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The World Economic Forum predicts a significant rise in retail AI investments, reaching US$31 billion by 2028. Global retail leaders like eBay, Walmart, and Nordstrom are actively integrating Generation AI (Gen AI) for diverse applications, while in India, 71% of retail businesses plan to adopt Gen AI within the next 12 months. Despite the immense potential, organizations face challenges, with 80% expressing low-to-moderate readiness, citing unclear use cases and a skills gap. Currently, partnerships with external tech providers are the favored mode of implementation.

Gen AI brings valuable insights to retailers, but ethical considerations loom large. Privacy concerns arise with location tracking for real-time promotions. Retailers must ensure transparency in data usage, clarifying to consumers what data is collected, why, and how it will be used. Biases in data pose another challenge, as overrepresented demographics can skew recommendations. Retailers must vigilantly ensure diverse and unbiased data pools. As the retail sector undergoes an AI-driven transformation, leaders must balance innovation with ethical responsibility, respecting and protecting consumer data for an enhanced shopping experience. Board, CEO, and CIO leadership are pivotal in crafting and implementing a robust Gen AI strategy.