The state of AI maturity in retail

The retail industry is actively experimenting with and investing in AI. As a former chief digital officer and head of direct-to-consumer business at a leading retail brand, I understand the excitement and pressure from leadership to quickly demonstrate the value of AI.

The rapid pace of change poses difficulties for the industry. I experienced the challenges of prioritizing AI use cases, piloting solutions, and making governance and risk decisions. But I have full faith that retail will rise to the challenge. After all, change in retail is as constant as Black Friday sales.

To get a better understanding of the state of AI maturity in retail, ServiceNow, in partnership with Oxford Economics, surveyed 276 executives in retail organizations as part of the Enterprise AI Maturity Index. Let’s explore the findings.

Minding the gap

Retailers are undoubtedly embracing AI at scale, yet our data shows that maturity levels trail expectations. The average AI maturity score for retailers decreased from 44 in 2024 to 35 in 2025, illustrating that AI is advancing faster than organizations can keep up.

A notable 55% of retailers rolled out more than 100 enterprisewide AI use cases in the last year, showcasing AI’s widespread application across operations. Yet only 40% strongly agree they’re operating with a clear, shared vision that’s aligned to their business transformation goals.

Without a clear, aligned vision, organizations risk losing AI momentum, which can prevent them from delivering impactful results. Retailers must integrate AI strategies into broader business goals to foster alignment between technology investments and long-term success.

Talent and data governance

Why isn’t AI scaling faster in retail? One of the most pressing challenges identified in our study was talent. Retailers struggle to find the right skills for AI integration and to ensure their workforce is adequately trained to use AI tools for customer engagement, inventory management, and operational efficiency.

In fact, only 29% of retailers strongly agree they have the right mix of talent for AI adoption, according to our research. Retail executives must act quickly to develop their workforces by building robust training programs, attracting AI specialists, and prioritizing strategic hiring.

Talent isn’t the only missing link for retailers, however. Data governance, critical for scaling AI, is also underdeveloped in the sector. Only 47% of retailers report meaningful progress in formalizing governance.

Without a strong AI governance framework, experimentation may be stifled by operational inefficiency or create unintended risks as the use of AI expands across teams.

Agentic AI

Retailers using agentic AI solutions are reaping rewards. Agentic AI systems are designed to help foster operational efficiency, drive autonomous decision-making, and streamline workflows.

Agentic AI users in retail have improved gross margins at a significantly higher rate than non-adopters. Specifically, 55% of agentic AI users have seen gross margin improvements, compared to just 22% of non-users.

For retailers on the fence about the technology, this provides compelling evidence of the need to invest in advanced AI use cases—especially in today’s retail climate. Those that adopt agentic AI are solving business challenges faster and securing considerable return on investment in an increasingly competitive industry landscape.

The advancements in AI technology offer unprecedented opportunities for growth and innovation in the retail industry. As retailers continue to embrace these solutions, they’ll be well positioned to meet the evolving demands of consumers and stay ahead.

Find out how ServiceNow can help you put AI to work for retail.