How AI Integration can Redefine the Mechanism of the Retail Industry in 2022
How AI Integration can Redefine the Mechanism of the Retail Industry in 2022

We can say without a doubt that technology has brought about revolutionary changes in the way the world works. New-age tech such as Artificial Intelligence (AI) and Machine Learning (ML) has been instrumental in spurring several innovations both in our individual lives and from a business standpoint. Today, the world is becoming increasingly reliant on technology-driven systems in nearly every aspect. One such technology that has proved to be a game-changer for businesses across verticals is video analytics.
At a time when the phrase ‘data is the new oil’ holds true, video analytics helps businesses process large volumes of data seamlessly, enabling them to minimize cost and enhance productivity and accuracy. With every element of operations being integrated with smart technology, i.e., AI or IoT (Internet of Things), video AI analytics is no longer limited to just security surveillance. It offers numerous intelligent solutions and diverse uses through which the very working mechanisms of industries can be redefined. One such industry that offers plenty of scopes is retail.
AI and Retail: An Introduction
Although AI integration in the retail industry is not a concept that is unheard of, it is a segment that is yet to be fully tapped. When blended correctly with the retail industry’s workings, AI can work wonders not just in elevating the shopping experience for customers but also for the business in terms of garnering consumer insights, allowing the company to cater better to changing consumer demands. Now, although e-commerce has seen a significant boom in recent years, physical retail stores are certainly here to stay for the foreseeable future. However, they do face certain lesser-known yet crucial issues.
The Challenge
It’s well known that the retail industry largely relies on good customer service and smart marketing to sustain the business and drive growth. Although physical retail stores do garner sufficient customer insights, even if they do so manually, there is no additional support system that can assist them in making informed decisions in real-time and ensure that the large volumes of data are easily accessible and comprehensive. This is where retail stores lag when compared to e-commerce stores. E-commerce is leading the retail space due to the ability to track everyday customer inflows, dwell time, order conversions, and product preferences through technology-enabled systems. This makes it possible for e-commerce platforms to personalize recommendations and browsing content based on previously gathered data. For offline stores, AI-enabled video analytics is key.
The Role of AI in Enhancing the Retail Industry’s Working

While it may seem that the CCTV cameras in retail stores simply monitor the premises for security, their functions transcend that. With AI-enabled video analytics, CCTV cameras can identify and collate the events taking place at the store. Besides, since they are equipped with facial recognition, these cameras match the customer’s identity with their shopping preferences and pattern to provide critical data points for stores to devise their marketing strategies accordingly.
Let’s consider an example. When you walk into a clothing store, and you are simply browsing through the apparel, the CCTV camera captures your face and activities in the store right from the time you enter to the time you leave the store. That said, here are a few things that video analytics can help monitor, elevating the store performance as well as customer experience.
Footfall Analysis and Occupancy Checks
An average retail outlet often sees several customers entering and exiting the store. AI can help track this number accurately since it has the data for real-time occupancy of the store at any given time when the store is open. Footfall analysis and occupancy checks can go a long way when it comes to monitoring the store on an hourly or daily basis and help the store further drive footfall.
Heatmap Analysis

Retail players can utilize AI-enabled video analytics to identify the most popular spots within the store. This will allow the store to analyze which product is gaining the most traction and will help them make smart decisions driven by data.
Staff Productivity Check
CCTV cameras equipped with AI can track staff within the store to monitor productivity. Besides, it also assists stores in analyzing the number of staff members required based on the footfall the store receives. This will facilitate cost efficiency as stores can optimize the human resources or repurpose their staff.
Queue Management and Demographic Analysis
During peak times such as festive seasons or holidays, stores tend to become crowded with bottlenecks at the billing counter. Through AI integration, stores can monitor the length of queues at counters while calculating the average waiting time for each customer, making counter optimization easier. Additionally, AI-enabled cameras can analyze the age demographics of customers visiting stores, making for efficient inventory procurement and management and smart marketing. These cameras can also keep track of repeat customers through facial recognition and allow businesses to enhance customer experience and drive retention.
The ROI (Return on Investment) Perspective
When it comes to AI integration, the retail industry can benefit from optimized costs that would otherwise go into manual monitoring and auditing. Utilizing the data that CCTV cameras in stores garner, retail businesses can devise strategic marketing campaigns, avoid redundancy, streamline their overall operations, and boost store performance and customer satisfaction.
The Safety and Security Department’s Standpoint

Although CCTV cameras embedded with AI technology have transcended it, their primary function is to ensure security at the premises. At a retail store, AI-driven cameras can track hostile customers, identify suspicious activity or theft, and pilferage of items in real-time, allowing the management to take swift action and save costs.

Retail stores must adapt to shifting trends. They must also be able to measure and optimize their methods fast in order to do so. The retail landscape is rapidly evolving, and AI integration will further spur progress. Given the countless benefits it offers, AI is bound to pave the way for innovations and is undoubtedly the way to go for the retail industry.

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