MARKETINGARTIFICIALINTELLIGENCEINSTITUTEAl forRetail LeadersBLUEPRINTMOVABLE INKPUBLISHED 2024Marketing Artificial Intelligence,LLC 2024Table of ContentsThe Al Opportunity for Retail Leaders3Consider This Your Wake-Up Call3The Data Doesn't LieAl Understanding On The RiseAl Usage Is On The Rise,TooLeaders Are Focused on Tangible Use CasesThey're Largely Optimistic About Al's Potential and ImpactAnd Al Is Already Producing ResultsBut Barriers ExistWhat Should Retail Leaders Do About It?The Top Use Cases for Retail LeadersEmailContent and CreativeSocial MediaAdvertisingPersonalization and RecommendationThe Top Tools for Al for Retail LeadersDa Vinci from Movable InkChatGPT,Claude from Anthropic,and Google GeminiWriterCeltraAmazon PersonalizeHow Retail Brands Get Results from AlVictoria's SecretLands'EndWhat's Next?About Movable InkAbout Marketing Al InstituteAI FOR RETAIL LEADERS BLUEPRINTThe Al Opportunity for Retail LeadersConsider This Your Wake Up CallRetail leaders,consider this your wake-up call:Artificial intelligence is changing business as usual in every aspect of retail.And there'snever been more pressure from executives,investors,and boards to build a smartercompany and team using Al.Yet not nearly enough retail leaders fully understand how Al is going to disrupt andtransform their business,their marketing,and their teams.(And even fewer of them fullyunderstand exactly how to actually make Al work for them.)But the ones who do are positioned to win big.Today,forward-thinking retail leaders are already capturing massive productivity andperformance gains using Al.They're also evolving their companies and careers tobecome far more intelligent,predictive,and data-driven,thanks to the formidablecapabilities offered by today's Al technology.In fact,top brands like Victoria's Secret and Lands'End are already using Al to do thingslike:Significantly boost email click-through rates,conversion rates,and revenue persend..Dramatically improve efficiency and revenue growth across retail operations...And hyper-personalize customer-facing communications to display the rightmessage at the right time.In short,the retail leaders who get it are actively giving themselves superpowers byapplying the right Al to the right use cases in the right way.This guide will show you how to do just that.In it,you'll find never-before-seen data onhow marketing and retail leaders are using Al,as well as concrete use cases,tools,andadvice you can use to begin seeing results with Al.AI FOR RETAIL LEADERS BLUEPRINTWe know that what's inside this guide works-because we've done this before.You'lllearn that,unsurprisingly,adopting Al in your marketing is not optional-it's a mandate;that while generative Al applications are creating efficiencies,uses in machine learningto drive increased personalization are where CMOs are prioritizing;and that Alintegration can't wait;it needs to happen now.With an abundance of experience helping retailers,the team at Movable Ink are Alexperts building the Al-native personalization solution of the future.And,the team atMarketing Al Institute has been helping marketing and business leaders across allindustries and sectors (including retail)understand,pilot,and scale Al since 2016.So if you're ready to get serious about applying Al to retail,you've come to the rightpeople and the right place.Let's dive in.The Data Doesn't LieThe data doesn't lie:Al is big business for marketers and retail leaders.This year,Movable Ink collected data on Al usage from more than 300 marketing leadersat medium and large firms,with the largest cohort of respondents representing retailleaders.These 300+leaders were asked dozens of questions about how they use Al andwhat tangible business outcomes they're achieving with the technology.Together,their responses give us never-before-seen data on exactly how marketing andretail leaders are actually approaching and adopting Al.And there's plenty you can learnfrom the key takeaways.AI FOR RETAIL LEADERS BLUEPRINTAl Understanding Is On The RiseMovable Ink first asked leaders to rate their Al literacy.The majority(53%)said they had anIntermediate understanding of Al,which meant they knew how Al could be used for tasks likepersonalization and optimization but were not deeply familiar with how to execute thesetasks.14%of them said they had an Expert understanding.That left just 26%saying they have a Beginner understanding of Al,meaning they understandsome basic Al concepts and generally how marketers use Al.When we drill into retail leaders specifically,they're