A comprehensive new study by Tata Consultancy Services (TCS) has spotlighted a growing disconnect in the global retail industry: while artificial intelligence (AI) is widely heralded as a cornerstone of future competitiveness, meaningful deployment of advanced AI systems remains elusive for most retail organisations. The TCS Global Retail Outlook 2026, a survey of more than 800 senior retail executives from 18 countries.
Cheenttan Voraa, Global Head of Retail Consulting, TCS, said, “The retail sector is at a defining crossroads. Leaders recognize AI as an essential technology to stay ahead in the next era of competitiveness, yet most organizations remain early in their journey toward true enterprise intelligence. Advancing from siloed use cases to connected, perceptive systems will require bold investments, not only in technology but in AI-savvy talent, along with improved processes and operating models. TCS is committed to partnering with retailers and empowering them to lead in the AI era.”
Superficial Engagement with AI, Deep Challenges Ahead
Although a majority of industry leaders acknowledge AI as a top enabler of growth and resilience, the reality of adoption is sobering. According to the study, 85% of retailers have not yet begun implementing or even planning for multi-agent AI systems, which are essential for autonomous, interconnected decision-making across complex retail workflows. Only 24% currently use AI for autonomous decision-making processes.
For most businesses, AI still means tools like chatbots and virtual assistants. The study found that 51% of respondents cite these basic AI applications as their leading initiative.
Strategic Priorities vs. Implementation Gaps
The research positions AI-powered technologies immediately after cost optimisation among the capabilities retailers view as critical for 2026. Capabilities that enable real-time sensing of market shifts and adaptive AI decisioning rank among the top priorities for executives, but, troublingly, this priority does not yet translate into widespread operational execution.
Retailers’ use of data and insights also highlights areas of underperformance. Only 37% use loyalty insights to shape store or channel experiences, and 45% apply those insights to pricing and promotional strategies, both foundational levers for commercial performance in the digital economy.
The study also identifies the workforce skills gap as a central barrier to AI transformation. Just one-third of retailers (33%) believe structured digital literacy programs will help them meet future organisational challenges and talent needs.
