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AI in Retail—Top Trends for 2021


Dec 11, 2020 - 7 minute read

1302 AI In Retai Top Trends For 2021 416X300
Paweł Krawczyk Chapter Leader & Senior Software Developer

He readily follows market trends and is passionate about technology—most notably, mobile and cloud solutions. Currently, he’s focused on bringing added value to the company’s commercial retail projects.

See all Paweł's posts

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Experimenting with new ideas is crucial to ongoing success and maintaining market share in the retail world. Artificial Intelligence is reinventing the retail sector’s landscape. According to Gartner, by 2021, 77% of retailers will survey plans to have AI in place. From using augmented reality to personalise offers to applying computer vision and endless aisles to reduce lost sales, businesses can harness AI in retail to enrich customer experience and operate more efficiently. In the highly competitive industry with razor-thin margins, AI maybe your edge over the competition. By utilising existing software development frameworks, you can create innovative custom applications faster than one can imagine.

Augmented Reality

Augmented reality has emerged as an innovative tool that allows brands to interact with consumers on their mobile devices. But as quality applications can become costly, retailers often question if the new tech hype can offer anything other than short-lived entertainment? Interestingly, Eurostat found that 70% of people who choose not to buy online, all agree that they prefer to explore a product in real life, which makes them feel more comfortable with their purchase decision. In times of the COVID-19 pandemic, customers are cautious, and this tends to limit the frequency of traditional brick-and-mortar store visits. Augmented reality seems perfectly suited to address this issue by providing a tool for the 3D visualisation of goods to support a vital element of the sales process—decision-making.

The ‘try before you buy’ capability with augmented reality is implemented by various companies from the beauty and fashion industry. For example, thanks to its facial recognition tech, the application allows a person to try out different shades of make-up on their face in real-time, compare and share looks, as well as complete the purchase. The share feature is especially interesting because it increases the brand’s social media presence and creates an opportunity to attract new customers—without having to spend an additional portion of the budget on marketing campaigns.

The other implementation is the virtual fitting room concept, which helps customers choose the perfect size and see how items combine with other garments. The applications either use the camera preview or permit the upload of a full-body photo to create a virtual avatar which can try on the clothing. This type of innovation not only boosts sales and adds value to the shopping experience, but, more importantly, it helps the customer make the right choice. Online apparel has a high product return rate because of a trial-and-error approach to sizing and, therefore, generates substantial costs for retailers who have to handle returns. It's common practice for customers to order multiples of items to ensure at least one item fits with the intent to return the rest. This approach is a time-consuming, costly, and inefficient process for all parties. By implementing ‘try before you buy’ augmented reality applications, the retailer can improve customer satisfaction by providing a personalised experience—thereby, also greatly reducing the number of returns.

ai trends in retail


The impact of the COVID-19 pandemic and the resulting changes in retail shopping patterns have provided an opportunity to reinvent and revolutionise the way this industry operates. The business cases are appealing, but the costs related to the development of such an application might seem more significant than the actual business benefits. Augmented reality seems to be the domain of highly specialised companies with a vast portfolio of commercial products. Thanks to Google's ARCore and Apple's ARKit framework, the bespoke software development of such mobile applications is easier than ever. These platforms provide simple yet powerful features including facial recognition and Depth API (which makes virtual objects appear as though they're part of a real-world scene). Retailers can insert augmented reality patterns without having to reinvent the wheel. Adopting such solutions enables the reduction of overall costs, offers rapid delivery of innovative applications, and ensures their quality and continuous improvement.

Computer Vision

Sounds scary? In simple words, computer vision seeks to understand and automate tasks that the human visual system can conduct. It acquires, processes, and analyses digital images and videos to understand them and to make a decision that would typically require human interaction.

Retailers can utilise computer vision to assist shop floor staff with everyday tasks such as shelf management. The traditional method of managing stock availability in brick-and-mortar stores involves performing stock counts or gap scan cycles. This includes examining aisles one by one and looking for gaps or empty shelves. And If an employee finds that a product is missing, they scan the barcode to report the issue and log it into the external stock management system. Usually, these types of manual and time-consuming tasks are performed once a day.