even more sophisticated than the average.62%say they've got an Intermediate understanding;only 23%say they've got a Beginnerunderstanding.Across all cohorts,leaders at companies with between 500-749 employees are most likely tosay they're Beginner level(32%),while those at companies with 750-999 are most likely to beExpert (18%).How would you rate your Al literacy on scale from 1 to 4(1 being no knowledge whatsoever and 4 being an Al expert)6%26%53%14%VERY LIMITEDBEGINNERINTERMEDIATEEXPERT UNDERSTANDINGUNDERSTANDING(I understand some basic(I know how Al can be(I have extensive(I have heard of Al inconcepts of Al and have aused for tasks likeknowledge of Almarketing but do not knowgeneral idea of marketerspersonalization and adtechnologies and theirhow it works or how it canuse them)optimization but I'm notapplications in marketingbe applied to mydeeply familiar with how toand am often called uponmarketing strategies)execute them)for my expertise)Al Usage Is On The Rise,TooAl literacy among retailleaders is improving,butWhen asked how often they use Al tools in their work,28%there is still a gap.Theof respondents say they use Al tools daily,and 46%say theycompanies that test anduse them several times a week,totaling 74%weekly.embrace solutions to bridgeBreaking this down further and look at just retail leaders,this gap the fastest will leadthey're also above average in usage:34%say they use Altheir peers in Al-poweredtools daily,and 48%report using them several times a week.transformation.5AI FOR RETAIL LEADERS BLUEPRINTUsage differs a bit by firm size,too.Firms with 250-499 employees have the lowest proportionof daily users at 18%,while firms with 1,500+employees have the most at 39%.Firms with 750-999 employees are most likely to say they're using tools several times per week(64%).Among retail leaders,the biggest firms are also the ones using Al the most,with 48%of retailleaders at firms with 1,500+employees saying they use Al daily.62%of retail leaders at firmswith 1,000-1,499 employees say they use Al several times a week.Also,when asked how much their teams are using Al in their marketing program,44%say theirusage was Extensive and 12%say they have Full Integration of Al into their marketing program.Retail is also ahead of the pack here.A full 58%of retail leaders said their teams'usage of Alwas Extensive and 15%said they had achieved Full Integration.Leaders Are Focused on Tangible Use CasesAl usage is the norm,When asked what types of Al they already used or wereespecially in retail,whereplanning to use for work,60%said they were using ordaily use is highest amongplanning to use generative Al(AI that creates new content,larger firms.Al adoption issuch as text,images,or music,based on patterns learnedhappening now,whetherfrom existing data).you know it or not.What types of Al are you currently or planning to use for work?(Select all that apply)GENERATIVE60%(Al that creates new content,such as text,images,or music,based on patternslearned from existing data)PREDICTION50%(Al that forecasts future outcomes based on historical data,such as sales forecasts orcustomer behavior predictions)45%VISION(AI that processes and interprets visual information from the world.like images andvideos,to recognize objects,faces,or scenes)DEEP LEARNING43%(A subset of machine learning that uses neural networks with many layers to analyzecomplex data patterns,often used in image and speech recognition)NATURAL LANGUAGE PROCESSING44%(Al that understands,interprets,and generates human language,enabling interactionsthrough text or speech,like chatbots or language translation)4%NONENo current or future plans to use Al2%NOT SUREAI FOR RETAIL LEADERS BLUEPRINTWithin generative Al,78%of respondents said they use Al today to create copy and 68%use itto create imagery.When it comes to Al for copy,retail is using it more than the averagerespondent,with 86%of retail leaders saying they use Al for copy.Interestingly,85%ofrespondents who say they work at agencies(which may be supporting,in part,retail clients)also say they're using it for copy.When it comes to Al for imagery,the story is similar:80%of retail leaders are using Al forimagery and 81%of agencies are doing the same.Retailers are laser-focusedOut of all respondents,50%said they were also using orplanning to use prediction Al,or Al that forecasts futureon practical Al applicationsoutcomes based on historical data,such as sales forecastslike personalization,or customer behavior predictions.content creation,andsmarter recommendations.Respondents were also asked how they were using AlThese uses are no longerspecifically to personalize campaigns today.The highesttheoretical-they're activelyproportion(55%)say they use Al for content personalization.being used to improve(For example,making a decision on the most relevantcustomer experiences andcontent to show each customer.)The second-highestdrive positive revenueproportion(50%)say they're actively using Al for productimpact.recommendations.How do you use Al to personalize campaigns today?