At shopping centers and retailers across the country — and in the lives of consumers — AI is coming on strong.
Researchers, retailers, shopping center executives and brands are deep into exploring the present and potential impact of AI, for better or worse. Accelerated growth is seen in generative AI, which creates content such as text, images or code, and agentic AI, which provides agents acting independently to complete tasks.
Applications like personalized recommendations, dynamic pricing and automated inventory management have been around for years, but AI advancements are taking personalization, payment systems, search, insights into consumer behavior, marketing, ordering and replenishment, store design, and product information for store associates to new levels. And AI is opening up opportunities for workers to be retrained for roles requiring more of the human touch, for operational efficiencies, for eliminating costs after initial investments, and for making it quicker and easier for people to shop and find what they want.
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On the other hand, AI is seen increasingly replacing jobs, reducing traffic in stores and shopping centers, raising cybersecurity concerns, and is costly to implement. Ironically, as consumers habitually use AI agents to shop and transact, they’ll also develop a greater appetite for live experiences interacting with humanity in stores and shopping centers.
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‘More Intentional Trips’
“With a projected $1 trillion in U.S. retail revenue from agentic commerce by 2030, AI will result in more intentional and higher value trips to shopping centers,” predicted Tom McGee, president and chief executive officer of the ICSC, the large trade organization representing malls, mixed-use, lifestyle centers and other destinations where people live, work and shop.
ICSC last week released a report in conjunction with McKinsey, the management consulting firm, on how AI is affecting shopping. “Our report highlights that AI is now a big part of the customer journey to search, compare, and even automate purchases, with 68 percent of those surveyed using at least one AI tool in the past 90 days,” McGee said in an email exchange with WWD.
“Further, the role of physical stores becomes even more critical as digital tools become more embedded in shopping. Stores deliver human connection, discovery, and experience in ways AI cannot replicate…As AI takes on more of consumers’ research, comparison, and even purchasing process, stores will play different roles, serving as sites for order fulfillment, convenient returns, product validation, immediate purchase, and differentiated experiences.”
The ICSC/McKinsey report indicates that with the advent of AI, retailers must assign each location a primary mission, be it a convenience hub, a discovery flagship, or a fulfillment node. Asked if a single location could put equal weight and resources into all three, or must prioritize one function over another, McGee answered, “While some large retailers may retain elements of both convenience and discovery, our research finds that individual stores that don’t prioritize specific functions risk doing neither task well. Retailers must be targeted in their investments and focus on successfully executing one mission rather than being a jack of all trades. However, it’s a different calculus for property owners: developers and shopping centers are often best served by mixing convenience and discovery, curating ‘ecosystems’ of diversified tenants that appeal to a shopper’s broader needs.”
Conclusions from the ICSC/McKinsey report are based on a survey of more than 3,000 U.S. consumers about their shopping preferences, interviews with retail and real estate executives, and McKinsey’s own analysis.
Among the report’s key findings, the most profound structural shift in shopping over the next several years may be the rise of agentic AI, or systems that can act on a consumer’s behalf to search, compare, recommend, and complete purchases. By 2030, the U.S. business-to-consumer retail market alone could see up to $1 trillion in revenue from agentic commerce, with global projections reaching as high as $3 trillion to $5 trillion. Ninety percent of executives said they have considered introducing an agentic commerce tool, but fewer than 5 percent reported having a board-aligned agentic commerce strategy.
The report also emphasizes that as AI capabilities accelerate, retailers and real estate developers that delay embracing the technology risk widening a gap between consumer expectations and their ability to meet them. “It’s a gap they may struggle to close.” As more repeat purchases become automated, the need for store trips declines, shopping moves from browsing to outcome setting, and consumers express a goal once, and the system increasingly manages the rest.
Apparel, Footwear a Key Category
The report indicated that more U.S. consumers said they use AI to find information on home electronics, apparel, footwear and jewelry, rather than pet care services and vehicles, with 62 percent reporting using AI to compare brands, models, prices or reviews. The report warns that AI-induced changes in shopping behavior could arrive before retailers are ready.
EY, the global professional services provider formerly called Ernst & Young, issued an AI impact report last week in conjunction with the World Retail Congress annual forum. Among EY’s conclusions: store associates will become “trusted” advisers, upselling and cross-selling products and services to customers; localized, customer-facing AI applications will deliver growth in pockets without the benefits of scale, and retail operating models will shift toward a centralized AI-led core to support complex localized store and channel strategies.
On the negative side, EY cites rising cybersecurity risks and an unclear regulatory environment, making it hard to invest in AI with confidence. Also cited were AI’s high up-front implementation costs and uncertain returns from the investment, a lack of clear KPIs (key performance indicators) to measure the value of AI investments, and complexity in adapting operations and the store culture to AI.
EY’s methodology for its impact study was complex, including tapping the minds of futurists, and triangulating results from three surveys, including one that queried more than 18,000 people aged 18 plus spanning 23 markets, another involving 1,200 CEOs over time, and another surveying over 1600 technology leaders and buyers in the industry assessing their perceptions of emerging technology and the vendor landscape.
