Transformational Opportunity with AI in Indian Retail – COVID and beyond
The retail industry in India has emerged as one of the most fast-paced and dynamic sectors, due to several new entrants. As one of the top five retail markets in the world, expected to reach USD 1.4 trillion by 2024, India as a retail market is unique in its own ways, heavily dominated by the unorganized retail sector when compared to organized retail and e-commerce, leading to distinctive challenges. The sector however foresees rapid digitization across the value chain, which will lead to 3X growth in organized retail and e-Commerce by 2024, increasing the share in the near future, generating massive amount of customer and purchase data.
The COVID-19 pandemic brings unprecedented times for the world, affecting the economy, with slowdown expected in most sectors, including the flourishing retail sector. In the short-midterm, COVID-19 further exacerbates the existing challenges faced by Indian retailers. The pandemic has resulted into broken value chains, shifting customer segments and purchase patterns leading to a disconnected demand and supply. It has forced customers to rethink their purchase requirements and a shift to contactless mode of deliveries, which is bound to become the new normal going forward.
The need for rapid digitization of traditional retailers coupled with shifting customer segments and purchase preferences in a post-COVID environment will accelerate the need for innovation in the AI space. AI will become a necessity for retailers to understand dynamic demand signals, to realign supply chains, to redefine the need of essential workforces and to redefine their strategy to adapt to the new normal.
To address the growing need for AI adoption by enterprises in the retail sector, NASSCOM Research and Center of Excellence – Data Science & Artificial Intelligence (CoE, DS&AI) along with E&Y launched their enterprise playbook on Indian Retail: AI Imperative to data-led disruptive growth in the second edition of AI Parley on 10th June, 2020. The report will help retailers identify the opportunities that AI will present, particularly in a COVID and post-COVID world. The report addresses the following key quest
- Where should retail enterprises start their AI journey?
- What are the provider and retail enterprise side dynamics in retail AI ecosystem?
- How can retail enterprises move up the AI value curve?
Key findings of the report highlight that customer experience, operations and distribution & logistics are the top priorities for AI implementation in retail. AI-driven chat bots, counterfeit detection and dynamic pricing tools are some quick win use cases with high business impact and ease of implementation that retailers can implement while starting their AI journey. Automated store checkouts and robotic warehouse management systems could be big bets for retailers, having high business impact but also requiring higher implementation effort.
Detailed AI use cases across the retail value chain, insights on the AI ecosystem in retail and how retailers can traverse the maturity curve are available in the full report.
Watch out this space for more interesting insights from the report.