Artificial Intelligence Revolutionizing Retail Industry

Artificial intelligence (AI) has become a phenomenon of our time. Retail chains in the Czech Republic and worldwide are trying to utilize it to improve their businesses. AI is helping with security, negotiating prices with suppliers, and even advising customers through chatbots.

Although AI has recently become a hot topic, some retailers have used it for years. An American retail giant, Walmart, began using AI in negotiations with its suppliers. The chatbot software from Pactum AI replaced Walmart’s human purchasing team, reportedly achieving lower prices for the retail chain. Walmart’s employees only need to inform the software of their budget and requirements, and the AI communicates with the suppliers.

Thanks to robotic contract management, Walmart saved an average of three percent. Although the use of AI was reported by Bloomberg this year, the retail chain has been using it since the end of 2021. The company claims that the success rate of closing deals with suppliers is approximately 68 percent.

The Pactum AI software can handle a wide range of problems, including discounts, payment terms, and prices of individual products. “We give the requirements, and the AI gets the result,” said vice president for international activities Darren Carithers about the chatbot’s deployment. He also added that the price negotiation period had been reduced from months to days.

However, the use of AI in retail can have certain disadvantages, as noted by the Bloomberg agency. For example, chatbots may be unable to recognize and solve more complex problems requiring human creativity and empathy. Some people also prefer personal contact and relationships when negotiating business terms.

French retail chain Carrefour launched a chatbot last month that helps people with their shopping. It can even create shopping lists or automatically select food according to chosen recipes. Instead of creating its chatbot, the retail chain partnered with start-up OpenAI, behind the ChatGPT phenomenon. The Carrefour version, however, is called Hopla.

Carrefour has clarified that the modified version of ChatGPT differs significantly from the original system. The chatbot was limited to serving the exclusive needs of the retail chain’s customers. Hopla is available to customers directly on Carrefour’s French website. When a person does not have time or inspiration to create a shopping list and choose food, this sophisticated system provides them with a helping hand.

One of the advantages of AI is its ability to identify non-standard behavior. In the Czech Republic, for example, Beroun’s automatic COOP retail chain uses AI to help protect against thieves. Continuous analysis of CCTV footage can detect unusual behavior of customers, which is reported to the central security or store staff. If a person puts the goods in their pocket or bag instead of a basket, a notification and a short video with the suspect are sent to the employees’ mobiles.

If the store is self-service and operates in automatic mode, which is the case in Beroun from 5 p.m. to 6:30 a.m., the system can notify the thief that they are being watched. In automatic mode, a QR code in the mobile phone linked to the bank identity is required to enter the store, making it easy to identify potential thieves for the police.

AI has become a powerful tool in the retail industry, helping to improve security, reduce costs, and provide better customer experiences. As AI technology advances, we can expect even more innovative ways retailers can leverage it to their advantage.