Generative AI: The Next Big Thing In Grocery Retail

Grocers are adapting generative AI more quickly than expected

Generative AI is used more frequently in the grocery industry as a customer assistant

Grocers need to address consumers about the use of generative AI before completely incorporating it into their business

With the emergence of technology, the world has revolutionized the world. Many companies are trying to incorporate AI into their daily routine. Generative AI has rapidly become a significant focus for grocers as they imagine it will drastically change their business. This came to notice by hackers after witnessing the market, and the technology gained widespread attention.

In a Survey conducted by Deloitte, hardly 1% of top executives from large U.S. grocery stores observe it will take years to properly incorporate generative AI, indicating that by employing generative AI, the stores are moving more quickly than expected. About 84% of those surveyed are familiar with generative AI systems’ capabilities and how efficient the system is. 

Hence, it is essential to remember some things about e-commerce and retailers about the nature of technology progress if that sounds like a case of AI exuberance. Recall that its progress trajectory was quite gradual after e-commerce first appeared in the late 1990s. Customers had to get used to an entirely new way of communicating with retailers, gain trust in online transactions, and deal with poor internet connections while navigating clunky websites that provided little product information—establishing new distribution capabilities. Not only this but setting up order fulfillment procedures to meet consumers’ expectations challenges merchants. 

According to the survey, conducted in June, data gathered responses from 100 senior top-notch executives in U.S grocery stores with over 10,000 employees. The executives limelighted several generative AI applications in the supermarket sector. The majority of the answers show a ratio of 31% who chose this option and said they use it as a “customer assistant.” This involves answering customer queries, helping in meal planning, suggesting products, and informing clients of sales, among other things. Executives also noted the importance of generative AI in grocery stores and its potential to change the dynamics. Nearly 22% believed that it has the potential to change ‘managing supply chain logistics significantly’ followed by inventory management at 19% and “assisting in the selection or creation of new private label products” at 8%”. 

Despite the potential benefits, there are specific challenges to using generative AI for customer service tasks, mainly due to collecting personally sensitive client data. It has been noticed that only 22% of respondents to a consumer survey in Deloitte’s study admit that their primary grocery store would responsibly use the technology and that there is a need when talking with customers.

In addition, more than half, nearly 53% of consumers, said they would prefer not to receive communications from their grocery stores that were generated by artificial intelligence. Deloitte suggested that retailers cautiously integrate generative AI, first to increase current digital services and highlight the benefits of technologies like apps and smart speakers without mentioning generative AI.

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