Retail and CPG Industries Embrace AI for Enhanced Supply Chain and Customer Experience

The retail and consumer packaged goods (CPG) sectors are increasingly turning to artificial intelligence (AI) to enhance supply chain operations and customer experiences, according to a recent survey by NVIDIA. The third annual State of AI in Retail and CPG survey reveals that a significant majority of companies are poised to boost their AI budgets in 2026, with a focus on open-source models and software.

AI Integration and Business Impact

AI is revolutionizing how retailers and CPG companies operate, from improving customer segmentation and personalization in marketing to enhancing demand forecasting accuracy. Intelligent digital shopping assistants and AI-driven catalog enhancements are elevating customer engagement, while physical AI systems are streamlining warehouse and supply chain operations.

The survey indicates a maturing AI landscape, with 91% of respondents actively using or assessing AI technologies. The impact of AI on business operations is substantial, with 54% of companies reporting improved employee productivity and 52% citing operational efficiencies. Notably, 89% of respondents acknowledge AI's role in increasing annual revenue, while 95% report cost reductions.

Open Source and Agentic AI

Open-source AI models are gaining traction, enabling retailers to customize solutions to their specific needs while maintaining control over their data. This shift from proprietary systems to open-source solutions allows for greater innovation and integration into existing workflows. Jason Goldberg of Publicis Groupe highlights the advantages of open-source models in avoiding vendor lock-in and leveraging community-driven advancements.

The survey also highlights the emergence of agentic AI in retail, with 47% of respondents using or assessing these technologies. Agentic AI is poised to transform supply chain operations, offering real-time inventory management, dynamic pricing, and vendor negotiations. Chris Walton of Omni Talk emphasizes that the ROI of agentic AI will be most evident in supply chain efficiencies.

Challenges and AI-Driven Solutions

The retail and CPG sectors continue to face supply chain challenges, exacerbated by geopolitical instability and evolving consumer expectations. Sixty-four percent of respondents report increased complexity in supply chains. AI is seen as a solution to streamline operations, with 51% of respondents prioritizing AI for operational efficiency and throughput.

Physical AI is also gaining ground, with 17% of companies evaluating its potential. In-store robotics and smart infrastructure are expected to enhance inventory management and customer service, offering a more responsive and efficient retail environment.

NVIDIA's survey underscores the transformative potential of AI in retail and CPG, with companies increasingly investing in AI solutions to drive innovation and meet evolving market demands. For more information on the survey, visit the NVIDIA blog.