(Select all that apply)50%55%45%40%44%9%SEGMENTEDPRODUCTNEXT BEST ACTIONCUSTOMER JOURNEYCONTENTNONEPERSONALIZATIONRECOMMENDATIONS(e.g,share the nextMAPPINGPERSONALIZATIONI don't use Al for(e.g.,use Al to(e.g,show productsbest service or offer(e.g,optimizes(e.g.,decision on thepersonalizationdetect/createyou might like basedbased on businesstouchpoints andmost relevantsegments)on past behavior)priorities andtriggers based oncontent to show tocustomer actions)customereach customer）.characteristics)AI FOR RETAIL LEADERS BLUEPRINTThey're Largely Optimistic About Al's Potential and ImpactGiven that respondents are often actively using Al,they're largely optimistic about what Al isalready doing for them-or what outcomes it will enable in the near future.When asked about how they envision Al impacting marketing resource needs in the future,themajority(59%)say it will enhance workforce efficiency.That means they believe Al will augmentteam capabilities,enabling fewer people to achieve greater productivity and better outcomes.When asked where they see Al having the most impact onthe company's bottom line,the majority(also 59%)say it willcreate operational efficiency,which means Al will streamlineCompared to their peers,processes and reduce costs.retail CMOs aremoving faster to adopt AlAnd it's not just about cost savings.When asked if theyin ways that are havingbelieve Al will be able to deliver more personalizeda direct impactcustomer experiences,86%of respondents said "yes."Retailon their bottom lines.leaders as a cohort are even more confident,with 88%saying they believe Al will be able to do this.Where do you see Al having the most business impact to your company's bottom line?(Select all that apply)CUSTOMER ACQUISITION AND RETENTION:42%Al will help attract new customers and retain existing ones through personalizedmarketing and enhanced customer experiences.OPERATIONAL EFFICIENCY:59%Al will streamline processes and reduce costs by automating routine tasks andimproving workflow efficiency54%REVENUE GROWTH:Al will drive revenue growth by optimizing pricing strategies,identifying upsell andcross-sell opportunities,and enhancing sales forecasting.PRODUCT AND SERVICE INNOVATION:50%Al will enable the development of new products and services by analyzing markettrends and customer feedback.RISK MANAGEMENT AND FRAUD DETECTION:26%Al will help minimize financial losses by identifying and mitigating risks,detectingfraud,and ensuring compliance with regulations.2%NOT SUREAI FOR RETAIL LEADERS BLUEPRINTAnd Al Is Already Producing ResultsLeaders aren't just optimistic about the future.They're seeing real results-right now.When asked how Al has impacted the effectiveness of their marketing campaigns,26%say it hasalready been Very Impactful.Another 48%say it has already been Somewhat Impactful.Thisindicates that 74%of respondents are already seeing significant results from Al.Retail leaders are above average when it comes to seeing results from Al.29%say it has alreadybeen Very Impactful,and 54%say it has been Somewhat Impactful.How has Al impacted the effectiveness of your marketing campaigns(e.g.increased click-through rates,conversion,and revenue)4%1%7%NO IMPACTLITTLE IMPACT26%14%3NEUTRAL IMPACTSOMEWHAT IMPACTFUL48%5VERY IMPACTFULN/ADON'T KNOW OR DON'T USE AIBut Barriers ExistSo far,the majority of respondents are actively using Al,believe it will improve their results andare already achieving initially promising outcomes.But that doesn't mean there aren't obstaclesin their way.When asked about the challenges they face integrating Al,51%of respondents,the highestproportion,say the high cost of tools and platforms is their biggest obstacle.Frequently,findingfunds for Al investments comes at the expense of existing investments vs.a new budget lineitem.9AI FOR RETAIL LEADERS BLUEPRINTOther common barriers include difficulty integrating Al tools(44%),lack of understanding orknowledge about Al(38%),and lack of measurable results from Al initiatives (35%).What challenges have you faced in integrating Al into your marketing processes?