Artificial intelligence emerged in 2025 as a priority topic for retail executives. For the best in the industry, AI in 2025 was more about value creation and less about technology. 

See below for 2025’s best examples of retail AI investment.  

The year began with a bevy of AI-in-retail noise: headlines that 95% of industry leaders considered AI to be a top C-suite priority, seminars aplenty in New York, investment analyses that forecast 46% annual growth for retail AI investment through 2030, and a provider ecosystem that had multiplied from several dozen to several hundred potential vendors.   

As months passed, public enthusiasm was dented by the reality of retail’s ongoing data issues (lots of it, but often unreliable and inaccessible), questions of where to start, the complexities of ecosystem selection and integration, and – with a thud – the July 2025 MIT Media Lab’s Project NANDA report on The State of AI in Business, which concluded that, despite $30-40 billion in enterprise investment in Generative AI, 95% of investing organizations were receiving no measurable P&L impact. 

Yet, behind the scenes, the value of artificial intelligence in retail was being proven – and new competitive advantages were created in multiple operational areas. 

Three critical executive takeaways from 2025: 

• Artificial intelligence is less a technology issue than a strategic one, less an assignment for the CIO (or a CAIO) than a commitment by the Board to the future of the brand.  

• Artificial intelligence cannot be defined nor limited to generative AI. The industry’s business leaders have been using an assortment of AI tools (machine learning, computer vision, voice) for decades and are now implementing generative, agentic systems and physical AI (robots) while exploring causal intelligence.  

• Generative AI for consumers is rapidly re-shaping the decision journey. It’s called Prompt or Agentic Commerce, where online search and discovery is pursued online through large language models – displacing traditional search, and inserting new players into the value chain. Early reports estimate that ChatGPT received 46-50 million US-based shopping queries during 2025’s Black Friday week.  

A curated list of 2025’s best investments: 

• Walmart’s ongoing commitment to digital transformation, marked by a $500M investment in all forms of AI -- from classic machine learning to the “Sparky” shopping bot to robotic automation and agentic AI – that establishes AI as a foundational, integrated “operating layer” for every constituency and operational area of the Walmart business.  The list of 2025 projects is long – and the value of the Walmart’s data will do nothing but multiply. 

• Amazon’s investment in fulfillment center automation, where more than 1 million industrial mobile robots are now routed through fulfillment centers by “DeepFleet,” an AI model that provides real-time traffic control – and continuously learns, to enable ever-improving storage density and path efficiency.   

• The use of artificial intelligence to detect and more precisely predict merchandising trends – as, for example, at Zara, Target, and H&M. Zara’s AI-powered social listening scans social media platforms, fashion blogs, online forums and influencer content – content of millions – to identify shifts in color, style, and fabric choices and (with world-class manufacturing and supply) get on-trend styles on-shelf within days.  Target’s “Trend Brain” is a generative-AI trend intelligence and creative platform that helps Target’s merchants read the market earlier, make better product bets, and refresh assortments more quickly. At H&M, AI systems utilize historical sales data, market trends, customer preferences, and external variables such as weather patterns and local events to generate detailed forecasts.  

• The continued maturity of generative AI-based shopper concierges and assistants. Four of note: “Ask Ralph,” the conversational AI tool of Ralph Lauren, which serves shoppers as a personal stylist, and merchants and marketers as a source of right-time data; “Hopla,” the generative AI assistant of Carrefour, which offers natural language guidance for menu planning, list creation, and even budget-constrained shopping that is specific to a preferred store’s availability; AI-based beauty advisors and product matching at Sephora, which also leverages past purchase data to refine cross-sell and upsell recommendations; and, “Rufus” of Amazon, said this year to be used by more than 250 million customers.  

• Home Depot’s “Blueprint Takeoffs” – the use of AI-powered project planning tools to provide contractors and remodeling professionals with fast and accurate materials lists and cost estimates.  

What’s next? In 2026, we’ll read about agentic artificial intelligence, prompt commerce, and the first implementations of causal intelligence in retail – where AI takes the industry beyond prediction based upon correlation to true understandings of cause and effect.