Will agentic AI change luxury retail?

Overcoming Challenges and Embracing the Future

AI is also shaping creativity in luxury in a positive way: AI generative platforms such as Stable Diffusion and Midjourney are increasingly being utilized by fashion designers; and last October’s Moncler x Lucy Li collaboration saw the Chinese artist team up with the Italian ski-jacket maker to turn her AI-designed clothes into real-life, ready-to-wear apparel. Fashion forecasters regularly use real-time datasets – gleaned from in-store sales and social media posts – to detect patterns and predict trends. This is a much quicker way of working out what people will be wearing in the coming seasons than relying on qualitative methods such as monitoring runway shows and street fashion.

Other uses for Agentic AI include image analysis to identify counterfeit products and tackle scammers. Burberry, for example, uses machine learning to scan product images and detect counterfeit items, helping to combat a luxury counterfeit market worth an estimated $4.2 trillion globally.

Being able to predict consumer behavior and buying habits is another good reason for brands to use AI. If luxury labels can understand their customers better and tailor products and bespoke services to them, this can help drive revenue, in a market that, according to a 2024 report from Statista, could already reach $500 billion by 2027.

At Cegid Pulse, we have our own set of generative AI agents, used by several companies to analyze customer data including purchase history and size/colour preferences. This means that when a customer visits a store, assistants can quickly check this data on a dashboard before offering personalized advice and suggestions while engaging with the customer.

This also extends to translating languages when customers from other countries visit retail stores. As well as instantly pulling up their datasets, Cegid Pulse can detect the language these shoppers are speaking before translating the assistant’s advice and recommendations.

And all of which makes excellent business sense: a report by Gartner suggests companies who’ve invested in AI for customer experience have seen a 25% increase in customer satisfaction scores. And yet… a recent report by global consulting firm Bain & Company revealed that many companies are yet to adopt the technology – 60% of luxury firms said the main barrier for entry is a lack of expertise and training in analytical AI, while 30% expressed concerns over security and compliance for using such advanced software. Nevertheless, Bain & Company also found more than 60% of companies see generative AI as a top-three priority.