AI spending in retail, consumer goods set to increase by 52% in 2025, expanding beyond IT budgets: report

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Azunta Gaviola

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8 months ago

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Singapore – A recent study from the IBM Institute for Business Value found that AI spending in retail and consumer products is expected to increase by 52%, extending beyond the traditional IT budgets in 2025.

Based on the research, companies are projected to allocate an average of 3.32% of their revenue to AI by 2025, amounting to $33.2m annually for a $1b business. Said shift in investment is moving beyond traditional IT functions to areas such as customer service, supply chain operations, talent acquisition, and marketing.

It was also revealed that around 81% of executives and 96% of their teams are already leveraging AI to a moderate or significant degree. Executives plan to increase AI usage by 82% in areas including integrated business planning by 2025.

Moreover, the report showed that 31% of employees need to develop new AI-related skills within the next year, with said figure increasing to 45% within three years. 

AI-driven applications in customer service, especially for personalised responses, are also anticipated to grow by 236% in the next 12 months, indicating 55% of these advancements depend on human-AI collaboration.

Companies are further expected to increase their investment in AI ecosystem platforms, noting a projected increase from 52% today to 89% within three years. These platforms, which support the exchange of data and AI models, play a vital role in fostering innovation and enhancing operational efficiency. 

Interestingly, the report also found a major gap in AI governance, as fewer than 25% of executives have fully implemented risk management tools to address issues like bias, transparency, and security.

Commenting about the report, Dee Waddell, global industry leader, consumer, travel, and transportation industries at IBM, said, “AI is no longer just a tool; it’s a strategic imperative. Retail and consumer product companies are at a tipping point where embedding AI across their operations can help define not just productivity gains, but the future of brand relevance, engagement, and trust.”

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Video Title Here: The Indonesian on-ground activation status

Sed ut perspiciatis unde omnis iste natus error sit voluptatem accusantium doloremque laudantium, totam rem aperiam, eaque ipsa quae ab illo inventore veritatis et quasi architecto beatae vitae dicta sunt explicabo. Nemo enim ipsam voluptatem quia voluptas sit aspernatur aut odit aut fugit, sed quia consequuntur magni dolores eos.

Video Title Here: The Indonesian on-ground activation status

Sed ut perspiciatis unde omnis iste natus error sit voluptatem accusantium doloremque laudantium, totam rem aperiam, eaque ipsa quae ab illo inventore veritatis et quasi architecto beatae vitae dicta sunt explicabo. Nemo enim ipsam voluptatem quia voluptas sit aspernatur aut odit aut fugit, sed quia consequuntur magni dolores eos.