Retail Technology: Artificial Intelligence

The personalisation experience can be further augmented through the use of virtual shopping assistants to provide personalised recommendations and guidance. Image from rawpixel.com.

used to train generative AI models with the potential that such information might be abused.

Bias and discrimination:

AI algorithms can, in theory, inadvertently perpetuate biases present in the training data. For example, the training data might contain biases related to race, gender or other protected characteristics, with the result that the tool may produce biased outputs. Retailers must be alert to this risk and implement human oversight to better manage the possibility of harmful or offensive content being disseminated.

Security risks:

As generative AI tools become more sophisticated, so too do the risk opportunities for abuse by malicious actors, using them to create convincing fake content, such as counterfeit products or personalised offerings to customers, false advertisements and deepfake videos. Retailers will need to be vigilant in their detection and mitigation of the risks so as to protect brand reputation and maintain consumer trust.

Intellectual property:

A frequently voiced concern is that generative AI poses a threat to human generated IP and that it may also have a detrimental impact on the creative industries, which was a fact recently recognised by the UK government in scrapping the proposed text and data mining exemption to copyright law. As the Liberal Democrat MP Sarah Olney said in the UK Parliament, “We cannot let AI

If utilised properly, AI can help to better understand customer preferences and help them navigate through product catalogues, all of which are designed to improve the shopping experience. replace the human creators who have built our world-leading creative industry, nor can AI content be produced off the backs of hard-working creatives without their consent.”

Customer privacy:

Because generative AI relies on vast amounts of data to learn and create content, retailers must handle customer data responsibly and ensure compliance with data protection laws. Transparent policies regarding data collection, storage and usage should always be implemented to address concerns and generate trust.

Employment concerns:

The automation capabilities of generative AI may also lead to concerns about job replacement in the retail sector. As AI tools begin to handle tasks traditionally performed by humans, there is a potential impact on employment. Retailers need to be careful in their management of this transition, retraining and upskilling their workforce to adapt to new roles and leveraging AI as a tool to enhance human productivity rather than replace it.

About the author

FOR further information on this topic please contact Mathew Forde, Partner at Lewis Silkin Ireland specialising in intellectual property, media and dispute resolution (Mathew.Forde@lewissilkin. com). This article is for general guidance and does not constitute legal advice. Legal advice should be sought in any given set of circumstances.

Environmental risks:

Any large-scale deployment of generative AI systems will require significantly greater computing power than that engaged by today’s AI tools. The energy consumption associated with training and running deep learning models will be substantial. It will, therefore, be crucial that retailers explore energy-efficient hardware options and sustainable computing solutions to mitigate the environmental impact.

Conclusion

AI offers exciting opportunities for retailers and consumers alike, but retailers also need to address the associated risks and challenges posed to brand reputation. Retailers will need to navigate ethical concerns and biases, protect consumer privacy and safeguard against security threats. By striking the right balance between harnessing the potential power of the AI tools and addressing its risks, retailers can unlock the full potential of this technology over the next decade, creating a future where personalised and innovative retail experiences become the normal rather than the exception.