2%-5%
sales lift
1%-3%
margin lift
2%-3%
cost of goods sold savings

About Merch AI by BCG X

For retailers, having enough data on merchandising options isn’t the problem; it’s gleaning the critical insights hiding inside internal and external data—insights needed to optimize decisions about products, suppliers, shelf space, and stores. An integral element of our larger Retail AI offering, Merch AI’s suite of nine automated merchant applications helps retailers uncover insights that would otherwise remain hidden, achieving deeper customer satisfaction, greater cost advantage, and, ultimately, increased topline growth and margin.

Merch AI brings more than just advanced algorithms and applications to the table. Our team of over 50 BCG X engineers partners with BCG consultants to offer deep retail expertise, a customized and scalable approach, and best-in-class implementation and change management. Retailers can select the tailored solutions most relevant to their specific starting point and business needs to realize value quickly—or implement the full suite of merchant analytics applications as part of a broader AI transformation initiative.

Merch AI by BCG X helps retailers uncover insights that would otherwise remain hidden—achieving deeper customer satisfaction, greater cost advantage, and increased topline growth and margin.

Harnessing Data and AI Solutions to Extract Maximum Value

Our AI solutions for merchants rapidly generate actionable insights to inform supplier negotiations, assortment decisions, and more. We quickly pull together disparate data sources into a “single source of truth” to inform insightful visualizations and predictive recommendations via advanced AI and GenAI models. We ensure sustained impact and long-term success through our enablement-focused approach; we recognize that only 10% of the value from data analytics comes from advanced algorithms, 20% from the data and tech backbone, and 70% from change management, new processes, and people upskilling.
Inside Merch AI
Using AI to Unlock Merchant Process Automation
Merch AI’s suite of nine merchant analytics applications goes deep into merchandising data, providing insights that retailers can act on to turbocharge category performance.
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Enhancing Merchant Process Automation with AI

Built on a flexible cloud platform, Merch AI’s merchant analytics applications deeper insights at a larger scale in less time. The applications are highly customizable, with our engineering and Merch AI experts ensuring seamless integration into existing environments. Retailers can select the relevant use cases and leverage tailor-made algorithms and workflows to automate key analyses, reduce time spent on manual tasks, and enhance merchant skills and capabilities to drive sustained impact and long-term success.

What will customers want, where will they want it, and how much will they be prepared to pay? These are questions retailers grapple with every day. Now, Merch AI by BCG X enables merchants to develop data-led strategies around their product selection and placement decisions. In this video, BCG X’s Nicholas Goad explains how his early experiences in his grandparents’ store led to a passion for helping retailers with inventory and pricing.

Our Clients’ Success with Merch AI

$100M+
in bottom-line impact
Deeper Insight into Vendor Cost and Profitability
With limited visibility into true dead net profitability (DNP), a major US grocery retailer could not negotiate vendor costs and funding effectively. We deployed a custom software that calculated DNP, modeled optimal product cost based on commodities, and automated negotiation analytics. Improved data transparency and standardized processes led to more than $100 million in annual impact on the organization’s bottom line.
4%
increase in overall sales
Customized Store Merchandising for Targeted Growth
A North American retailer wanted to customize uniform store merchandising to attract new customers and drive growth. We collaborated with the company to identify key data required to localize store layouts, design, product assortment, and space allocation. Our Merch AI experts helped pilot changes in 25 stores before scaling them company-wide. The updates led to a 25% consumables growth and up to 4% increase in overall sales.
$2.8B
in-store revenue increase identified
Smart Store Network Optimization
To adapt to changing consumer preferences, a major US apparel, beauty, and home retailer needed to rethink its physical footprint. Our Merch AI team helped the retailer customize category performance tools and create models to predict store metrics, identifying underperforming locations and sites for new, smaller-format stores. Opportunities were identified to increase in-store revenue by $2.8 billion and e-commerce revenues by $165 million.
Experts

Meet the Merch AI Team

Dedicated merchant process automation experts provide fully customizable tools paired with new ways of working. Close collaboration eliminates key knowledge gaps, ensuring our merchant analytics applications exceed expectations and provide sustained excellence.

Managing Director & Senior Partner

Nick Goad

Managing Director & Senior Partner
Washington, DC

Partner & Vice President

Robert Stern

Partner & Associate Director
Philadelphia

Managing Director & Senior Partner

Jonathan Fahey

Managing Director & Senior Partner
New Jersey

Managing Director & Partner

Jacqueline Martinez

Managing Director & Partner
Washington, DC

Managing Director & Partner

Jill Wang

Managing Director & Partner
New Jersey

Managing Director & Partner

Erin White

Managing Director & Partner
New Jersey

Managing Director & Partner

James Brindley

Managing Director & Partner
Prague

Explore Our Latest Thinking on Automated Merchant Analytics

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Industry
流通業界
Capability
AI