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AI, Data Analytics, RFID to be focus areas for retail tech investments

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Mannu Mathew
Mannu Mathew
With over four years of experience, Mannu Mathew specializes in business journalism with a focus on technology, the retail sector, D2C, and E-commerce brands. He is working as the Assistant Editor for India Retailing and Images Retail Magazine.

Retail CXOs share insights on technology investments in 2025

New Delhi: In 2025, technological investments in retail are poised to play a critical role in shaping operations, customer experiences, and overall business strategies. From AI-driven personalisation to enhanced data governance, the retail industry is navigating opportunities and challenges in adopting cutting-edge technologies, according to various brand CXOs who spoke to IndiaRetailing (IR).

In July 2024, IR reported that technology investments in the retail sector were expected to increase in the coming months, based on a poll conducted. Approximately 60% of the respondents, who are retail professionals, indicated that investments would rise, while 20% believed the increase would be marginal.

“The year 2025 will strongly embrace technological transformation, driven by artificial intelligence (AI) and natural language processing. Compared to last year, when organisations barely scratched the surface of AI integration, this year promises deeper adoption,” said Amarinder Dhaliwal, chief product officer (CPO), IndiaMART, a Noida-based online B2B marketplace.

“The B2B sector will also focus on personalisation and hyper-localisation to achieve better penetration in tier 2 and 3 cities and to improve customer experiences,” he added.

For Bengaluru-based omnichannel brand Snitch, significant investments would be in three key areas, Shop the Look (Leveraging image vectorization and algorithms based on customer purchase), virtual try-ons (Augmented Reality (AR)-powered try-ons) and personalization based on user signals.

“We’re also investing in privacy-first technologies, robust data governance frameworks, and tools to ensure transparency and consent management. These regulations also drive us to adopt more secure and efficient data storage solutions. This focus not only ensures compliance but also builds customer trust, which is invaluable in the competitive retail landscape,” said Maruthy Ramgandhi, chief technology officer (CTO), of Snitch.

AI & Data Analytics take centre stage.

AI continues to dominate the retail technology landscape, with industry leaders emphasising its potential for predictive actions and operational efficiency. Nitin Chhabra, chief executive officer (CEO), ace turtle, a Bengaluru-based tech-driven omnichannel retail brand, highlighted AI’s role in enhancing demand forecasting, optimising supply chains, and driving personalised customer experiences.

Anirban Chakraborti, senior vice president (SVP) of Omnibusiness & Technology at Sangeetha Mobiles, too emphasized AI’s ability to address issues proactively, helping retailers “nip problems in the bud.”

Sumit Singh, chief executive officer (CEO), DashLoc, a Bengaluru-based marketing services company, noted that automation powered by AI and machine learning could handle up to 70% of routine retail. This shift would allow businesses to focus human capital on creative and strategic activities, further enhancing customer engagement and innovation.

IndiaMART, meanwhile, is also leveraging AI to address challenges in searches, particularly in areas like misspellings, Hinglish searches, and voice-based queries. “The idea is to tackle these challenges each month while helping buyers connect with the most relevant sellers. Given India’s linguistic diversity, we currently support navigation in English and Hindi, with search capabilities in over 200 languages and voice search in nine languages,” added Dhaliwal.

This has been a similar trend in the beauty and wellness segments. For Gurugram-based beauty and wellness brands Honasa Consumers, the parent company of brands like Mamaearth, Staze etc., current tech priorities include building immersive experiences such as virtual try-on for makeup and lipsticks, live-streaming capabilities, AI-powered skin assessment tools for personalized product recommendations & regimes, and MarTech optimizations to drive efficiency, said the company’s newly appointed Senior Vice President- Technology & Engineering Lokesh Chhaparwal.

Inventory management & RFID

While investments in AI and automation take centre stage, inventory management remains one of the most critical aspects of offline and online retail. Rupendra Kumar Nigam, Head IT (VP) at Spykar Lifestyles, a Mumbai-based jeanswear brand, highlighted key challenges, such as real-time tracking and the integration of legacy systems with modern platforms.

Many retailers are exploring RFID technology to streamline inventory processes, store audits, and warehouse management. However, high implementation costs and quality issues with RFID tags have hindered widespread adoption.

Spykar is cautiously optimistic about RFID but emphasises the importance of efficient implementation and cost-effective solutions to achieve ROI. “If data is not accurate, even the best technologies like AI and RFID will fail,” said Nigam.

Measuring ROI & addressing challenges

Retailers are increasingly adopting nuanced approaches to measure the return on investment (ROI) of their tech investments. Ace Turtle focuses on key performance indicators (KPIs) such as improved demand forecasting, reduced lead times, and higher customer satisfaction. Sangeeta Mobiles evaluates success based on metrics like incremental cost per transacting customer and cost per view on systems, ensuring that the customer remains central to every project.

“We measure the ROI of our tech investments primarily through rigorous A/B testing for every new feature we introduce. This helps us evaluate the direct impact of these features on key metrics such as purchase conversion rates and customer retention,” added Ramgandhi of Snitch. “For 2025, our goal is to use this data-driven approach to consistently deliver features that enhance customer engagement, streamline the shopping experience, and drive sustainable growth in both revenue and loyalty.”

However, integration challenges, such as legacy systems, fragmented data, and the high costs of SaaS models, remain significant hurdles. Retailers are also prioritising sustainability, adopting eco-friendly supply chain solutions and energy-efficient operations to ensure scalable, environmentally responsible growth.

“We assess ROI not only through immediate impacts like conversion, engagement, and click-through rates but also extend to include reliability, performance, and cost efficiency by ensuring long-term readiness, continuously enhancing the overall platform experience,” said Chhaparwal of Mamaearth.

While AI, RFID, and data analytics lead the investment charts, their success hinges on robust implementation, compliance with evolving regulations, and a clear focus on ROI.

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