While AI has become a strategic priority across the retail sector, many businesses are still grappling with how to turn their AI ambition into executional reality and performance, says news research from HyperFinity.

Its study of 200 senior retailers revealed that 91% feel under pressure to adopt AI to remain competitive, with half (53%) describing the technology as “one of the most important initiatives” within their businesses.

The AI competence gap

Yet, many retailers are still struggling to translate investment into coherent and robust innovation roadmaps. Only 46% have a well-defined AI strategies in place supported by clear value cases, while 42% of retailers remain uncertain about the commercial value AI use cases will deliver.

This, Hyperfinity suggests, points to a growing competence gap between brands that are operationalising AI and those that are still exploring how the technology can generate measurable returns.

Thomas Hill, Co-Founder of HyperFinity, said that this was creating a “growing divide” between those simply experimenting with AI and those embedding it operationally.

“Success won’t come from deploying the most AI. It will come from having the strategy, governance and decision-making frameworks needed to create value from it.”

This trend was echoed at the recent CommerceAI Summit, where brand leaders, including Papa Johns, Reckitt and Blackcircles, described how the the AI race is entering a new phase, requiring retailers to shift focus away from solving point problems to hardwiring intelligence directly into commercial decision-making.

The future of AI-led decision-making

Hyperfinity’s poll also showed that retail leaders expect AI to move beyond analysis and begin influencing day-to-day business decisions.

More than four in five retailers (83%) believe AI will either lead decisions or automate them within the next year.

Half (50%) expect AI to lead operational decisions while humans provide oversight and strategic direction, while a third (33%) believe AI will automate most trading, customer and operational decisions with minimal human involvement.

“The conversation in retail has shifted… retailers no longer need convincing that AI matters. The challenge now is building the capability to turn AI into measurable business outcomes,” added Hill.

However, Hill caveated that the next phase of AI adoption will focus on optimisation rather than automation alone, adding: “AI is exceptionally good at automating repeatable operational processes… but the bigger opportunity lies in helping retailers make better decisions.”

“The future isn’t AI replacing people. It’s AI providing recommendations, insights and reasoning that help people make better decisions faster,” he concluded.