The Path of Digital Transformation of Retail Industry

Abstract

The integration of digital technologies like big data, Artificial Intelligence (AI), and the Internet of Things (IoT) is driving a disruptive transformation within the global retail sector. This study examines the profound impact of AI on retail business models, focusing on its role in reshaping operational strategies and customer interactions. Utilizing a mixed-methods approach that combines literature analysis with comparative data analysis, this research quantitatively and qualitatively evaluates AI implementation across various retail domains, including personalized marketing, supply chain optimization, and customer service reconstruction. The findings indicate that AI significantly enhances operational efficiency by optimizing inventory management and reducing costs, while simultaneously revolutionizing customer experience through hyper-personalization. However, challenges such as data privacy concerns and employee adaptation present significant hurdles. This study concludes by proposing strategic recommendations for retailers to navigate these challenges, underscoring the critical role of AI in sustaining competitive advantage in the digital era. The research contributes to the existing body of knowledge by providing a holistic analysis of AI's impact mechanisms and offering practical insights for successful digital transformation.