Study: European retail grapples with AI implementation
Artificial intelligence (AI) is regarded as a key future technology in European retail. However, a recent study by London-based market research firm Retail Economics and Swedish technology provider Voyado reveals a significant gap between strategic ambition and practical implementation within the sector.
The report, “The State of AI in European Retail Marketing & E-Commerce”, highlights that the industry is in a transitional phase. While initial progress is evident, structural challenges continue to hinder development.
“The next two years represent a turning point as AI shifts from experimentation to a competitive necessity. Retailers are on a journey: most have begun testing and deploying AI, yet only a few have reached a stage where they are achieving consistent commercial returns,” said Richard Lim, CEO at Retail Economics.
Differences in the use of AI
The importance of AI is no longer questioned by most companies. There is a consensus that data-driven technologies will be crucial for future competitiveness, efficiency and customer satisfaction. The study shows, however, that the level of maturity varies significantly. While some pioneers have already deeply integrated AI into their processes, a large proportion of businesses remain in the experimental stage, testing individual use cases.
The use of AI is particularly widespread in marketing and e-commerce, where direct effects on revenue and customer loyalty are visible. Key applications include personalised product recommendations, automated campaign management and data-based analyses of customer behaviour. AI is also increasingly used for pricing and demand forecasting. In these areas, companies report measurable improvements, such as higher conversion rates or more efficient use of marketing budgets.
Hurdles in AI implementation
The study also identifies key obstacles preventing broader scaling. Problems with the data foundation are a primary concern. Many businesses struggle with incomplete, poorly structured or siloed datasets, which complicate the use of powerful AI models. Additional challenges include internal resistance to AI and a shortage of qualified professionals, slowing the development and implementation of relevant solutions. The integration of new technologies into existing IT systems also frequently proves complex.
In Europe, regulatory requirements and data protection also play a significant role, necessitating further adjustments.
AI as a strategic pillar
Beyond technological issues, the study also focuses on organisational aspects. Successful companies are primarily distinguished by their internal structure. They strategically embed AI at the leadership level, foster collaboration between specialist departments and IT, and adopt agile working methods. They also invest in targeted training to build the necessary skills internally. These factors are proving crucial for moving beyond testing to sustainably scaling AI.
Conclusion: Competition for the best AI solutions is increasing
Looking ahead, the study paints a clear picture: the importance of AI in European retail will continue to grow. Generative AI, in particular, opens up new possibilities in areas such as automated content creation, customer service and more precise offer personalisation. Companies that adopt these technologies early and effectively are likely to secure long-term competitive advantages.
AI is therefore no longer an option in European retail, but a necessity. The decisive factor will be how quickly businesses can overcome existing hurdles and develop scalable solutions from initial pilot projects. The competition for data-driven business models has already begun.
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