Select Page

Artificial Intelligence (AI) is a term we have known for a long time. However, this word has been buzzing more often than ever. The word immediately brings the image of an elegant glass robot to our minds. We also know that such conceptions are insufficient to comprehend what AI really is. In the course of this blog, we will see plenty of examples that seek to encompass the essence of AI. However, the topic at hand is not just AI but the impact of AI on the retail industry. The objective here is to shed light on how AI can and has already started to impact how retail brands and businesses conduct business with loud and visible results.


Personalisation has been a buzzing term for quite some time now. However, the entry of Artificial Intelligence (AI) changes the dynamics of personalisation. AI is capable of analysing more complex data and providing far more insightful information for far better personalisation efforts than how it is simply possible with human-made programs. The thing with AI is that it can learn and improve itself. These capabilities can be applied not just for sending personalised recommendations but also to improve the shopping journey of customers. Let us explain this with an example riding on potential AI capabilities.

We have seen how retail and eCommerce brands email or show us product recommendations (which sometimes also reach our social media feeds). Most of these recommendations are futile unless there is something extraordinary in the offers. AI can transform the entire game of personalisation in retail and eCommerce. AI holds the potential to help retailers learn beyond what customers have already explored within their website/app. AI is capable of analysing data on multiple parameters to derive new customer insights and analytics. For example, AI can learn by picking up what is not searched by customers. Among other things, it means either a customer does not require that product or is buying from some other place. Even that could be narrowed down further if more data is provided to reconcile with trends in similar conditions.

AI does not mean preying on the websites of competitors. The internal data alone is sufficient to provide a galore of new insights for improved personalisation efforts.

Demand and Trend Analysis

AI has a far bigger role to play in demand and trend analysis. We are no longer talking about static statistical models but ones that can learn and improve analytical output with the help of AI. This will significantly help retailers in making more informed and reliable decisions on market behaviour. AI can process massive volumes of data from diverse sources to arrive at more reliable correlations between different market variables to better predict demand patterns and trends. The best part is that it can help spot new product and market opportunities.

For example, not all departmental stores can make the best out of the festive season sales. One of the main reasons for this is that they have little information to do it. They rely on their legacy systems and human judgement which often are constraining in forecasting future demand with detail and precision. The use of AI-based analytics can bridge this gap. AI can process data from different internal and external sources across different timelines, apply learning, and present conclusions that are backed up by evidence. When a departmental store has access to such analytics, it can make its festival-specific purchase decisions with a higher level of awareness and confidence.

Process Automation

Although process automation in changing forms arrived a long time ago, the application of AI is changing how and to what extent business processes can be automated.

In traditional forms, retail process automation platforms are straightforward programs. They do what the codes tell them to do without the element of so-called ‘intelligence’. AI brings in the components of learning and improvisation which is why it is regarded as ‘intelligent’. This enables the incorporation of more dynamic adjustments to how automation works. AI enhances the capabilities of automation. This kind of automation is no longer confined to the idea of automating bulky and mundane tasks or reducing human errors and mistakes. It goes far beyond that.

Chatbots and virtual assistants powered by AI can be used as an example here. These programs can learn and improve their response mechanism. It can figure out quicker ways to resolve queries. For instance, if queries on delivery are marked as resolved by customers when a particular set of information is provided to them, the chatbot can be trained to present that information and it will shorten the query resolution process. In this case, AI is not only carrying out a process but is also trained to improve it.

Inventory Management

Companies around the world are now using or considering the usage of AI in inventory management. Done right, AI can help a company improve its inventory management in multiple ways. A few of them are discussed next.

We have already discussed how AI can help in demand forecasting. With more accurate and timely demand projections, businesses can avoid undesirable situations like overstocking, under-stocking, or even running out of stock. All one needs to understand is that instead of relying on human judgement or simple projection software, AI does the same job for us by analysing more information and deriving more complex interrelationships between hosts of variables.

Another advantage provided by AI is that it can help in optimising warehouse space. For example, it can help classify inventory based on their movement. This enables the stacking of goods based on frequency of requirement. Goods can be rearranged accordingly. The application of such tactics allows businesses to make the best use of the available space in their warehouses.

