Retail’s AI Revolution Begins With Composability
Artificial intelligence has transformed retail by allowing retailers to make the most of predictive analytics and automation. Generative AI, in particular, helps retailers develop personalized content and automated customer engagement. And now, agentic AI is poised to upend e-commerce via automated merchandising, competitive analysis, and even shopping assistants. But is all this technology evolution simply moving too quickly?
As of January, 90 percent of retailers reported they were currently adopting or piloting AI projects. This fervent push for AI is driven by a desire not to fall behind and has forced retailers to move and adapt quickly while rethinking their entire business.
To lay a foundation for long-term business success and support their AI initiatives, retailers are turning to composable — a mindset that leverages open technology to recreate business processes and leads to more agile ways of working across the enterprise.
Anchoring AI Success With Composability
According to the MACH Alliance’s latest research, 77 percent of organizations that have embraced composability also reported adoption of AI. Meanwhile, only 36 percent of organizations that are in the early stages of their digital transformation are also leveraging AI technology.
These statistics help us understand that the relationship between AI and composability is more correlation than causation. There’s a shared mindset between composability and AI.
The retailers that prioritize modernization and agility are the same retailers that implement composable infrastructures and enable successful AI initiatives. This is in part because a composable approach ensures agility, data visibility, scalability, and vendor independence — all critical qualities for AI success.
An open, API-first technology setup ensures that AI technologies can easily connect to all of a retailer’s data and services without the need for complex, custom workarounds often needed with legacy platforms. Since AI’s effectiveness relies on access to high-quality data that's both accurate and timely, composable principles help retailers align with the technology’s intense computational needs, including:
- Event-Driven Processing: Allowing a retailer’s AI models to instantly react to new information rather than needing to wait for scheduled data updates.
- Interoperability: Connecting solutions across a retailer’s platforms ensures that AI can access necessary information across departments like customer service, inventory management, and merchandising.
- Integration of Autonomous AI Agents: Carrying out real-time data analysis and executing complex actions without the need for human intervention.
As AI continues transforming retail, adopting a composable approach allows retailers to quickly experiment with new capabilities, reduce the risk associated with such experiments, and retain control of their overall strategy while maintaining speed to market. On the other hand, retailers that still operate on rigid and outdated technology platforms will lack proper agility, making it tough to effectively scale AI pilots and meet corresponding business strategies.
Addressing Common Composability Misconceptions
Embracing composability doesn't mean that retailers must implement a specific, complex framework of technology solutions, nor should they completely reject traditional architectures, particularly if that's the right avenue for their specific brand.
Adopting a composable approach allows brands to build adaptable, high-performing technology ecosystems. However, organizations should keep the necessary operational context and long-term business strategy front of mind. At its foundation, composability is an architectural approach that prioritizes flexibility, scalability and innovation when strategically applied to the right scenarios. This includes how brands integrate AI solutions.
As retail business and technology leaders look to scale AI initiatives and build adaptable customer experiences, having a composable architecture in place simply streamlines integration throughout a retailer’s business processes, setting up the brand for success rather than a headache.
Future-Proofing AI Innovation With Best-of-Freed Foundations
Along with AI, composable technology has significantly evolved, and the retailers that truly understand how it can be the most valuable for their particular brand will lay the right foundation and thrive. These will be the brands that develop truly innovative AI initiatives and create more agile, impactful customer experiences.
Bob Howland is chairperson of the MACH Alliance, a not-for-profit industry body that advocates for open, best-of-breed technology ecosystems, a modern approach to building platforms that are resilient, composable, and connected.
Bob Howland is chairperson of the MACH Alliance, a not-for-profit industry body that advocates for open, best-of-breed technology ecosystems, a modern approach to building platforms that are resilient, composable, and connected.
