Report: Amazon, Walmart and Stitch Fix lead the way in embracing AI

Amazon, Walmart, and Stitch Fix lead the way when it comes to embracing AI according to a new report that has ranked the 100 leading retailers and brands to use AI to drive impact across their organisations.

The inaugural report, The 2024 Retail AI Index, was developed by Lily AI, a technology platform specializing in AI solutions, in partnership with global analytics and strategy consultancy, Radii Group.

Among the key findings, the report shows that both Amazon (#1) and Walmart (#2) lead in AI adoption and continue to leverage substantial financial resources to invest in advanced AI technologies and talent.

No clear correlation exists between a retailer’s index rank and overall revenue, suggesting retail is still in nascent stages of AI integration and it is too early to see the full financial impact.

In third place, Stitch Fix stands out because they leverage several AI-based technologies to deliver personalised shopping, building on their original business model of tailored/recommended clothing bundles.

According to the researchers, Stitch Fix illustrates how mid-size companies can move toward significant AI adoption with focused investments that drive revenue and advance their mission while building on existing data and models.

Elsewhere, some companies with a higher AI adoption ranking have acquired or joined in strategic partnerships with AI firms, such as Wayfair’s (#5) acquisition of LLM startup ThirdAI and IKEA’s (#20) investment in Waaabi, a generative AI autonomous truck company.

Poshmark, another retailer with revenues of under $1 billion, came in at #18, having recently introduced an AI-powered tool called Promoted Closet which uses machine learning to match shoppers’ search terms with promoted listings. Not only does Promoted Closet seek to create a more enjoyable customer journey, but it also increases visibility and sales potential for sellers.

Delving Deeper than Financial Investments

Lily’s investigation delved deeper than financial investments to uncover which retailers had thoroughly embedded AI throughout their operations. The index reveals that numerous companies leverage a diverse array of AI technologies, including computer vision and generative AI, to enhance operational efficiency. These leading retailers and brands are also harnessing AI to bolster decision-making, boost sales through improved customer experiences, and optimize marketing initiatives. This multifaceted approach demonstrates how AI has become integral to various aspects of modern retail, from back-end processes to customer-facing interactions.

Speaking on the release of the report, Purva Gupta, Co-founder and CEO, Lily AI said: “AI continues to empower retail leaders to reshape and modernize the customer experience, and it’s critical for all retailers to understand where they stand.”

He added: “AI is becoming table stakes for retailers who want to stay competitive. Not surprisingly, the biggest of the bigs–Amazon and Walmart–have the resources to invest in AI extensively. But, as we found, even relatively smaller companies, such as Poshmark and Revolve, are taking highly innovative approaches and reaping the benefits.”

The top 10 retailers and brands in the AI index include:

1. Amazon
2. Walmart
3. Stitch Fix
4. eBay
5. Wayfair
6. Sam’s Club
7. Target
8. The Home Depot
9. Macy’s
10. Nike