(Select all that apply)Lack ofHigh costsLimitingLack ofunderstandingof Al toolscorporatemeasurableor knowledgeandpolicyresults fromabout AlplatformsAl initiatives3%38%44%51%26%22%28%35%ResistanceStruggle withNot sureintegrating Alfrom teaminternal buy intools withmembersand approvalexisting systemsAl isn't cheap,and many companiesdon't have excess budgetto allocate for investments in Al.Difficulty in integrationand lack of understandingfurther compound difficultiesin funding Al transformation.CMOs must not only fightthese budgeting discussions,but also find tools thatactually drivetangible value.10AI FOR RETAIL LEADERS BLUEPRINTWhat Should Retail Leaders Do About It?Remember we said this was a wake-up call for retail leaders?The data confirms it:Al is creating massive opportunities for retail leaders and marketers atlarge.And the future of the technology is bright,with the majority deeply confident in its abilityto not only dramatically increase productivity,but also performance and personalization.Yet it's clear we still face hurdles to Al adoption for retail leaders.This is why we advocate thatretail leaders take the following steps immediately to give themselves,their teams,and theircompanies the best possible chance to successfully adopt and scale Al.1.Urgently pursue company-wide Al literacy.In the data,we found that the highest proportion of respondents(64%)believe the most criticalskill for marketers to succeed in the age of Al is proficiency in Al tools.The second-highestproportion(57%)say strategic thinking will be the most critical skill.Neither happens without widespread Al literacy across your company.Al is not just for a selectgroup of leaders or technologists within your company.It impacts every single role,no matterthe function,title,or level of seniority.To succeed,every member of your teammust have at least a baseline understandingof what Al can do and howthey can use Al to improve their work.Al impacts every single role,no matter the function,title,or level of seniority11AI FOR RETAIL LEADERS BLUEPRINT2.Urgently understand AI's impact on jobs.Many responses in our data show that respondents are using Al to achieve significantoperational efficiencies.This is a good thing.However,it will impact existing roles and thedistribution of labor within firms.In fact,51%of respondents say Al has already shifted roles in their company towards thosethat are oriented towards strategic planning.48%say Al has given them an increased focus ondata-driven decision-making.And 51%say Al has already reduced time spent on repetitivetasks.These numbers point to a larger truth:Al is having a large impact on how many hours it takesexisting teams to do many tasks,which raises questions about how human capital should beallocated.And Al is causing a shift towards different skills than those possessed by existingroles and employees.Every retail leader should be asking themselves:Are we prepared for thisshift?And are we adequately staffed for it?How has the adoption of Al impacted the roles and responsibilities within your marketing team?(Select all that apply)4%2%48%51%51%50%No ImpactShifted rolesReduced timeEnhancedNo significantNot sureon data-driventoward morespent oncollaborationchange indecision-makingstrategic planningrepetitive taskswith technicalroles andteamsresponsibilities3.Urgently identify use cases and adopt tools.Pursuing Al literacy and determining Al's impact on jobs within your company are critical steps,but they don't happen overnight.But that doesn't mean you can't make progress with Alstarting right now.One of the best short-term courses of action to take while you solve long-term strategicconsiderations is to identify the use cases and tools that can move the needle the most in yourrole,team,and/or organization.The rest of this blueprint will help you do precisely that.12AI FOR RETAIL LEADERS BLUEPRINTThe Top Al Use Cases for Retail LeadersSo,how can you or your team actually use Al Content and Creativein your retail work?Al today excels at generating and iterating oncontent and creative assets to powerThere are literally hundreds of ways.But we've smarter,more engaging retail campaigns.pulled together some of the best,highest-Using Al right now,you can:value ones based on our unique expertise inbuilding Al for retail and helping retailersCreate and edit imagery for content andsucceed with Al.creative at a professional level.EmailGenerate hundreds or thousands ofIt's convenient that you can't spell "Email"content and creative