How EX, CX and AI Are Joining Forces to Redefine Shopping Experiences

The average U.S. household currently spends $9,343 a year on groceries — 27 percent more than in 2020. With costs rising, it’s no surprise that consumers are rethinking the value equation, and grocers are facing mounting pressure to deliver better customer experiences while managing slim profit margins.

The result is a keener focus on driving loyalty through customer experience (CX) and leveraging technology to enhance these initiatives. More notably, though, grocers are recognizing the link between employee experience (EX) and its impact on CX, as well as the role of artificial intelligence in shaping both.

The Transformative Effect of AI

In retail, there’s a tension between wanting to be seen as an early adopter and moving too quickly, allowing competitors to learn from the mistakes made by the fast movers. As AI use cases become clearer, it’s evident that automation — from processes and decision-making — is crucial to running more efficient, profitable retail organizations.

Behind the scenes, AI can use advanced demand forecasting to transform supply chains, reduce waste, and streamline stock control. This means shelves are stocked with products that customers want, in the colors, flavors and sizes they need, at the right time.

But it’s with hyperpersonalization of the shopper experience where AI’s promise really lies. Its ability to process shopper data at supersonic speed and make real-time recommendations will supercharge CRM by tailoring offers and rewards to individual preferences. Retailers like Target are capitalizing on this, using AI to deliver a smoother shopping experience by making more targeted suggestions to customers through its app.

Pre-ordering will also showcase AI’s potential, as recommendations become especially important during this stage of the customer journey — particularly when delivering value. Week-to-week, grocery orders don’t change much, but consumers will be grateful for being told they can make five recipes instead of three, for example, by adding just one more item to their basket. With advances in agentic AI, which learns without human input, these capabilities will only grow, making grocery shopping more intuitive and efficient.

Related story: AI and Retail CX: 3 Key Considerations for C-Suite Executives

Impact of EX on CX

While e-commerce is thriving — projected to reach $1.38 trillion later this year in the U.S. alone — 74 percent of grocery purchases still happen in physical stores. Within this context, AI’s role in improving CX is reliant on how the technology improves EX.

Effective use of AI is invisible to the customer. By automating mundane, behind-the-scenes tasks, AI can empower employees to focus on relationship-building and delivering exceptional in-store experiences — the things that really matter.

Of course, there are fears that automation will make many retail jobs redundant. But that shouldn’t be the case. AI can help not by replacing retail staff, but by helping them work faster and smarter, armed with real-time data on product availability and individual shopper preferences.

Human employees will also remain essential for in-store experiences that AI cannot replicate, such as optimizing store layouts and creating appealing displays. While AI can serve as a valuable training tool, breaking down complex instructions into digestible steps, it lacks the ability to sense the atmosphere, the feel, or the smell of a location. Nor can it adapt to the nuances of human interaction. Employees, freed from repetitive tasks, can focus on these high-value elements.

AI can help fine-tune initiatives that retailers are already doing well when it comes to CX. Costco, for example, is renowned for its employees offering food or wine tastings to customers, suggesting recipes available in-store for upsells. Combining AI’s wealth of knowledge with the reassurance of speaking to a human yields an even more satisfying consumer experience. A well-informed workforce, empowered by AI, is key to delivering value.

Reinventing the Store Experience

Unlike the exploratory nature of shopping for furniture or clothing, grocery shopping is often a chore. At Ikea, consumers have to go in-store, pick things up, and sit on them — whereas broccoli is the same wherever it’s bought; you don’t need to see it in person.

However, physical stores still hold unique advantages. For instance, customers are far more likely to make impulse purchases in-store than online, which is why creating a more engaging, even relaxing, environment is essential.

The aim should be to encourage customers to spend a little longer in-store. Target’s partnership with Starbucks is a perfect example, with its curbside pickup system providing a satisfying end to a convenient shopping experience — and a little something to look forward to.

In an effort to keep up with its rivals, Walmart and Publix are taking this a step further with revamped flagship stores offering experiences like dining or even a beer while you shop. If that doesn’t encourage customers to linger longer in-store, nothing will.

Building Out the 4 Ps of Retail

As grocers navigate times of unprecedented uncertainty, it seems that, in addition to the four Ps of product, price, place, and promotion, there are convincing arguments for building CX, EX, and AI into retail strategies. This combination has the power to maximize the appeal of physical stores and avoid a race to the bottom.

U.S. consumers are having to spend more on their grocery shopping. For retailers, that means helping them feel better about having to do so — and offering value. However, undercutting the competition isn’t sustainable and won’t make you stand out. Delivering a memorable experience, whether online or in-store, by embracing AI and using it to enhance existing differentiating factors is the new key to providing value to consumers.

Christine Bourdon is head of design and creative, Americas at Designit, an experience innovation company with creativity at its core..