AI/ML

How Fast Is Retail Really Changing? The Truth Beyond the Hype

By Greg Buzek Nov 14, 2025 7 Min Read

How fast is retail really changing? It’s the question I get asked constantly at conferences, in client briefings, and from retailers trying to figure out where to place their bets.

The honest answer? Faster than most people realize, but probably not in the way they’re thinking about it. This whole AI change is like taking a battleship in the middle of the war and turn it into an aircraft carrier. But those that make the change see sales growth 2.5x higher and profit growth 2.3x higher in our research than their peers. And this is why Sales Leaders (those with sales growth 10% or more) are growing IT spend 3.8x that of the average retailer in their segment.

We live in an era where the industry obsesses over headlines: ChatGPT, autonomous robots, just-walk-out technology. Those stories are real, and they’re impressive. But they’re also distracting us from something more fundamental that’s actually reshaping competitive advantage right now.

The retailers, restaurants, CPG companies and autos winning today aren’t the ones waiting for the next technological breakthrough. They’re the ones deploying technology in the foundational areas that matter most. This is exactly what we help companies do with our ClearSight AI process.  Figure out where the biggest opportunities are, where you have the best data and corporate alignment. That’s where the real story of retail transformation becomes clear.

AI Is Already Baked Into Enterprise DNA

Let’s look at the announcements just this week.

PepsiCo is running smart packaging systems that autonomously optimize over 300 different manufacturing parameters in real-time. Their AI doesn’t just report—it acts. It tweaks settings, adjusts outputs, and reduces waste without human intervention. That’s not coming soon. That’s running right now on production lines.

BMW faced a massive modernization challenge: moving 10,000 data dashboards to the cloud. Using traditional methods, each dashboard would take about 10 days to migrate. Do the math—that’s over 27 years of engineering work. But with generative AI handling the heavy lifting, they’re completing individual dashboards in just hours. That’s not incremental improvement. That’s fast-forwarding entire transformation timelines.

Wakefern, the company behind ShopRite, is deploying agentic AI in their supply chains. This is different from regular AI tools that generate reports and then takes action. It forecasts what needs to be ordered, identifies the right vendors, and solves supply chain problems in real-time. In grocery, where every minute counts for fresh food, this is a game-changer.

Ecolab isn’t dipping their toes in anymore. They’re building an entire AI center of excellence with Accenture and Microsoft, starting with their core operational functions (procurement and  finance), the infrastructure of the business.

Leading retailers and CPG companies aren’t viewing AI as an edge case application anymore. It’s becoming the operating system underneath their entire business.

The In-Store Revolution Happening Right Now

Walk into a store today, and you’re seeing retail innovation move at surprising speed.

Tesco’s two-part approach is an interesting option. Their scan-as-you-shop service gets an upgrade: shopping carts with built-in scales. It’s a simple technology, but it creates verification. Customers scan an item, the scale confirms they have it, and the system matches. Simultaneously, their app now sorts shopping lists based on the actual aisle layout in the store. No more backtracking for milk. No more confused paths through the store.  But will those carts go missing? That is the big question.

In London, the Wolverhampton Wanderers are running a popup store with Amazon’s just-walk-out technology. On match day, crowds pack in, energy is high, and the last thing fans want is standing in line. They grab a jersey, grab a scarf, and walk out. The transaction completes in the background. On a packed Saturday, that changes the entire experience. This is played out all around the world. Thankful for this and other just walk out technologies at stadiums and airports.

In Central America, a retailer called Mega Super solved one of self-checkout’s most annoying friction points. You’re buying apples or bananas, and the system asks you to look up the produce code. Nobody remembers these. Their AI just looks at the produce, recognizes it by image, and charges the right price. Toshiba Global Solutions, NCR Voyix and others have been demonstrating this at trade shows for years.  Nice to see it in action as it removes a source of customer frustration that happens hundreds of times per day.

Varner, a Scandinavian fashion group, is basically killing the traditional cash register. They’re giving staff handheld devices so they can complete transactions anywhere on the sales floor.

