.

                    Manage the entire journey from discovery to checkout and beyond with a Shopping agent. Leveraging the Gemini family of models, the agent acts as a digital concierge, grounded in your full product catalog and customer loyalty data. More than just a chatbot, it acts like an expert who understands shoppers' personalized needs using complex reasoning and multimodal inputs to take consented actions to streamline the purchase.

                      Product description generation

                      AI can automatically generate unique, high-quality, and SEO-friendly product descriptions at scale.

                      For a high-volume catalog, you could set up an automated pipeline using Gemini 3 Flash. You feed the model raw inputs: technical specs, high-resolution images, and your brand's voice guidelines. To ensure quality at scale, implement a multi-agent review workflow. One Gemini agent drafts the description, a second reviews it for SEO, and a third agent checks for accuracy against the spec sheet. This allows a retailer to generate thousands of descriptions in hours rather than months.

                        AI can automatically generate unique, high-quality, and SEO-friendly product descriptions at scale.

                        For a high-volume catalog, you could set up an automated pipeline using Gemini 3 Flash. You feed the model raw inputs: technical specs, high-resolution images, and your brand's voice guidelines. To ensure quality at scale, implement a multi-agent review workflow. One Gemini agent drafts the description, a second reviews it for SEO, and a third agent checks for accuracy against the spec sheet. This allows a retailer to generate thousands of descriptions in hours rather than months.

                          Trend identification and customer interaction improvement

                          Quickly identify trends from customer feedback using AI to improve interactions.

                          Implementation involves funneling all unstructured customer feedback into BigQuery. You then use Gemini Enterprise’s Deep Research capability to perform theme clustering across millions of interactions. The AI identifies emerging trends before they show up in sales data. For example, it might notice a 15% uptick in customers asking about biodegradable packaging in support chats.

                            Quickly identify trends from customer feedback using AI to improve interactions.

                            Implementation involves funneling all unstructured customer feedback into BigQuery. You then use Gemini Enterprise’s Deep Research capability to perform theme clustering across millions of interactions. The AI identifies emerging trends before they show up in sales data. For example, it might notice a 15% uptick in customers asking about biodegradable packaging in support chats.

                              Merging and deduplicating product listings

                              AI helps manage product catalogs from multiple vendors by identifying and merging duplicate listings.

                              To manage a multi-vendor catalog, you can use Vertex AI to perform fuzzy matching and entity resolution. The AI uses multimodal understanding to "see" that the images and specs are identical despite the different text.

                              The practical approach is to create a "golden record" for every SKU, where the AI analyzes all incoming data streams, identifies duplicates, and selects the highest-quality image and most accurate description to represent the product. This ensures that your storefront remains clean and that inventory levels are accurately aggregated across all suppliers.

                                AI helps manage product catalogs from multiple vendors by identifying and merging duplicate listings.

                                To manage a multi-vendor catalog, you can use Vertex AI to perform fuzzy matching and entity resolution. The AI uses multimodal understanding to "see" that the images and specs are identical despite the different text.

                                The practical approach is to create a "golden record" for every SKU, where the AI analyzes all incoming data streams, identifies duplicates, and selects the highest-quality image and most accurate description to represent the product. This ensures that your storefront remains clean and that inventory levels are accurately aggregated across all suppliers.

                                  Automating sales quotes for configurable products

                                  Generating accurate quotes quickly using AI and aerial imagery.

                                  For retailers selling outdoor or home-improvement products (like solar panels, roofing, or sheds), you could integrate Google Earth Engine's high-resolution aerial imagery. When a customer enters their address, the AI uses computer vision to measure the roof's area, pitch, and shading from nearby trees.

                                  A Vertex AI agent could then take these measurements and cross-references them with your current labor rates and material costs. Within seconds, it generates a precise, 3D-visualized sales quote. This removes the need for an initial site visit, allowing sales teams to focus only on high-intent leads that have already received and approved a preliminary "AI Quote."

                                    For more in-depth examples of AI applications and the technical details on how to implement them, check out 101 real-world gen AI use cases with technical blueprints.


                                    Generating accurate quotes quickly using AI and aerial imagery.

                                    For retailers selling outdoor or home-improvement products (like solar panels, roofing, or sheds), you could integrate Google Earth Engine's high-resolution aerial imagery. When a customer enters their address, the AI uses computer vision to measure the roof's area, pitch, and shading from nearby trees.

                                    A Vertex AI agent could then take these measurements and cross-references them with your current labor rates and material costs. Within seconds, it generates a precise, 3D-visualized sales quote. This removes the need for an initial site visit, allowing sales teams to focus only on high-intent leads that have already received and approved a preliminary "AI Quote."

                                      For more in-depth examples of AI applications and the technical details on how to implement them, check out 101 real-world gen AI use cases with technical blueprints.


                                      Ready to transform your retail experience?

                                      Train and deploy machine learning models and AI applications

                                      Learn about Free Tier monthly usage limits

                                      Take free courses on artificial intelligence

                                      Google Cloud