Artificial Intelligence (AI) in Retail Market
Report ID: SQMIG45D2166
Report ID: SQMIG45D2166
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Report ID:
SQMIG45D2166 |
Region:
Global |
Published Date: August, 2025
Pages:
193
|Tables:
122
|Figures:
70
Global Artificial Intelligence (AI) in Retail Market size was valued at USD 11.1 Billion in 2024 and is poised to grow from USD 13.26 Billion in 2025 to USD 55.16 Billion by 2033, growing at a CAGR of 19.5% during the forecast period (2026–2033).
The need for surveillance and monitoring in physical stores, the rise in internet users and smart devices, and government digitization initiatives are some of the factors driving the global artificial intelligence (AI) in retail market growth.
By bridging the gap between operational execution and customer insights, artificial intelligence in retail is revolutionizing decision-making. To make quicker and more precise decisions about product management and sales tactics, retailers are utilizing AI for real-time demand forecasting, personalized marketing, dynamic pricing, and inventory optimization.
Why are Big Data and AI Critical to Modern Retail Success?
The global artificial intelligence (AI) in retail market outlook is shaped by how companies have operated for decades. AI and big data and analytics have the potential to reinvigorate everything from how firms and businesses operate to customer service. It is core to digital business. In retail, big data and artificial intelligence are both ubiquitous and integral by various means, including the expansion of IoT, machine learning services, increasing apps and smart devices, and technological advances.
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The global artificial intelligence (AI) in retail market is segmented into component, technology, sales channel, application, and region. By component, the market is bifurcated into solution and service. Depending on technology, it is divided into machine learning, natural language processing, chatbots, image & video analytics, and swarm intelligence. According to sales channel, the market is classified into omnichannel, brick & mortar, and pure-play online retailers. As per the application, it is categorized into customer relationship management (CRM), supply chain & logistics, inventory management, product optimization, in-store navigation, payment & pricing analytics, and virtual assistant. Regionally, it is analyzed across North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.
What Makes AI Solutions So Dominant in the Retail Industry?
As per the 2024 artificial intelligence (AI) in retail market analysis, the solution segment led the market with a revenue share of more than 62%. It is asserted that the increasing challenges of managing several retail operations are facilitated by innovative and new automated technologies in the retail sector. Retailers benefit from AI-powered solutions for supply chain management, logistics, warehouse management, and improving the customer experience. With the advent of products like IBM Watson, Salesforce Einstein, Google Machine Learning AI Platform, and Content DNA Platform, the artificial intelligence in retail market share has grown.
The service segment is expected to witness rapid growth during the forecast period. Artificial intelligence in retail is expected to grow significantly based on the high demand for managed services to drive accuracy, efficiency and productivity for optimal business operations. Increased demand for services is occurring because of the rapid adoption of AI solutions, which build intelligent capabilities, enhance customer experience, strengthen revenue growth potential, create fast innovation, and reduce human error.
How is AI-Powered CRM Transforming Customer Retention in Retail?
As per the 2024 artificial intelligence (AI) in retail market forecast, the customer relationship management (CRM) segment is the largest in the market. The CRM category will grow in popularity because of the overwhelming desire to improve customer service and retention. AI-supported search engines, chatbots, virtual assistance, and other technologies enable retail vendors to build lasting relationships and foster customer loyalty. CRM software can also help retail organizations with social media integration, data collection, and communication efficiency.
The virtual assistant segment is expected to expand at the fastest CAGR between 2025 and 2032 as a result of the extensive use of smartphones and other cutting-edge tools. The retail sector has investigated virtual assistant technologies to optimize the supply chain, including inventory ordering, bookkeeping, and invoicing. Thus, driving the segment growth.
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Is North America Setting the Global Standard for AI in Customer Experience?
As per the artificial intelligence (AI) in retail market regional analysis, North America leads the AI retail adoption because of its early tech adoption and sophisticated digital infrastructure. Amazon used computer vision and edge AI to open checkout-free stores in Chicago in March 2025. Due to the need for labor efficiency and personalization in the face of growing operating costs, retailers in the US and Canada are investing in predictive analytics and customer experience solutions.
Artificial Intelligence (AI) in Retail Market in the US
The US currently leads the artificial intelligence (AI) in retail industry due to large investments in AI-driven e-commerce, CRM, and logistics. Walmart installed AI-powered shelf scanners in 1,500 locations in April 2024 to enable real-time inventory management. With AI spending in the retail sector expected to reach USD 9.2 billion by the end of 2025, retailers are using machine learning to enhance supply chain operations and personalize marketing.
Artificial Intelligence (AI) in Retail Market in Canada
The Canada artificial intelligence (AI) in retail industry is expanding on the momentum of smart store initiatives and programs promoting digital transformation. Loblaws used voice assistants and behavioral data to deliver AI-based customer experience products in July 2024. Canadian retail AI research will continue to grow with programs like the AI Supercluster Program from the government, and with rapid growth expected in the areas of omnichannel customization, loyalty programs, and demand forecasting.
What Impact are EU Regulations Having on Ethical AI in Retail?
AI is the future of retail in Europe, and it is being used through automation, multichannel strategies, and personalized marketing. In May 2025, Carrefour implemented AI-based supply chain analytics, and reduced stockouts by 18% across France and Spain. The push for transparent and privacy-preserving AI tools is stemming from GDPR-compliance. Retailers in the UK, France and Germany are focusing on using real-time data to drive customer satisfaction and operational efficiency.
