Artificial Intelligence in Retail Market Size, Industry Shares, Global Growth and Forecast Report, 2030

According to the latest market research study published by P&S Intelligence, the global artificial intelligence (AI) in retail market is poised for remarkable expansion, with revenues projected to soar from USD 6,712.9 million in 2024 to USD 36,462.5 million by 2030, reflecting a robust CAGR of 32.6%. This impressive growth is primarily attributed to the booming online retail sector, increased investment in AI technologies, and the rising emphasis on enhancing customer shopping experiences.

Retailers are rapidly adopting AI-driven solutions to optimize operations and meet evolving consumer demands. Governments worldwide are also fostering digital transformation through supportive policies, further propelling market growth. Additionally, AI is playing a pivotal role in streamlining inventory management, supply chain planning, and customer engagement-helping retailers improve ROI and operational efficiency. As e-commerce gains traction, technologies like visual search and AI-powered recommendation engines are redefining the way consumers interact with brands, making shopping more intuitive and personalized.

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Key Insights

The market is segmented by offering into solutions and services, with the solution category contributing approximately 75% of the revenue share in 2024. However, the services segment is expected to grow faster, driven by increasing demand for professional services in AI integration.
In terms of technology, machine learning holds the largest market share due to its extensive use in personalizing customer experiences. Natural language processing (NLP), with its ability to interpret human language and derive insights from customer interactions, is the fastest-growing segment, expected to grow at a CAGR of around 34% through 2030.

Regionally, North America dominates the market with an estimated 35% share in 2024, owing to advanced digital infrastructure, the dominance of major e-commerce players, and high consumer adoption of online shopping. Meanwhile, the Asia-Pacific region is expected to exhibit the fastest growth, fueled by rapid digitalization, urbanization, and a growing middle-class population.

Retailers are increasingly utilizing AI for multi-channel marketing by analyzing vast amounts of consumer data from in-store behaviors, email campaigns, and digital platforms. This data-driven approach enhances campaign targeting and customer engagement.

Visual search, voice-enabled shopping, and AI-based personalization are transforming how consumers discover products. AI enhances visual search capabilities by analyzing metadata and tracking trends, which improves product recommendations and boosts sales.

The growing e-retail industry is a key driver of AI adoption. Rising internet penetration, smartphone usage, and investments in logistics are making online shopping more accessible and convenient, prompting retailers to automate and personalize their services.

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The retail sector is witnessing a surge in IT spending, with Gartner forecasting global retail IT expenditures to reach USD 240 billion in the next two years. Over 40% of online retailers are planning to increase their IT investments in 2024.

Despite the positive outlook, a significant challenge remains-the shortage of skilled AI professionals. The growing demand for AI deployment and maintenance underscores the need for a digitally skilled workforce. However, the global job market is responding, with AI-related positions expected to reach two million by 2025.

The AI in retail market remains highly fragmented, with numerous international and local players competing through product innovations, partnerships, and acquisitions. The competitive landscape is fostering rapid innovation and creating new growth opportunities across regions.

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