Nvidia releases its Annual State of AI report underlining the adoptions, investment, and finally the impact of Artificial Intelligence in the retail and CPG (Consumer Packaged Goods) industry. As per the report,  94 percent have said AI has helped reduce annual operational costs while 97 percent have said that spending on AI would increase in the next fiscal year. 

Apart from all these, around 80% of the companies in the retail or CPG sectors are either using Gen-AI innovations or plan to use them as they lie in the pilot phase. 

Survey Findings 

Collected from hundreds of  industry professionals, the surveys managed to conclude the following findings successfully:

1. 89% of respondents said they are either actively using AI in their operations or assessing AI projects, including trials and pilots (up from 82% in 2023)
2. 87% said AI had a positive impact on increasing annual revenue
3. 94% said AI has helped reduce annual operational costs
4. 97% said spending on AI would increase in the next fiscal year

Gen-AI boom 

Generative AI has firmly established itself in the retail and consumer packaged goods (CPG) sectors, with more than 80% of companies actively using or testing the technology. Businesses are leveraging generative AI primarily for content creation in marketing and advertising, as well as for customer insights and analytics. The top use cases for generative AI in retail include:

1. Content generation for marketing- 60 percent 
2. Predictive analytics- 44 percent 
3. Personalized marketing and advertising- 42 percent 
4. Customer analysis and segmentation- 41 percent 
5. Digital shopping assistants or copilots- 40 percent 

AI in the Supply Chain

Managing the supply chain has always been a challenge for retail and CPG companies, but it’s become increasingly difficult over the last several years due to tumultuous global events and shifting consumer preferences. 

Increasingly, companies are turning to AI to help address these challenges, and the impact of these AI solutions is starting to show up in results.

1. 58% said AI is helping to improve operational efficiency and throughput.
2. 45% are using AI to reduce supply chain costs.
3. 42% are employing AI to meet shifting customer expectations. 

Read about AI in Mobility as: Hyundai partners with Nvidia to drive AI-powered mobility solutions

Challenges ahead

In 2024, the biggest AI challenge for retailers was the lack of accessible and explainable AI tools. This highlighted a growing demand for new software and solutions, particularly in generative AI and AI agents, to simplify adoption and help companies better understand how these technologies function.

Read about Nvidia's latest AI innovation at: Nvidia expands GeForce Now to steam decks and VR-AR devices boosting accessibility for gaming enthusiasts