The National Retail Federation (NRF) is the world's largest retail trade association, representing retailers from the United States and more than 100 countries. Its annual convention, often referred to as "Retail's Big Show," is a premier event that brings together industry leaders, innovators, and visionaries to explore the latest trends, challenges, and opportunities in the retail sector. With 40,000+ attendees, 1,000+ exhibitors, and 175+ sessions, NRF2025 is a cornerstone for retail innovation.
For OSF, attending NRF2025 is a strategic decision. The event offers a comprehensive view of the retail industry's current challenges and opportunities. Showcasing cutting-edge technological advancements and real-world applications, it provides invaluable insights into the future of retail.
The AI Revolution in Retail
The first day of NRF2025 put a significant spotlight on Artificial Intelligence (AI) and its potential impact on the retail industry. Use cases demonstrated how AI is driving personalized experiences and enabling 24/7 shopping assistance at scale. These innovations are driven by massive data sets that form the foundation for Generative AI (GenAI) and Large Language Models (LLMs).
LLMs are AI models designed to understand and generate human-like text, while Small Language Models (SMLs) are more focused and efficient for specific tasks. While LLMs are used for broad, conversational capabilities, SMLs are tailored for domain-specific tasks.
The transformation AI brings to retail is profound. Retail's main assets are its people, and one key takeaway from the NRF2025 keynote on change management was clear: AI won't replace jobs, but those leveraging GenAI will outperform those who don’t.
Revolutionizing Inventory and Supply Chain with AI
Inventory management can make or break the retail experience. and AI is revolutionizing supply chain operations. AI's impact on the supply chain is significant, with "Physics AI" understanding volumes and interactions between people and objects in stores or warehouses . Today, 80% of retail revenues come from physical stores, and Physics AI is helping deploy digital twin warehouses to simulate different setups and improve efficiency. This technology is paving the way for "Physical AI," which will train robots to operate in physical locations like warehouses and stores. AI technologies are already generating store planograms using real-time inventory and business goals, connecting in-store and sales data for superior planning.
The Era of Agentic Architecture in Retail Information Systems
Agentic architecture refers to systems where AI agents operate autonomously, making decisions and taking actions. The multiplication of agents working in teams is imminent, with the concept of "AI talking to AI" becoming a reality. For instance, an AI agent detecting an issue in a warehouse can communicate with other AI agents to reroute resources and optimize operations.
Agentic AI is trained to be domain-specific and can instruct other AI systems. "Perception AI" supplements "Conversational AI" by orchestrating a network of agents, enhancing their ability to work together seamlessly.
Embrace AI Now
If your organization hasn’t embraced AI yet, the time to act is now. AI initiatives must be driven by leadership, as their transformational nature requires strong executive involvement. A quick win strategy for retail is to focus on AI for supply chain optimization and enhancing customer experience, particularly online.
Ready to Bring These Innovations to Life?
At OSF Digital, we specialize in helping companies harness the power of AI and other cutting-edge technologies to address real-world challenges. Whether you’re looking to optimize processes, enhance customer experiences, or innovate for the future, we can provide the expertise and solutions you need.
Contact us today to discover how we can help drive your business forward.
