AI has transformed retail and consumer goods (CPG) operations, improving customer analytics and segmentation to enable greater personalization in marketing and advertising, and increasing the speed and accuracy of demand forecasting for supply chains and logistics.
Companies are also raising the bar on customer engagement with intelligent digital shopping assistants and enriching catalogs by dynamically enhancing and localizing product information. AI Agents increase the speed and efficiency of operations, while Physical AI systems help streamline and automate warehouse and supply chain operations.
The Third Annual NVIDIA State of AI in Consumer Goods and Retail The survey report, which collected hundreds of responses, showed the maturation of AI within the industry as companies move AI projects from pilot to production across all domains.
Highlights from this year’s report include:
- 91% of respondents said their company is actively using or evaluating AI.
- 90% said they would build on the success of current projects by increasing their AI budgets in 2026.
- 89% of respondents said AI helps increase annual revenue, while 95% said it helps reduce annual costs.
- 79% said open source models and software were moderately to extremely important to their AI strategy.
- 47% said their company was using or evaluating agentic AI in its operations.
Learn more about some of the report’s key findings below.
Open Source opens up opportunities
Open source has quickly become the foundation of many retail AI systems, giving teams the flexibility to adapt models to their data and use cases while maintaining strong governance. Open and interoperable ecosystems also make it easier to integrate AI into existing tools and workflows, helping retailers scale innovation quickly.
“Most retailers have started experimenting with AI by using proprietary AI vendors,” said Jason Goldberg, director of commerce strategy at Publicis Groupe. “They had the models, but they didn’t have the keys to their own kingdom. Open source flips this scenario, allowing retailers to leverage their proprietary data, avoid vendor lock-in, and benefit from the innovation of the open source community.”
AI unlocks significant business impact
With 91% of respondents saying their company is actively using or evaluating AI, the question of competition in retail and CPG has shifted from whether or not to invest in AI to how to deploy and scale AI most effectively.
Across the industry, the business impact of AI has been tangible and significant. When asked how AI had improved their business, 54% cited improved employee productivity; 52% said AI helped create operational efficiencies; and 41% reported improved customer service.
As noted above, 89% of respondents said AI has helped increase revenue. For many businesses, this increase has been significant, with 30% reporting their revenue increased by more than 10%. The story is the same for AI’s role in reducing annual costs, with 95% of respondents saying AI has reduced costs and 37% saying costs have been reduced by more than 10%.
“What leaders should be focusing on is not greenlighting vanity projects at the expense of high-ROI wins,” said Chris Walton, co-CEO of Omni Talk. “Successful retailers will start with boring use cases that solve specific P&L problems, prove value, and then scale.”
Investments in AI, including infrastructure, hiring of AI experts and software, will increase next year, according to nine in ten respondents. And half of those surveyed said the increase could be significant, with budgets increasing by 10% or more year over year.
Agentic AI Makes Big Debut in Retail
The retail and FMCG industry is testing AI agents across all industries.
Overall, 47% of respondents said they were using or evaluating agentic AI. 20% of them say that AI agents are already active in their organization and another 21% will come in the next year.
“The truly disruptive impact of agentic AI will first hit supply chains and retail operations, such as autonomous agents managing real-time inventory rebalancing, dynamic pricing and supplier negotiations at scale, because this is where ROI is measurable,” Walton said.
Respondents identified three clear goals for agentic AI in retail and FMCG:
- Increased process speed and efficiency, according to 57% of respondents.
- Improved customer experience and personalization, by 40%.
- Improved decision-making with real-time data, for 40%.
Broadly speaking, agentic AI will be spread across three operational lines: internal operations, employee and customer support, and customer engagement. For example, in customer engagement, agents go beyond analytics and act on real-time insights, adjusting messages, recommending products, and guiding purchasing decisions based on customers’ individual contexts.
AI ensures supply chain resilience
Retail and FMCG have faced intense supply chain challenges this decade, and these challenges are only becoming more complex. Sixty-four percent of respondents in this year’s survey reported increasing supply chain challenges year over year, such as geopolitical instability, labor constraints, changing consumer expectations for speed and transparency, and regulatory complexity in global operations.
“AI allows retailers to optimize inventory at the store and customer level rather than regionally,” Goldberg said. “AI allows retailers to incorporate many more factors into their demand forecasts, and predict and avoid stock-outs much more accurately, by matching supply to demand much more precisely. »
The industry is turning to AI to streamline operations and resolve complexity. The higher pressure valve uses AI for operational efficiency and supply chain throughput, according to 51% of respondents. Meeting customer expectations comes in second with 45%, and resolving traceability and transparency comes in third, with 38%.
Physical AI is gaining traction in the industry, with 17% of respondents using or evaluating the technology.
“The real transformation will come from AI making existing physical infrastructure smarter,” Walton said. “My favorite example is in-store robotics. With it you get better prices, better inventory, better management and better presentation quality.”
Early movers are demonstrating that, when thoughtfully integrated, physical AI systems deliver more than task automation, improving flexibility and throughput in response to workforce pressures and increasing logistical complexity.
Download the “State of AI in Retail and FMCG: Trends 2026» report for in-depth results and insights.
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