The Reality Check: Why Shelf Intelligence Matters Most

For the last decade, retail has been obsessed with digital transformation. Omnichannel investments, mobile apps, click-and-collect, marketplace integrations—all legitimate priorities. But while everyone’s been focused on the digital front end, something critical has deteriorated: the simple act of knowing what you have in stock and keeping it on the shelf.

And it’s costing them.

Research from IHL Group and Scandit shows that retailers lose over $1.7 trillion every single year because of out-of-stocks. That’s not a typo. That’s $1.7 trillion. https://www.ihlservices.com/product-category/research-papers-webinars/

Think about that for a moment. All the AI, all the automation, all the brilliant technology we’ve been talking about—none of it matters if a customer walks into your store looking for the one product they came for, and it’s not there.

This is why shelf intelligence has become a competitive necessity, not a nice-to-have feature.

Shelf intelligence means understanding in real-time: What’s on the shelf? What should be on the shelf? Why isn’t it? Can I get it there before the customer notices it’s gone?

The retailers winning the on-demand race are not winning just because they have fast fulfillment. They’re winning because they have visibility into inventory that lets them act on demand signals before they become out-of-stocks.

This is the foundation. Everything else in retail rests on this.

Winning the On-Demand Race

With shelf intelligence as the foundation, retailers are now competing on speed of fulfillment.

Sweetgreen launched their first drive-through, calling it the Sweet Lane. It’s designed to connect their automated infinite kitchen technology directly to a super smooth, super fast pickup experience for digital orders. You order on the app, you drive through, and your meal is waiting. It’s a vertical integration of automation and speed.

ASDA in the UK just signed a multi-year deal with Uber Direct. They’re not building their own last-mile network. They’re tapping into Uber’s existing logistics infrastructure to move groceries, including big orders, to people’s homes at speed from way more locations than they could reach alone. This is strategic partnership thinking.

1-800-Flowers partnered with DoorDash. Here’s why this is brilliant: flowers were traditionally a planned purchase. You think ahead, you order in advance. But with DoorDash integration, it becomes an impulse purchase. “Oh no, I forgot my anniversary.” 30 minutes later, flowers arrive. That changes the psychology of the category and the addressable market.

The pattern: Speed isn’t just about logistics. It’s about changing how customers think about the category. See our research Adapt or Be Outpaced (free for download) for more detail.

Seamless Payments Are the Final Friction Point

When you can get the product to the customer fast, the last thing you want is friction at payment.

David Jones, an Australian department store, did something interesting with their loyalty program. For the first time, they gave customers a choice: Do you want store points, or do you want Qantas airline miles? It’s a small decision, but it puts control in the customer’s hands. That matters for engagement and retention and customers get to double dip on points just as if they were using an airline credit card for a flight.

HEB is expanding buy-now-pay-later options—Affirm, Afterpay, and others. This used to be a differentiator. Now it’s table stakes. Heading into the holidays, when budgets are tight and the government shutdown hurt most everyone directly or indirectly, giving customers more ways to manage how they pay directly impacts conversion.

Why Transformation Speed Matters Right Now

The reality check I want to leave you with this transformation is happening now, across every corner of retail.

I focus on what’s actually being deployed, not what’s theoretically possible or slideware. And what I’m seeing is over 40 significant stories every single week of retailers making moves like these in mainstream deployments

The retailers who keep up are the ones willing to make decisions and move now. The ones who wait for the technology to “mature” or the market to “stabilize” will find themselves behind. The question is: are you part of the wave, or are you being washed over by it?

The Question for Your Business

When you look at all this change—the speed from the factory floor to the customer’s doorstep—you have to ask yourself: Is your business keeping up?

Not “Will we eventually?” But right now, today, are you moving at the pace the market is moving?

Because that’s the difference between winning the next phase of retail and finding yourself playing catch-up for years.

For More Insight

Explore IHL Group’s latest research on retail technology adoption, shelf intelligence, and inventory management. We track what’s actually being deployed across retail segments, not what’s in beta or planned for someday.  Several free or paid research reports to choose from. 

Visit ihlservices.com to dive deeper into retail transformation, or explore the complete analysis in the latest episode of Retail Reality Check: