AI as a driver of innovation in retail

When artificial intelligence provides inspiration instead of just optimization

06.03.2025

by Jennifer Meyer

A new study shows: If AI can do more than just sort data, it will not only change the retail sector, but also the role of employees.

It has long been a truism: machines do the routines, humans contribute the creativity. But as artificial intelligence (AI) becomes more widespread, these boundaries are becoming blurred. In retail – a sector that is strongly driven by efficiency, speed and cost pressure – AI is often seen as a means of automating stock management, customer inquiries and pricing strategies. But what impact does AI actually have on the people who work here? A new study sheds light on the extent to which AI not only optimizes processes, but also promotes creativity and increases job satisfaction.

A team from Florida Atlantic University and Hanyang University in Seoul investigated how the quality of AI services influences the innovative power of retail employees. The focus was not only on technical factors such as reliability and transparency, but also on the interpersonal qualities of AI – such as its responsiveness and empathy.

Empathic AI as a driver for innovation

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The results of the study, published in the Journal of Retailing and Consumer Services, are striking: Employees who perceive their interaction with AI as useful develop a greater willingness to innovate. Especially when the system not only works precisely, but also simulates “human” qualities such as empathy.

“Empathy in AI fosters trust and deeper connections, encouraging employees to engage in innovative behavior by making them feel supported,” says Sangbeak Ye, one of the authors of the study. “Employees who actively engage in innovative behavior feel more aligned with their roles because they can tailor their tasks to match their strengths and aspirations.”

This contradicts common perceptions: AI is often feared as a cold, calculating technology that replaces jobs. But this shows a different perspective – one in which AI increases creative freedom instead of restricting it.

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Should AI do more “listening” instead of just executing?

What is particularly interesting is that not all technical features of AI systems have the same influence on the willingness to innovate. While reliability – i.e. consistent, error-free performance – is considered essential, transparency had no significant influence. The fact that employees can understand exactly how an algorithm arrives at decisions therefore seems to be less decisive than the question of whether they trust the system. Responsiveness, often seen as the key to good customer service, also played a lesser role in the study.

Instead, empathy proved to be particularly effective. AI that not only “responds” but also understands the emotional and psychological needs of users creates an environment that favors innovation.

Retail between automation and humanity

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There is a clear implication for companies: those who view AI merely as a means of increasing efficiency are wasting potential. “Our research highlights the importance for managers to create work environments that promote innovation by enhancing AI service quality,” says Ye. ”Focusing on reliability ensures AI can dependably assist with daily tasks, while boosting empathy in AI systems leads to more personalized and emotionally resonant experiences, inspiring employees to pursue new ideas.”

Especially in a sector where working conditions are often considered challenging, this insight could be significant. Because if AI not only increases productivity but also enhances the role of employees, it could help to make the retail sector more attractive as a working environment – and thus also improve service quality in the long term.

Practical examples: How retail companies are using AI successfully

A remarkable example of how AI is already supporting this transformation can be seen in practice today: German supermarket chain REWE has introduced a hyper-realistic avatar of management member Robert Zores to support new employees during onboarding. In addition to answering questions and transferring knowledge, the project focuses on natural communication, according to REWE.

Executive Vice Presidents Donna Morris and Cheryl Ainoa from Walmart also reported on LinkedIn that their employees felt more motivated and more involved in the innovation process thanks to the use of creative AI assistants and were happier as a result.

The diverse application of generative AI solutions in the retail industry shows that artificial intelligence does not replace the role of employees, but enhances it, and that both staff and the company can benefit. After all, AI is far more than just an automation tool: it can be a real driver of innovation – if it is used wisely. Solution providers are therefore called upon to develop applications that take the human aspects of work into account.

Source: Press release of Florida Atlantic University