Observed Signal · Sep 9, 2026 · Product Launch · Source: Retail Dive · Impact: 3/5 · Sentiment: Positive
Artificial Intelligence in Retail Market: Retailers Invest in AI for Supply Chain and Shopping
Major retailers, including Gap, Dollar General, Ulta Beauty, and Kohl's, are accelerating AI adoption across supply chain, customer experience, and internal operations, as revealed in their Q2 earnings calls. Ulta's CEO Kecia Steelman highlighted early AI adoption for productivity and scaling opportunities, with new CTO Kelly Garcia advancing tech initiatives. Gap's capital expenditure for technology and supply chain is set at $650 million. Ulta uses AI for sourcing, inventory optimization, and AI-powered search and discovery, including its on-site shopping agent Ulta AI. Kohl's CEO Michael Bender reported early positive results from its AI shopping assistant, improving conversion and revenue per visit. Dollar General's CEO Todd Vasos mentioned building agentic operating systems for enterprise workflows, with net sales up 5.2% to $11.3 billion. Bain partner Aaron Cheris notes that most retailers are applying AI to specific areas rather than pursuing full AI transformation, with examples like Home Depot's Magic Apron and Walmart's Sparky.
Retailers are increasingly adopting AI across supply chain and customer experience, indicating a significant shift toward AI-driven retail operations that influences advertising and customer engagement strategies.
Key Takeaways & Evidence Grounding
- Gap Inc. expects capital expenditure of $650 million this year for stores, technology, and supply chain.
- Ulta Beauty is investing in AI for supply chain, search, and discovery, and promotes its Ulta AI shopping agent.
- Kohl's AI shopping assistant is resulting in stronger conversion and higher revenue per visit.
- Dollar General's net sales rose 5.2% year over year to $11.3 billion, and it is developing agentic operating systems.
- Retailers are deploying AI for supply chain optimization, customer experience, and internal productivity.
- Examples of AI shopping tools include Home Depot's Magic Apron and Walmart's Sparky.
Connected Companies & Entities
7 Entities mappedWalmart
Omnichannel retailer with marketplace, membership, B2B procurement and retail media.
“Walmart’s commerce agent Sparky stand out as examples...”
Ulta Beauty
Omnichannel beauty retailer with retail media and marketplace revenues.
“Ulta named former Domino’s executive Kelly Garcia as its new CTO ... will continue to advance ... technology capabilities...”
Gap Inc.
Public apparel brand owner and omnichannel retailer.
“Gap Inc.’s capital expenditure is expected to reach $650 million this year...”
Bain & Company
Global strategy consultancy with embedded data, software and AI services.
Kohl's
US omnichannel retailer with marketplace, loyalty and retail media operations.
“Kohl’s CEO Michael Bender said ... encouraged by early signs of the store’s AI shopping assistant...”
The Home Depot
Home improvement retailer with e-commerce, retail media, and pro services.
“Tools like Home Depot’s generative AI shopping tool Magic Apron...”
Dollar General
US discount retailer with digital commerce, loyalty and retail media.
“Dollar General CEO Todd Vasos said ... building agentic operating systems for enterprisewide workflows...”
Ontology Mapping & Concepts
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