Redefining Innovation Benchmarks:
Retailers show different innovation maturity levels based on their benchmarking approach. While 17% of U.S. and Canadian retailers see themselves as leaders against their retail peers, only 3% consider themselves leaders when compared to cross-industry leaders such as leading technology firms and digital retailers. In 2024, retailers will increasingly look to learn from innovation best practices from cross-industry leaders such as technology firms and digitally native brands.
Catalysts of Committed Leadership:
Leadership's role in innovation is crucial, with 65% of retailers in the U.S. and Canada stating their leadership is committed to innovation. Fifty-one percent of these firms maintain open communication channels, compared to 18% without committed leadership. Also, only 29% of committed leadership companies face resource constraints, compared to 56% for their non-committed counterparts. Retailers whose leadership is committed to investing in innovation will continue to build upon early successes, and we expect the maturity gap to expand further as the long tail of innovation investments begin to bear fruit.
The Transformational Role of Artificial Intelligence (AI):
AI is a key driver of retail's future, with 83% of North American and 67% of Latin American retailers scaling existing initiatives or exploring new investments. AI's varying applications, such as Machine Learning and Robotic Process Automation (RPA), are reshaping customer experiences and operations. 2024 is poised to witness a significant surge in AI adoption, with retailers leveraging their potential to transform customer experiences and streamline operations.
Generative AI: A New Frontier:
Though current adoption is low, generative AI is emerging as a captivating frontier for exploration, primarily in the U.S. and Canada. A notable 66% of North American retailers and 38% of Latin American retailers are actively exploring the possibilities of generative AI. Retailers will aggressively explore generative AI applications in 2024, particularly in customer service, personalized content, and promotions. However, not all exploratory interest is expected to translate into actual enterprise-level adoption, a common occurrence in technologies during their hype cycles.
Divergent Innovation Narratives in the U.S. & Canada vs LATAM:
The report uncovers different approaches to innovation, with the U.S. and Canada focusing on digital-physical unification and Latin America on ensuring existing innovation investments can be capitalized across multiple use-cases. These differing areas of focus underscore the importance of regional strategies in driving innovation tailored to specific market needs.
Abby Nelson(For Incisiv)