Computer vision automates the shelf stocking process and reports violations in real-time. This technology uses connected cameras to monitor aisles and automatically creates the task to rectify the gap when the product cannot be found. The employee is notified about the event and can immediately restock the shelf. Accurate and proactive actions replace time-consuming manual processes, ensuring shelves remain stocked, and customer expectations are satisfied. Process automation reduces the number of repetitive activities, which increases employees’ job satisfaction. It also reduces the amount of lost sales opportunities and leads to improved stock availability, which is an essential factor for a high-quality customer experience.

The system supplies data that can be analysed and utilised in other parts of the business. Real-time tracking allows checking how long the product was missing to evaluate workforce performance. The other application is to test the influence of the various shelf planograms on customer product choices. You can experiment with different layouts by testing the product placement and promoting selected items to maximise sales.

Along with these applications, you can use these types of solutions for in-store marketing and sales initiatives. One of computer vision’s most exciting capabilities includes determining age and gender based on facial recognition. Automated systems can be used to identify or check the identity of individuals in just a few seconds based on their unique facial features: the bridge of the nose, the spacing of the eyes, the contour of the lips, ears, chin, etc. This information is used to customise marketing content presented on digital advertising displays. The software identifies which footage evokes the most positive reaction and presents a personalised, discounted offer. Computer vision surfaces the right product or service assortment, without making customers search for it. Targeted product suggestions save time and create seamless experiences that make it easy for customers to engage with items and make purchases. While employing facial recognition offers many advantages within the retail environment, you should consider and be aware of the ethical and personal rights considerations in the potential adoption of this technology.

Endless Aisles

Retailers want the ability to provide their customers with a modern and compelling in-store experience. This includes personalised recommendations, simplified buying, and a faster customer service to compete with fast-growing eCommerce solutions. One of the most significant natural advantages of brick-and-mortar stores is that the products are available immediately. There is no need to wait for the delivery. Also, customers value the opportunity to see what they're buying and to try out the goods. But what happens when the product is out of stock? Is the sales opportunity completely lost? Not anymore, thanks to the innovative endless aisle concept.

Endless aisles are in-store kiosks or mobile applications which allow customers to browse and order products that are not available in the store. The user can scan the shelf edge label or tag to find out if the item is available online or in a different store. If the product is not available or discontinued, the system displays similar goods. It can also be utilised to upsell a more premium version or to cross-sell an accessory related to the missing item. This allows for inventory expansion without increasing the floor space, which contributes to significant cost savings.

Additionally, the 3D model of a product with an interactive 360-degree view can be provided to assist the customer in the decision-making process. All these features enhance customer experience by broadening choice range and providing a faster service. You can make the most of these opportunities to drive conversion, increase customer spend, and foster loyalty.

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The mobile app user can also browse additional information about a product without the need for sales assistance from store associates. Shop floor employees can also take advantage of the software to help customers with their purchasing process. Commercial teams can capture customer insights based on behavioural data from the app’s interactions in order to personalise offers further and market them via notifications. There are plenty of potential use cases, which makes the endless aisle an important innovation. The key to success is a user-friendly interface and a seamless order fulfilment process. As a result, customers won’t feel as though they’ve wasted their time by visiting the shop, while you benefit from additional sales opportunities.


There’s no doubt, that the pandemic will spur user adoption of Artificial Intelligence innovation in retail. To ensure that applications will continue to offer benefits post-pandemic, they must create meaningful improvements in the shopping experience and deliver on their original promises. The most difficult challenge in mobile application adoption is making a change in the user's buying habits—but these uncertain times are a stimulus for that change. Now is the right time. Customers are looking for new ways to engage with products and technology is finally mature enough to provide high-quality solutions at an accelerated time-to-market.

In summary:

  • Use augmented reality to provide a unique customer experience that will differ from the competition and boost your marketing efforts via social media.
  • Take advantage of the endless aisles feature to make sure your products are always available, even when there is no space for them in the store.
  • Automate stock management with computer vision to ensure your in-store operations are lean.


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Paweł Krawczyk Chapter Leader & Senior Software Developer

He readily follows market trends and is passionate about technology—most notably, mobile and cloud solutions. Currently, he’s focused on bringing added value to the company’s commercial retail projects.

See all Paweł's posts

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