A recent study by the IBM Institute for Business Value indicates a significant shift in focus among retail and consumer product executives towards artificial intelligence (AI). The report, titled "Embedding AI in Your Brand's DNA," suggests that spending on AI outside traditional IT operations could increase by 52% in the next year.
By 2025, companies plan to allocate an average of 3.32% of their revenue to AI, equating to $33.2 million annually for a $1 billion company. This investment will cover areas such as customer service, supply chain operations, talent acquisition, and marketing innovation.
The study highlights rapid adoption across enterprises, with 81% of surveyed executives and 96% of their teams already using AI to some extent. There is a desire to expand AI usage into more sophisticated applications like integrated business planning.
Executives expect that 31% of employees will need new skills to work with AI within the next year, rising to 45% over three years. Growth in AI use for personalized customer service responses is anticipated at 236%. Notably, human-AI collaboration is expected to account for 55% of these improvements.
Investment in ecosystem platforms is predicted to rise from 52% today to 89% within three years as companies seek to integrate AI capabilities with partners for enhanced innovation and efficiency.
Despite high claims of having clear AI governance frameworks by executives (87%), fewer than 25% have fully implemented tools to manage risks like bias and transparency.
"AI is no longer just a tool; it's a strategic imperative," said Dee Waddell from IBM. Companies are encouraged to embed AI across operations not only for productivity gains but also for brand relevance and trust.
The report stresses the importance of rethinking governance and reskilling strategies while aligning AI initiatives with brand priorities through partnerships and cross-functional collaboration.
IBM will highlight these insights at NRF'25, showcasing how technology enhances customer engagement and operational efficiency.
For further details and access to the full report, visit IBM's website.