AI also eases the re-ordering decisions. After demand forecasts are available, warehouse and purchase managers also need to determine the ROQ levels of the existing inventory. Even if it is a routine purchase, ROQ levels still have to be ascertained. Then there is also the quotient of ROLs. The involvement of all these elements makes reorder decisions challenging for the human mind. AI can be trained to comprehend such complex equations towards facilitating decision-making.

Customer Orientation

We know how AI can significantly improve customer support mechanisms like chatbots. However, in the bigger picture, we need to see how AI can help businesses become customer-oriented. It is one of the best compliments you may want to hear as a retailer. AI holds tremendous potential in helping businesses adopt customer orientation. For example, in market research, AI can help derive deeper insights into the needs and expectations of the target segments. It can be trained to analyse demand patterns and predict emerging gaps in markets. The awareness of such gaps can prove to be a big competitive advantage. These gaps could be in products or services or any other element in the value chain or the customer shopping journey. Say that a retail departmental store figures out that sustainability is an emerging concern among customers. The store can capitalise on this insight and carry out some rebranding exercises to communicate the same to customers and the public in general in the given market. Customer orientation need not always be transactional in nature; it is more centred on the concept of value. Thinking of such applied benefits of AI carries transformational capabilities.

Use of AI in IoT applications

Think of AI as a way of thinking. Wherever it is applicable and you apply it, it can enhance the capabilities of that system. IoT (Internet of Things) is one such system. There are two elements in the word IoT – internet and things. Here, things refer to all kinds of devices and assets that can be connected to the internet. IoT is the networking of these devices and assets over the internet. When IoT and AI come together, we are talking about an intelligent network of devices that share and process data and derive meaningful information and insights for improving the quality of the ecosystem to where it is applied.

Today, IoT is already being used in many areas of retail like inventory management, managing smart shelves, asset tracking, personalisation, and customer experience in retail. A simple example of the use of AI in IoT is predictive repair and maintenance. In this particular case, AI-IoT changes how retail businesses dealing in electronic and electrical appliances can extend their value propositions. AI-powered IoT solutions can predict requirements for repair and maintenance or purchase of utilities more accurately and relevant to customers. It is an opportunity for retailers to keep their brand connections active with customers.

The thing with AI is that it can learn and improve itself. These capabilities can be applied not just for recommending products but also to improve the shopping journey of customers. AI has a far bigger role to play in demand and trend analysis as well. The application of AI is changing how and to what extent business processes can be automated. Companies around the world are now using or considering the usage of AI in inventory management. Considering the bigger picture, AI can help businesses become customer-oriented in more profound ways. Something to watch out for will be the integration of AI and IoT in retailing.

Get advise for Retail Business Consulting.


How can AI help sales?

Let us understand this with an example. Not all departmental stores or supermarkets can make the best business out of the festive season sales. One of the primary reasons for this is that they have little to no information to accomplish it. These businesses rely on their human judgement or legacy systems which, in today’s context, are constraining or limiting in projecting future demand with detail and precision. The use of AI-powered analytics can bridge this gap. It can gather and process data from different internal and external sources, apply learning, and present insights backed up by statistics. When retailers have access to such analytics, they can make their purchase decisions for festive seasons with a higher awareness and confidence.

Can sales be replaced by AI?
Right now, AI has the capabilities of being a good facilitator in executing business processes or a more advanced guide in business decision-making and planning or analytics. For AI to be able to take over any business process (including sales) in its entirety does not seem anywhere close. However, human intervention in many business processes or tasks may go down making some skills redundant. Another way to look at it is that there will be a need for new skills that cannot be fulfilled by AI-powered automation solutions.
What is the future of AI in retail?

