As complex forces reshape the retail sector, the role of merchandising—and merchants –will change significantly.
A Revolutionary Suite of Retail AI Solutions
Using holistic, tailored retail intelligence software, our Retail AI by BCG X technology unlocks critical advantages across the six vital components of the value chain. Establish competitive advantage with Retail AI by ensuring the availability of goods and services, examining customer data, and predicting future behavior.
5%–7%
uplift in sales
2pp–5pp
increase in operating profit margin
≥50%
boost in EBITDA
10%
gain in functional productivity
About Retail AI by BCG X
Artificial intelligence will be at the core of every future retail transformation. Retailers must modernize their commercial, operational, and supply chain functions to build for that future. To accelerate this journey, BCG X developed Retail AI, a suite of proprietary tools that leverages advanced analytics and technology for retail sustainability across the value chain. Retail AI is built into your existing environment—with your data and your people—to help develop unique, highly actionable solutions that are customized to your business.
Retail AI’s six interconnected teams partner with clients to develop an overarching AI in retail strategy, define a multiyear transformation roadmap, and establish an advanced business unit to drive progress. With our Retail AI technology comes a complete transformation, enabling stronger forecasting, the build of customer-driven assortments, and omnichannel differentiation for price positioning, distribution plans, hyper-personalization strategies—as well as improving sustainability and carbon reduction across the value chain.
WHY RETAIL AI
Enhancing Core Strategy with AI in Retail
Combining the power of traditional AI with generative AI, our Retail AI solutions include six teams working together to boost effectiveness, efficiency, and innovation.
Building Retail AI Solutions Across the Value Chain
Retailers often cite user adoption and change management as the biggest barriers to AI. We take a business-first, algorithm-backed approach, redesigning processes and aligning structure, roles, and skills to drive lasting, scalable change.
Retail AI uses BCG’s deep retail strategy experience and unites it with BCG X’s Retail AI technology for up-to-the-minute business solutions, using a comprehensive AI execution model built on BCG’s 10/20/70 rule: 10% dedicated to creating a portfolio of high-impact use cases, ignited by an initial strategy that delivers value fast; 20% to building an integrated data and technology system; and 70% to transforming people and operating-model capabilities.
The solutions we develop are targeted to provide differential value, seamlessly integrating into your tech and data environment without unnecessary spending or replatforming. Retail AI accelerates the scaling of these tools, demonstrated by six synergistic domains unlocking unprecedented value.
Pricing and Value
With an evolving retail landscape and unpredictable economic environment, pricing is a key value driver. Leveraging customized algorithms, strategic frameworks, and an innovative approach, Pricing & Value AI by BCG X helps achieve optimal pricing, promotion, and markdowns, all while orchestrating investments and improving customer value perception.
Category Management
Merch AI by BCG X acts as a hub to build and launch assortment localization capabilities, optimize real estate footprint, and more. From generating insights to recommending cost decreases, our Retail AI software brings a unified, automated approach to extract maximum value.
Precision Marketing and Personalization
Tailored content is only the beginning. Retail AI builds, engages, and maintains a loyal customer base. Using tools such as Fabriq Personalization AI by BCG X, our retail intelligence software extracts value through agile responsiveness and a unified customer experience.
End-to-End Operations and Supply Chain
From service operations digitization to supply chain management, Retail AI optimizes the retail value chain while improving team and customer experiences. Our Retail AI solutions unlock full transparency, identifying risks and critical tradeoff decisions.
Physical and Digital Channels
Expand your customer base and build marketplaces across all channels. Retail AI enables you to identify new customer occasions, leveraging a network of partnerships to lower costs. Our Retail AI technology offers cutting-edge tools, with our team of experts helping the best marketplaces in the world become even better.
Cost Optimization
Retail AI embeds AI and GenAI capabilities, advanced optimization, and automation into proven levers to accelerate cost transformation. Always-on diagnostics and prescriptive analytics enable better decisions across the value chain, addressing GNFR spend, operational costs, G&A and more for rapid impact.
Data and Tech
Unlocking AI’s value in retail requires the right technology and high-quality, accessible data. We assess your data and analytics maturity to identify gaps, validate readiness, and ensure the foundation is in place to support scalable, impactful AI use cases across your business.
Our Clients’ Success with Retail AI
$150 million
in margin improvement
Grocer in Europe
A leading European grocer used Retail AI by BCG X to drive its future loyalty, promotion, and marketing transformation. Retail AI helped reconfigure the client’s mass and personalization campaigns by building a state-of-the-art analytics system, optimizing promotion effectiveness and delivering 140 bps in margin improvement, equivalent to $150 million.
6%–12%
sales increase
Global Tire Manufacturer
An international tire company faced a complex assortment and geographical diversity problem, needing to stock the right tire, in the right store, at the right time. Using Retail AI by BCG X, BCG helped the company’s retailers shift to a data-driven selling model, resulting in significant value creation across several dimensions while increasing sales by up to 12%.
EXPERTS
Meet Our Retail AI Technology Team
Our team of experts delivers custom-made solutions for clients across the retail industry. Here are some of the team members creating Retail AI solutions and crafting modern business technology for retail sustainability.
Explore Our Insights on Artificial Intelligence in Retail
B2Cプライシング
Article
2024年11月15日
BCG’s survey research found that spending habits vary significantly depending on the category and demographic. Success for retailers will hinge on precision-driven, data-backed strategies.
B2Cプライシング
Article
2024年4月16日
Retailers are increasingly using AI-powered solutions and dynamic pricing models to outperform rivals that rely on traditional tools and approaches.
パーソナライゼーション
Interview
2023年8月10日
BCG's Silvio Palumbo discusses AI's role in reshaping the marketing function, including how platforms like Fabriq Personalization AI can translate complex data into powerful customer insights.
流通業界
Article
2023年4月25日
Artificial intelligence can provide optimized solutions to three key retailer concerns: rising cost of goods, declining consumer spending, and supply chain volatility.
プライシング・レベニューマネジメント
Article
2023年8月30日
Overwhelming consumers with elaborate promotions, discounts, coupons, and loyalty rewards can weaken consumer loyalty, tarnish brand reputation, and suppress new revenue opportunities. Instead, retailers should adopt a streamlined, customer-centric approach.
流通業界
Slideshow
2023年3月9日
Understanding every warehouse archetype, developing critical use cases, and improving existing ROI before the work begins are key to warehouse automation success.
