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August 25, 2025 5 mins

The retail experience is undergoing a quiet revolution. Remember when personalization simply meant seeing your name in an email? Those days are long gone. Today, artificial intelligence shapes virtually every aspect of how you shop—what products you see, what offers you receive, and sometimes even what prices you're quoted.

As a retail expert, I've witnessed firsthand how AI-powered personalization has become the industry's most powerful tool. Studies now show that effective AI personalization can boost conversion rates by double digits and significantly increase customer lifetime value. But the execution is delicate. When done right, customers feel understood and valued; when done poorly, the experience feels invasive or manipulative—potentially damaging customer relationships permanently.

What's fascinating is how multifaceted this technology has become. Beyond basic product recommendations, we're seeing dynamic website merchandising that reconfigures in real-time based on your preferences, conversational AI that guides purchase decisions, personalized pricing strategies, and in-store experiences enhanced through mobile notifications and smart displays. The most sophisticated implementations are becoming nearly invisible—you don't even notice you're receiving a personalized experience; it just feels intuitive. Looking ahead, the retailers who will thrive aren't necessarily those with the most data or advanced algorithms, but those who use these tools to respect customers' time, preferences, and privacy. At its core, successful personalization isn't about technology—it's about respect. Ready to pay more attention to how AI is shaping your next shopping experience? You might be surprised at what you discover.

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Transcript

Episode Transcript

Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Well, hello everyone, I'm Scott Benedict.
You know, if you walk into yourfavorite retail store or log on
to your favorite retail appthese days, think about this how
much of what I'm seeing isreally designed just for me.
Today, personalization is nolonger about just getting your
name right in an email althoughthat is important longer about

(00:26):
just getting your name right inan email, although that is
important.
It's about AI shaping what yousee, what you buy and even, in
some cases, how much you pay.
Today, I wanted to talk alittle bit about just how much
AI-powered personalization isimpacting the retail experience
that we consumers have Now.
Personalization has always beenretail's holy grail.
Merchants like me and marketershave long known that when a

(00:48):
customer feels understood, theytend to buy more and they tend
to stay loyal much longer.
But the challenge is alwaysscale.
You can't have a personalshopper for every customer.
That's where AI comes in Now.
Today, artificial intelligenceenables retailers to anticipate
needs, personalize promotionsand curate product selections in

(01:12):
ways that we could only haveimagined just a few years ago.
According to recent studies,ai-driven personalization can
lift conversion rates by doubledigits and drive customer
lifetime value significantlyhigher.
But, as with most things, thereis a catch.
While the promise is enormous,execution is tricky and getting

(01:34):
it right you will absolutelyearn a customer's trust and
loyalty, but get it wrong and ifit feels invasive or, worse,
creepy, you could scare off acustomer for some time to come.
So what does AI personalizationlook like today?
It manifests itself in a numberof ways from product

(01:56):
recommendations that are curatedbased on your purchases, your
browsing behavior, both onlineand in a store.
Those can drive the kinds ofproducts that a retailer
promotes to you.
That also manifests itself indynamic merchandising, where
retailer websites and apps areincreasingly reconfigured in

(02:18):
real time so that a home page ora category page or a
promotional page show yousomething different than they
might show me, based on ourindividual preferences.
Conversational AI or chatbotsthat don't just answer questions
in response to a question thatyou pose to it, but guide you

(02:39):
through the purchase process tomake the right product decision,
to anticipate your preferencesfor size or style or colors or
for the timing of a purchase.
Those are starting to becomemore commonplace with each
passing week.
Now, pricing and promotions orspecial discounts can also be
offered to a customer, eitherbased on their buying behavior

(03:01):
or because a retailer wants tomove through inventory, perhaps
at the end of the season or atthe end of a product's life
cycle.
Now it's also interesting thatpersonalization is not just
digital.
In physical stores, ai canpower personalized offers
through apps or messages thatcome up on your mobile phone, or

(03:26):
messages that come up on yourmobile phone through loyalty
programs, and now emergentincreasingly on smart screens or
electronic shelf labels rightthere in the retail store.
Now, for all these wonderfulinnovations, personalization is
not without its pitfalls.
Customers expect relevance, butthey also demand privacy.
Ai personalization can easilycross the line if retailers

(03:49):
aren't transparent about how acustomer's data is used.
There is also a risk ofreinforcing bias.
If algorithms only serve upwhat a customer has bought
before, they may never discoversomething new, and so, for
retailers, over-reliance on AIcan create blind spots if human

(04:10):
judgment and a merchant's eye,in my view, aren't part of the
mix as well.
Now, looking forward, we'll seemore and better and refined use
of AI in personalization goingforward.
Hyperpersonalization is becomingso good that it's almost

(04:30):
becoming invisible to a consumer, so it doesn't feel like
personalization.
It just feels like a reallycurated shopping experience,
powering the information thatstore associates have that help
them solve a customer's problemor challenge more proactively.
That will also become morecommonplace as we move forward.

(04:51):
I think one of the biggestthings is trust will be a
differentiator.
By that I mean retailers whouse data to help serve the
customer's need without beinginvasive in their privacy.
It feels like, at the end ofthe day, that's the retailers
and the brands that will win.
Personalization really is allabout respect respect for a

(05:12):
customer's time, for theirpreferences and also for their
privacy.
Ai can take the retail businessfurther than ever before, but
only if retailers use itresponsibly.
That's what I've been thinkingabout.
I'm Scott Benedict.
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