AI could 'unlock' billions of dollars for America's biggest retailers

In a recent note to clients, Morgan Stanley analyst Alex Straton wrote that agent AI could save some of America's largest retailers a combined $6 billion and boost their profits by an estimated 20% by 2026.

The report ranks fashion brand Gap, department store chain Macy's and lingerie retailer Victoria's Secret as the three standouts best positioned to capture these benefits.

Straton’s analysis estimates that AI-enabled tools like inventory planning, supply chain automation and automated customer service could save retail chains about $6 billion in annual costs. If realized, that could boost industry profit margins by about 200 basis points.

But not everyone is convinced that these numbers will translate smoothly. David Swartz, senior equity analyst at financial services firm Morningstar, is skeptical about how retailers are actually talking about and implementing AI. According to Swartz, no one has really quantified these numbers.

He added that the use of AI is being talked about in many different ways. But how AI integration saves businesses money over time is difficult to determine.

Morningstar analysts ran through real-world applications of AI, many of which align with Morgan Stanley’s scenarios. Marketing, product recommendations, coupons, even design can benefit from AI. For example, AI can help retailers target customers more precisely and test promotions more quickly than legacy systems.

Like Morgan Stanley, Mr. Swartz said that internal operations like inventory management could become more efficient in the long term as AI helps retailers know what and how much to order. He added that improved demand forecasting could reduce promotions and waste—a chronic problem in the retail industry—and thus improve profit margins.

Swartz cautioned, however, that retailers may see improvements as AI adoption increases, but the technology won’t transform the industry overnight. AI isn’t a panacea for all problems, he said. The U.S. retail market remains extremely competitive. And if every business has access to the same technology, it’s hard for anyone to gain any real advantage.

Source: https://vtv.vn/ai-co-the-mo-khoa-hang-ty-usd-cho-cac-nha-ban-le-lon-nhat-nuoc-my-100250926151557314.htm