AI is transforming retail operations, with TD Cowen analysts identifying Walmart and Ulta Beauty among retailers leading the AI charge due to their data capabilities. With the help of AI, Walmart is dominating the grocery business and Ulta Beauty is focusing on personalization in selling beauty products. BJ's Wholesale Club and Costco Wholesale are also benefiting from how AI enhances demand forecasting, inventory management and customer engagement. Analysts stress the importance of integrating AI with loyalty programs and transparent practices to fully realize its potential and help win consumers' trust.

Best Buy is enhancing its holiday shopping experience for 2026 with innovative digital and in-store offerings, such as assisting customers in finding and purchasing gifts directly through ChatGPT. Additionally, the retailer is launching immersive Meta Lab spaces in select stores for hands-on exploration of AI glasses via personalized fittings and interactive demos and displays. Best Buy's approach highlights its focus on leveraging technology to enhance the customer shopping journey.

Moncler has opened its largest-ever flagship store on Fifth Avenue in New York City, coinciding with New York Fashion Week. The two-level store features exclusive products, interactive experiences and advanced technology, including a Virtual Dressing Room and an AI-powered Outerwear Guide. The AI tool gives shoppers a curated edit of up to 12 styles that reflect their personal needs, offering side-by-side product comparisons and AI-generated insights describing unique qualities of each design.

Chewy is focusing on customer engagement and pet health care as the pet market remains soft, with recurring revenue from Autoship accounting for 84.6% of net sales in the second quarter and the Chewy+ loyalty program encouraging higher order frequency and category shopping. The company recently introduced Kai, an AI-powered assistant capable of handling common customer requests and enabling self-service for about 30% of chats. Chewy has also deployed eight AI initiatives aimed at transforming customer signals into actionable insights, with the expectation of generating cost savings.

Instacart has introduced Cart Assistant, a white-label AI assistant for retailers, and Clementine, an AI grocery shopping assistant for Instacart users. Cart Assistant allows retailers to offer personalized shopping experiences, including finding deals and building carts from photos. Clementine processes conversational requests, such as meal planning or reordering favorites, and converts them into tailored digital shopping carts, drawing on Instacart's robust data infrastructure for accuracy and personalization.

Meta's AI shopping assistant faces consumer trust issues Meta has introduced Muse, a personal AI agent that can shop on behalf of users by leveraging years of social activity data, joining a trend seen with similar AI tools from Amazon, Google and other companies. Muse can search for products, navigate checkout and pay through Stripe's Link service. A Vogue Business survey indicates that only 31% of consumers are willing to outsource shopping to AI, with significant concerns about privacy and data sharing.

Young consumers are turning to family and friends for fashion advice instead of influencers or AI, according to Pacsun's annual Youth Report, which describes them as the "Drawbridge Generation." The survey of people ages 11 to 24 finds 11% trust influencers for purchase decisions and only 2% trust AI for fashion suggestions. However, even though this generation has reservations about AI, 85% have used it in the past 12 months and 74% consider using it for shopping discoveries.

AI is playing a larger role in shopping decisions, with 67% of consumers trusting AI recommendations over social media influencers when exploring unfamiliar brands, according to a Contentsquare survey. However, 97% of consumers reconsider a purchase if an AI recommendation leads to a disappointing experience. Additionally, 36% of consumers have used AI to replace traditional search engines when shopping, primarily to find deals and compare products.