The thing with AI is that it can learn and improve itself. These capabilities can be applied not just for recommending products but also to improve the shopping journey of customers. AI has a far bigger role to play in demand and trend analysis as well. The application of AI is changing how and to what extent business processes can be automated helping retailers achieve reduced costs and improved margins. Companies around the world are now using or considering the usage of AI in inventory management. Considering the bigger picture, AI can help businesses become customer-oriented in more profound ways. Something to watch out for will be the integration of AI and IoT in retailing.
For service-related enquiries on retail IT automation and SOP-IT integration or to speak to one of our retail consultants, please drop us a message and we will reach out to you.

Retail Healthometer

Check the health of your business? Are you ready to organize & scale ?

Author Bio

 Nikhil Agarwal

Nikhil Agarwal

Chief Growth Officer

Nikhil is a calm and composed individual who has a master’s degree in international business and finance from the United Kingdom. Nikhil Agarwal has worked with 300+ retail e-commerce brands and companies from various sectors, since 2012, to define their growth strategy and achieve operational excellence. Nikhil & his team have remarkable success stories of helping brands achieve 10X growth.

Get In Touch


    The idea of having Ecommerce Consultants on-board from the beginning itself points towards reducing the involvement of the promoters in daily operations. Ecommerce Businesses willing to be a brand reaping profits & sustaining the competition must ensure that most of their processes should be automated. The more the manual intervention, the more would be the errors.

    In Ecommerce business, you get only 1 chance to impress the customer & if you mess up there, you lose the customer for long.

    Process automation in respect to all the activities pertaining to customers from order receiving to order fulfilment is a must for a seamless experience for the customers.

    Task Management is another grey area where most deadlines fail as 90% of the tasks are assigned manually & are forgotten, unheard, misunderstood or mistaken.

    YRC Team of Ecommerce Management Consultants helps to make maximum of the processes system-driven to ensure minimalistic manual intervention.


    No matter how good your product is, the customer would know only if it looks good.

    Photography includes the following steps:

    • Cataloguing your products
    • Cataloguing your images
    • Backup your images (A few cloud storage solutions include Dropbox, Google Drive, Bitcasa, Apple’s Cloud Storage etc.)
    • Choose the right camera & lens (You may also outsource the photography to a third party agency)


    Digital Marketing includes SEO & SMM. SEO i.e. Search Engine Optimization includes activities like back-linking, meta tags, blog-writing etc. to ensure your website ranks on the 1st page on Google Search.

    Next comes SMM i.e. “Social Media Marketing” which as the name suggests including promoting your products on all the social media sites, email marketing, influencer marketing & several other BTL activities.

    These activities are going to be recurring & would decide the traffic on the website, the conversions, whether the right target market is tapped, the likes, the views, the orders, the reviews & much more. YRCs Ecommerce Consultants create a budget for digital marketing right from pre-launch to launch & for each month thereafter.

    Building digital marketing strategies in coordination with the agency, selecting them to signing them off would be the role of YRC.

    This ensures seamless coordination, detailed interactions & desired execution as it is always advisable to work with a single agency than multiple of them.


    Selection of the right software for smooth functioning of back-end operations right from production to webstore display would be suggested and integrated by YRC Team.

    YRC’s Team defines SOPs of Product Movement, maps it with the locations & people. They then create a blueprint of all the features required in the software & help in shortlisting & selection.

    IT Integration involves connecting your offline inventories with real-time online webstore so when a sale occurs, inventories get deducted real time across offline as well as online platforms.

    This helps in accurate inventory management, maintaining the MOQs, re-order levels & achieving the optimum inventory levels.

    Some popular software include unicommerce, viniculum for your front-end website management & Genisys for your entire back-end Purchase, Production, Accounting, Invoicing etc. management.


    • How many cities or countries you wish to sell in?
    • Where should your Warehouse be located?
    • Should you have one warehouse in each country or city?
    • Should you be having your own delivery team in your base city?
    • Would the 3rd party vendors be reliable? What happens when they lose or misplace your product during delivery?
    • How should I manage the logistics if my goods are coming from different countries?
    • How should the goods be stored and barcoded?
    • How much space do I require for warehouse?
    • I am sure several such questions must be haunting you while you think of starting your own fashion ecommerce brand.


    At YRC, our warehousing and logistics experts can help you devise a strategy for all of the above mentioned queries and much more.