Artificial Intelligence (AI) in Retail Market in UK
The UK is setting the standard for the retail sector's adoption of AI with its state-of-the-art e-commerce and technologically sophisticated supermarkets. Tesco witnessed an increase in profit margins and a reduction in food waste when it implemented an AI-based dynamic pricing system in February 2025 in over 400 stores. The combination of the embedded fintech-retail space in the UK and a focus on sustainable shopping is prompting the need for predictive and automated thinking in physical and online retail workflows.
Artificial Intelligence (AI) in Retail Market in France
Smart customer relationship management (CRM) and store automation in France had been emerging and accelerated the growth of the AI in retail sector in the country. Monoprix implemented conversational AI across all its customer support channels in June 2024, with a reported 35% improvement in response times. Supported by France 2030 and Euro 1.5 billion for AI innovation, French retail chains are now planning both data driven personalized engagement and AI led customer engagement through both online and instore channels.
Artificial Intelligence (AI) in Retail Market in Germany
Germany's strong focus on automation and industrial AI, in addition to a growing increase in AI, is linked with the growth of the AI in retail in the country. In October 2024, Aldi Nord launched AI-based inventory forecasting and reduced food waste in 700 locations by 25%. Retail leaders have quickly embraced and implemented AI as part of their digital strategy for supply chain optimization, warehouse automation, and personalized or customized products as part of Germany's Digital Strategy 2025.
Is Asia-Pacific Outpacing the West in AI-Powered Retail Innovation?
AI in retail is expanding rapidly in Asia-Pacific due to increased e-commerce, mobile usage, and urbanization. Regional companies like Rakuten, JD.com, and Reliance Retail debuted AI-powered personalization features in 2024. AI is being quickly incorporated into payment, inventory, and customer engagement systems due to the region's investments in smart retail infrastructure and government-backed AI initiatives, particularly in China and India.
Artificial Intelligence (AI) in Retail Market in China
With its implementation of self-driving stores and facial recognition technology, China is leading the world in applying AI to retail. In August 2024, Alibaba rolled out a new AI-powered customer journey initiative that increased upselling rates and customer loyalty at many Freshippo locations. The use of AI in retail is also further encouraged through complementary local chipset manufacturing as well as government programs like the New Infrastructure Plan, which supports physical and online use.
Artificial Intelligence (AI) in Retail Market in India
The rapid adoption of UPI, the expansion of digital commerce, and a mobile-first consumer base can propel AI in retail in India. For example, in January 2025 Reliance Retail adopted AI chatbots to help JioMart provide customer service in multiple languages while also helping to manage dynamic pricing. Investments in AI for voice commerce, hyperlocal inventory management and personalized marketing are also being spun up by the Indian government with its Digital India program and through adoption of cloud computing in Tier 1 and Tier 2 cities.
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Artificial Intelligence (AI) in Retail Market Drivers
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Omnichannel Retailing's Development
Artificial Intelligence (AI) in Retail Market Restraints
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Concerns about Data Privacy and Ethics
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IT companies and retail executives who use AI for automation, personalization, and customer support control the AI in the retail market. Alibaba incorporates AI into its supply chain and marketing, while Amazon uses its own AI for recommendation engines and logistics. AI retail platforms are offered by Google and Microsoft through cloud services. Key tactics to improve data capabilities and operational agility include strategic alliances, acquisitions, and in-house AI technologies.
Top Player’s Company Profile
Recent Developments in Artificial Intelligence (AI) in Retail Market
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyses the Data collected by means of Primary Exploratory Research backed by robust Secondary Desk research.
As per SkyQuest analysis, the rapid evolution of artificial intelligence (AI) in retail market is fueled by growing pressures for more tailored experiences and efficiencies in omnichannel retail settings. Retailers across the physical and digital spectrum are reporting vast uses of AI across customer engagement, dynamic pricing, visual search, and inventory optimization respectively. Adopting innovation, while benefiting from expected cost savings, still faces prohibitive hurdles including the engineering of high costs for implementation and regulatory obstacles. Nonetheless, AI adaptation is thriving on the back of new innovations and investments in AI-enabled automation, predictive analytics and autonomous retail in the current digital economy that needs change in order for retail to survive in a transformative market where AI will help retailers maintain competitive differentials, quickly achieve loyalty and sustainable growth in a constant flux.
| Report Metric | Details |
|---|---|
| Market size value in Retail | USD 11.1 Billion |
| Market size value in 2033 | USD 55.16 Billion |
| Growth Rate | 19.5% |
| Base year | 2024 |
| Forecast period | 2026-2033 |
| Forecast Unit (Value) | USD Billion |
| Segments covered |
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| Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
| Companies covered |
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| Customization scope | Free report customization with purchase. Customization includes:-
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Table Of Content
Executive Summary
Market overview
Parent Market Analysis
Market overview
Market size
KEY MARKET INSIGHTS
COVID IMPACT
MARKET DYNAMICS & OUTLOOK
Market Size by Region
KEY COMPANY PROFILES
Methodology
For the Artificial Intelligence (AI) in Retail Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Artificial Intelligence (AI) in Retail Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
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