New Delhi: Despite growing consensus that artificial intelligence will define the next phase of competitiveness in retail, most companies have made limited progress in deploying AI at scale, according to a global study by Tata Consultancy Services (TCS).
The TCS Global Retail Outlook 2026, based on responses from over 800 senior retail executives across 18 countries, found that 85% of retailers have not yet begun implementing multi-agent AI systems, while only 24% currently use AI for autonomous decision-making. Instead, a majority remain focused on basic applications such as chatbots and virtual assistants.
About 51% of retailers cited chatbots and virtual assistants as their primary AI initiative, suggesting that AI adoption is largely confined to isolated customer-facing use cases rather than embedded across core business functions. The study said this limits the transformative potential of AI in areas such as supply chains, pricing and merchandising.
The report ranked AI-powered capabilities among the most critical priorities for retailers in 2026, second only to cost optimisation. Adaptive AI-driven decision-making and real-time sensing of market changes emerged as top strategic needs, reflecting the sector’s push to respond faster to shifts in consumer demand and competitive dynamics.
However, workforce readiness remains a key bottleneck. The study identified skills gaps as one of the biggest challenges, with only 33% of retailers viewing digital literacy programmes as central to organisational transformation and talent upskilling.
Data monetisation also remains underdeveloped. Only 37% of retailers use loyalty data to inform channel or store experience strategies, while 45% apply such insights to pricing and promotions, pointing to missed opportunities to unlock enterprise intelligence.
“Retailers today believe AI will define the next era of competitiveness, yet most have only scratched the surface of its potential,” said Krishnan Ramanujan, president, consumer business group at TCS, adding that the real opportunity lies in moving from isolated pilots to pervasive intelligence across the value chain.
The study argues that retailers must shift toward what TCS calls “perceptive retail”, where AI, machine learning and connected systems enable organisations to sense, learn and respond in real time. As competition intensifies and margins remain under pressure, the report suggests that the pace at which retailers scale AI adoption could become a decisive differentiator in the years ahead.