Retail Analytics and Artificial Intelligence

To help our retail industry clients better leverage the power of their data—and better integrate with retail ecosystems—BCG combines advanced analytics and AI with data to solve problems all along the value chain, from ranging and pricing to personalization and logistics.

Omnichannel Retail Strategy

We take a customer-driven approach to omnichannel strategy design, drawing on our proprietary consumer research techniques and world-class personalization data-science capabilities to support data-driven sales and omnichannel growth strategies. Our approach to omnichannel retail offers a holistic view that allows clients to attribute, track, and measure the value of investments across all channels.

Retail Operations

The need for flexibility extends to retailers’ supply chain partners and other drivers of a multiformat retail experience. With the desired customer experience and economics acting as the North Star, we prioritize the right end-to-end operations use cases, then rapidly mini-test and iterate specific solutions (physical and digital) to improve demand forecasting, product availability, service and labor planning, inventory management, waste reduction, and more.

Cost Optimization

Addressing each element of cost independently, we reset the base on a collection of cost drivers to align operating costs with the retailer’s customer value proposition, providing significant value for key stakeholders. In a shifting retail environment, rigorous tradeoffs among cost, service, and experience are essential to this process.

Digital Retail Marketing and Personalization

To help retailers expand their audience and deepen connections with existing customers, we leverage our experience in developing digital marketing capabilities, using AI and other retail technology to drive personalization—the frontier where customers, now more than ever, are won or lost.

Social Impact

Embedding sustainable practices and active social responsibility into retail operations has moved from a side activity to a top priority. We partner with global retailers to ensure that contributions to social and environmental goals—for example, inclusive hiring practices and reduced food waste and plastic packaging—drive business value.

Our Client Work in the Retail Industry

Working with a leading EU retailer, BCG created a new pricing and promotions strategy and applied new range-performance-analysis tools on approximately 25,000 SKUs, optimizing all food categories. Our joint work delivered promotional results that were 33% above target in the first year. It also reduced the range by around 20% while making it more relevant for customers. In addition, there was a 6% increase in like-for-like volume—driven by the investment of liberated funds into pricing for top lines—along with a significant improvement in value perception.

BCG delivered an AI transformation at a global fashion retailer, in close partnership with the client’s internal team. Using our technology partners, including BCG X, the team leveraged AI to improve forecasting and pricing for more than 10,000 products, optimize inventory across more than 3,000 stores, and generate over 500,000 automated personalized emails. Completing a small pilot in four weeks, the team quickly scaled it, achieving a double-digit profit uplift. The project scaled to more than 70% of the global business in less than one year, and the industrialized model was complete in 18 months.

A declining North American multiformat grocery retailer engaged BCG to create a transformation management office to ensure a successful turnaround. This hub drove a major reorganization, launched cost-out programs, and expanded e-commerce to drive growth. Early success showed gross margin increases and adjusted EBITDA up around 1%, with a rebound in share price to pre-decline levels. Now on track to exceed $500 million in savings, leadership is looking to advanced analytics and AI to further growth.

A retailer in Asia-Pacific with ambitious environmental targets partnered with BCG to create a business incubator to develop and commercialize projects. Together, we defined the incubator’s role, operating model, and governance, then prioritized and designed four scalable initiatives in upstream food waste, plastics action, sustainable agriculture, and waste-as-a-resource. Deliverables included a detailed roadmap and, with the resource budget needed to meet targets of 30% growth, 4X reduction in net GHG emissions and 2X diverted food waste.

BCG at CES 2024

BCG’s delegation of experts will be at CES in Las Vegas from January 9–12, 2024, to engage on breakthrough technologies and innovations. Learn more about our programming and arrange a meeting with the team.

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Explore Our Retail Industry Insights

The So What from BCG: How Can My Shopping Save The Planet?

Sustainability is as much about mindset, intention, and focus as technology, explains Shalini Unnikrishnan, a leader on social impact at BCG.

The Future of Retail—Omnichannel

Giving the customer infinite pathways, omnichannel is the new frontier in shopping. This first video in BCG’s series on the future of retail takes us to China to learn how customers and retailers both benefit.