“AI, and particularly AI agents, will further shift how consumers research and transact. Over time, for example, more routine and replenishment purchases could be delegated to agents — but that dynamic ultimately reinforces the role of the store,” Malin Andrée, EY’s global; Europe, the Middle East, India and Africa; and Nordics retail leader, told WWD via email. “With each new wave of technology, whether it’s the rise of e-commerce, mobile, or social commerce, the role of the store has changed. But it remains essential. Physical retail is still the primary point of purchase for most shoppers, because it is convenient and because of the social and experiential aspects it offers. We’ve already seen retailers and major shopping centers reinvent themselves as social and community hubs, with elevated food offerings, brand pop-ups and events that fulfill that desire for connection.”
Andrée said more than seven in 10 consumers, globally, believe AI usage actually increases their desire for human expertise and creativity. “For retailers, that puts more emphasis on the role of the store associate, those who can engage, advise and add the perspective consumers crave. Retailers that effectively deploy AI in their physical stores recognize the human elements at the core of the in-person shopping experience. As AI adoption grows among consumers, it is actually accelerating demand for real-world connection and expertise. Leading retailers will respond by creating more engaging, experience-driven store environments, while investing in AI and other solutions that equip associates to better serve shoppers.”
Asked what jobs in shopping centers and stores are most threatened by AI, Andrée answered, “Store associates balance a wide range of responsibilities, from back-of-store tasks like restocking and inventory management to helping customers. AI is increasingly used to streamline those operational tasks, such as identifying out-of-stocks or managing pickup orders, freeing up time for more customer-facing roles.
“At the same time, it can equip associates on the floor with tools to better serve customers, such as chat-based systems to quickly answer questions or search for product availability,” Andrée added. “Rather than eliminating jobs, these applications reduce time spent on routine work to enable the meaningful, human interactions customers value.”
Job Cuts Inevitable
Still, the EY/World Retail Congress report suggests that with increased automation of processes and activities, headcounts get “drastically reduced” with retail operations managed by AI, robotics and a small group of technologists. Furthermore, strategic direction, creativity and high levels of service, “are delivered by smaller workforces who use AI to supplement human skill sets. Underemployment, shorter working weeks and universal basic income have created a thriving gig economy that drives innovative entrepreneurial mindsets.”
On behalf of EY, FT Longitude, the research and content marketing division of The Financial Times Group, conducted an anonymous online survey of 1,200 CEOs from large companies around the world between November and December 2025. It addressed CEOs’ attitudes toward AI as they enter 2026.
Among the findings:
- Fifty-four percent said generative AI tops the list of transformative technologies, reflecting how rapidly it has moved from experimentation to enterprise integration, particularly across content generation, coding, customer engagement, and knowledge-intensive workflows.
- Forty-five percent mentioned machine learning as the analytical backbone for prediction, forecasting, and decision intelligence.
- Thirty-seven percent cited agentic AI shifting from “AI as assistant to AI as operator, taking on tasks that previously required human intervention.
- Thirty percent cited physical AI — robotics and automation — as demonstrating continued momentum thereby “strengthening operational adaptability where labor, supply chain, or cost pressures persist.”
- Twenty-seven percent cited natural language processing as continuing to underpin everyday interactions but competing with generative AI for transformational attention.
“Companies are moving from isolated AI use cases to integrated AI systems that could reshape workflows, automate decisions, and augment human capability at scale,” EY reported.
The Boston Consulting Group global management consulting firm, in a recent report on the impact of AI on shopping centers and retailing, projected, “Data-driven predictive modeling of an asset’s future performance, as well as AI-enhanced capital allocation methodologies, can help operators to achieve better balance-sheet management and a greater focus on high-performing assets in their portfolios. Similarly, automated tenant onboarding can reduce tenant management costs, while scenario-based planning can boost operators’ product and market development.”
BCG also observed that digital tools are being used to standardize mall design and construction, to develop retail media networks and create customer apps, and to select landmark customer attractions such as indoor skiing centers and 3D cinemas. AI is expected to reduce routine, errand-based trips to malls by streamlining online research, personalized recommendations, and purchasing, acting as a “concierge” that handles shopping tasks. However, it may lead to increased visits for experiential, leisure-focused shopping.
BCG said that AI will shift mall layouts toward enhanced experiences, that consumers are increasingly using AI chatbots for product research, reducing the need to visit stores for information gathering, and that AI reduces the “friction” of online shopping, such as sizing issues or search fatigue, decreasing the necessity to visit a mall to “see it in person.”
Data-driven predictive modeling of an asset’s future performance, as well as AI-enhanced capital allocation methodologies, can help operators achieve better balance-sheet management and a greater focus on high-performing assets in their portfolios, BCG indicated. Similarly, automated tenant onboarding can reduce tenant management costs, while scenario-based planning can boost operators’ product and market development.
According to ICSC’s McGee, “AI augments the work retail employees do and allows them to focus their time on more valuable tasks. Our report highlights that AI adoption throughout the industry will primarily impact routine, repetitive tasks, such as inventory management, scheduling, or basic customer inquiries. As automation reduces the time associates spend on those types of tasks, the nature of their work will shift toward activities that require judgment, problem-solving, and customer interaction.”
McGee sees retailers stepping up training of store associates in their use of AI-powered tools. The tools, built on data from past purchases, preferences and browsing behavior, will enable associates to provide more informed and engaging service tailored to individual customers.
At shopping centers, McGee said, “Today, AI is already driving efficiencies with owners and operators using it to analyze traffic patterns and support decisions on operations. Meanwhile, retailers are applying AI to improve inventory management, pricing, and merchandising.”