    We design the layout of the Warehouse considering the inward, goods processing, software entry, barcoding, outward, goods return, scrap storage, goods stacking & much more.

    Logistics route plan is devised considering the manufacturer to your warehouse and from there to last mile delivery locations.


    This Step involves 03 distinct parts:

    Part 1: Choosing the right Platform:

    From several platforms available in the market right from Shopify to magento, woocommerce, prestoshop, wordpress etc. you must choose the one that fits best for your business

    Part 2: UX Designing:

    “UX” denotes User Experience, which if put in simple language is building the functional requirements of the website.

    UX Designing includes designing the features required in the website, customer journey map, website features, the browsing features, navigation features, ecommerce order management process flow, checkout cart features, catalogue management, ecommerce payment system, cross selling features & much more.

    “As per statistics, 68% of the customers abandon the carts before payment”

    An interesting UX ensures the customer sticks on to the website for a longer time.

    Part 3: UI Designing:

    UI stands for User Interface, which means designing the look and feel of the website. UI includes using the right colours, elements and the entire aesthetics of the website.

    A good User Interface ensures the user completes the task that he has come for. It navigates the user through the journey of the brand in the simplest but most effective way.

    The UX designer maps out the bare bones of the user journey; the UI designer then fills it in with visual and interactive elements.

    If User experience is the bare bone, user interface wraps it up with an attractive cape.

    At YRC, our team if experts can help you develop the entire User Journey to ensure it is engaging!


    This step follows the “Designing” Phase, whether you have an in-house design team, freelance designers or an outsourced design company. It is one of the most exciting phases, as here you see your designs turning into products & your ideas turning into reality.

    In most start-up cases, production is outsourced i.e. brands tie-up with the established manufacturers/ job-workers to get their products manufactured.

    Sampling involves multiple 04 Stages, Fit-Sample, Prototype Sample, Pre-Production Sample & the Production Sample.

    Prototype Sample is the first sample provided to the buyer. It can be in any fabric/ colour. This sample is just to understand whether the product design looks equally great in reality.

    Fit Sample, as the name suggests is prepared to check the fit of the garment i.e. the various sizes, length, width etc.

    Pre-production is made by the actual production line. Here the stitching quality and other aspects related to manufacturing are checked. This is the last stage where rejection can be accepted.

    Production Sample is made before the production which is the replica of what is going to be finally produced.

    Once you are through with all this, you are good to go ahead & get your goods manufactured.


    Product Designing or Sourcing is the heart of the Ecommerce Fashion Brand.

    Product Designing / Sourcing can be done in several ways, as follows:

    • In-house Design Team
    • Freelance Designers
    • Outsourced Design Team
    • Ready Product Sourcing (From Manufacturer or Wholesaler)

    At YRC, we evaluate your business strategy & business model to arrive at the decision, which of the above ways would be best-fit for your business. In certain cases, product sourcing may be a combination of the above.

    These are the people who are going to build your brand! Whether they are the designers or merchandiser, your brand look is going to be in their hands.

    If you are designing each garment from the scratch, the sourcing would play crucial role in developing design identity of your brand.

    Sourcing includes fabric, trims, lining & all the raw material required to build the garment.


    Branding is the “Look of the Brand”, right from logo to tagline, the colours used, the brand story, the brand communications on social media, the packaging & all the other aspects which speak directly or indirectly to the customers. Branding constitutes the look & feel of the brand & hence must be thoughtfully planned to match with the product that we are selling.

    Branding must appeal to our target audience. Example : A golden colour logo depicting finesse, art, richness, premium, however beautiful it may be individually cannot go with a brand selling affordable kids wear products. So, your logo must be in-line with your brand positioning, whether you are an expensive brand or a luxury brand or a value for money brand, it must be depicted from your “Branding”.

    It is an integral part to attract the target audience.