ideas in minutes.without"AI"because today's Al capabilitieshave tons of valuable applications in retailGenerate hundreds or thousands ofemail campaigns.Today,Al can help retailiterations from a single assetleaders do the following:automatically.Analyze email performance at scale andLocalize and scale content and creative torecommend strategic improvements.different languages,locations,andaudiences.Create subject lines for emails thatoutperform human copywriters,and A/BWrite retail copy and content at a hightest these subject lines at scale.level of competency in the voice,tone,and style of your brand.Create nearly limitless variations of emailcreative and content to appeal to,test,andvalidate email approaches.Hyper-personalize emails at an individuallevel to each unique customer or recipient.Optimize email send times to match emailsends with the times individualsubscribers are actually active andopening emails.13AI FOR RETAIL LEADERS BLUEPRINTSocial MediaLet's not forget social media.Forward-thinkingMonitor and analyze competitor ads tosocial media professionals in retail are alreadydeconstruct their strategy.using Al to:Optimize ads and budget to maximizeAutomatically generate social mediaconversions with limited or no humancontent calendars and plans.involvement.Automatically generate social media postsPersonalization/Recommendationsfrom scratch or by repurposing existingThanks to Al,we can now hyper-personalizecontent.and scale messages and recommendations toCreate short-form video clips automaticallycustomers.That should be music to any retailfrom long-form video.leader's ears (especially since recent researchfrom Dentsu shows that personalization is amassive priority for CMOs right now).Extract valuable consumer insights fromsocial trends and conversation data.Here are some ways Al makes that happen:Personalize social media messages withAnalyze and segment customers at athe right message for the right person atthe right time to drive conversions.granular level based on demographics,purchase history,and more.AdvertisingContinuously adapt messages and offers toWant to create and optimize ads that performbetter and cost less?Al is here to help.Using Alre-engage dormant contacts.today,retail leaders can:Discover and suggest new products thatalign with unique tastes,motivations,andCreate and test hundreds or thousands ofvariations of ad landing pages to maximizepreferences.conversions.Dynamically adjust web and mobile contentto match customer preferences.Forecast ad copy and creative effectivenessbefore you launch.Hyper-personalize content and productrecommendations to individual customers.Generate ad copy and creative at scale inseconds.14AI FOR RETAIL LEADERS BLUEPRINTThe Top Al Tools for Retail LeadersWhich Al tools can you rely on to move the needle in your retail operations?Here are a few ofthe leading vendors to explore.MOVABLEINKDa Vinci from Movable InkDa Vinci from Movable Ink is an Al-native personalization solution that curates content foreach customer across batch email programs,leading to stronger customer relationships andlifts in clicks,conversions,and revenue.It does that by anticipating customer interests and delivering personalized content to eachsubscriber with every email.Not to mention,it's integrated right into a brand's existing ESP,soit also optimizes the timing and frequency of messages to enhance engagement and minimizefatigue.Da Vinci doesn't just show customers what they already know and like-it helps them discovernew products aligned with their unique tastes,motivations,and preferences.It'll even nativelyintroduce new products that extract more value from email lists while continuously adaptingto re-engage dormant subscribers.Da Vinci also offers Creative IQ,which helps you understand exactly what to talk to yourcustomers about by understanding the creative elements in every one of your assets andoptimizing the content,with minimal to no training needed.That helps you deliver the verybest content to every single customer with each and every send.In fact,Da Vinci goes way beyond today's generative Al,using a range of cutting-edgepredictive Al models and techniques to deliver superior performance.(And it's especiallyimportant that Da Vinci uses proven,profitable Al given the struggles many current generativeAL products have actually having economic impact.)As a result,Da Vinci has powered anaverage 20%conversion lift,a 27%increase in revenue,and a 40%productivity increaseacross customers.Learn More About Da Vinci15AI FOR RETAIL LEADERS BLUEPRINT