    Organogram is the “HR Blueprint” of the business which is created at the onset, to map out the team required across each function at various stages of the business. At the launch, only key people need to be got on board to ensure the project gets started & at this stage, all of them need to multi-task. Similarly, certain financial as well as operational goals are set for addition of the further team. Example, for the operations team, we hire 1 operations manager during the pre-launch phase & we add 1 more only when the business kicks-off & we reach a volume of selling more than 1000 pcs/ month or a turnover of more than 0.1 million USD.

    SOPs are Standard Operating Procedures, a bible to run the entire organization right from Sales, Purchase, HR, Order receiving to Order fulfilment, Inventory Management, Accounts, Warehouse, Logistics, Supply Chain, Production & all the other relevant functions for the business. Business must be organized from its first day of operations; only then the tasks can be delegated.

    At YRC, we design the organization structure, the processes, and approximate time taken to execute each process, job profile of every member within the organization, their KRAs, KPIs & the Reporting Structure.


    Critical Pathway Analysis (CPA), is a project management technique which cannot be overlooked while launching an ecommerce fashion brand. Brand launch process is cumbersome with multiple inter-dependent & time-bound tasks involved, which need to be tracked to ensure the project remains on track.

    CPA outlines key tasks across the project, their turnaround time (TAT) & the dependencies of tasks upon each other. It identifies the sequence of tasks, their interdependent steps from inception to completion, their criticalities, and their dates of onset, target dates of completion along with the key responsible person for the respective activities. Critical Pathway helps in understanding the unimportant & not urgent tasks which may jeopardize the execution of the project because of an unexpected snag! It also maps out the potential bottlenecks which might be posed because of the dependencies of tasks upon each other & cases where the next task cannot be commenced before the completion of the previous one.

    CPA detects the minimum & the maximum time involvement of a particular individual or team to execute the task, thereby arriving at the overall deadlines associated with the project.

    At Your Retail Coach, we design the Critical Pathway & review it periodically to ensure the project is on track & the progress is measurable.


    Business Strategy includes the vision, mission, goals, business model, business plan & strategy for all the functions within the organization.

    Business Strategy is a well-defined plan that outlines who, what, where, why, how & when for the company; for example, who would be the target market, how to attract the target audience, when to launch new products, where to operate from, how to handle competitors, what would be the USP, what would be long term goal of the organization & several other answers to the 5Ws of Strategy.

    Business Strategy aligns the organization towards a common goal. Business SWOT helps company to identify & overcome their weaknesses & focus to sharpen the strengths. Business strategy forecasts future risks and helps business in building skillsets to overcome the potential threats.

    YRC’s Business Plan focuses on creating a “Blueprint” of the business, thereby deriving the feasibility of the concept & gauge whether the opportunity is lucrative to invest time, energy & effort. Business Plan creates cash flow understanding i.e. building inflow & outflow cash projections from Week zero to week 60 i.e. 05 year projection. Business Plan calculates the capital investment, operating costs, one-time costs, recurring costs & all the other numbers relevant to obtain the breakeven sales, return on investment, return on capital, internal rate of return & several other ratios. Business Plan is also one of the important requirements if you are targeting the “Investor Route”. Fund raising becomes extremely transparent & channelized. With business plan panned out clearly, the business will know until what point must it be stretched & where to stop, which reduces the probability of unplanned investments.


    Starting the concept of Ecommerce Fashion brand with Market Research ensures we get detailed understanding of the industry & this research report also acts as a social confirmation for your concept. Market Research helps in understanding the target locations, their population, potential online buyers for your product, competitors for each category, and top selling products of the competitors, competitors’ price range, offers & their responses & much more. Market Research helps in thorough understanding of your brand position as compared to our competitors. It helps in identifying gaps in the market, in your category along with the scope of the said product in the desired market. This will help in validation of your concept & prevents you from making the same mistakes as your fellow brands, eventually saving your time, energy & efforts. This phase is also a make or a break phase, as the market research study may at-times come up with some eye-popping numbers & statistics which might compel you to re-think on your product or category that you are planning to sell or alter your entire concept itself!! Market Research Reports analyse the competitors’ webstore for their traffic, conversion & sales. This is extremely valuable information to derive our inventory budgets & projections, which takes us to our next phase.