Retail’s next competitive edge is AI that takes action

Zendesk has strong relationships with retail customers, and one thing we’ve learned over the years is retail rewards businesses who respond quickly to changing customer demand. But today, that demand can shift overnight. A viral product, a shipping disruption, or a surge in returns can expose weaknesses just as quickly as they create new opportunities.

At the same time, customers expect faster service, more personalized experiences, and immediate action when something goes wrong.

AI has become an essential part of how retailers meet those expectations. But its potential is expanding. The first generation of retail AI focused on making customer service more efficient. The next is helping retailers improve how the business operates: taking action on customer needs, uncovering signals hidden in customer conversations, and helping teams adapt faster.

Customer service may be where retail AI starts. It’s no longer where its value ends. Three principles can help retailers realize that bigger opportunity.

The first generation of retail AI focused on making customer service more efficient. The next is helping retailers improve how the business operates. 

Make AI an action layer, not an answer engine

Today’s customers expect AI to help them make progress. They don’t want to read a return policy or shipping information. They want to make a return or find out where their order is.

To meet those expectations, AI has to become part of the retail operation itself: checking order status, processing exchanges, updating deliveries, or escalating time-sensitive situations when human judgment matters. Instead of creating another step in the customer journey, AI becomes the mechanism that keeps it moving.

Online bridesmaid dress retailer Birdy Grey was seeing growing volumes of questions from brides and bridesmaids navigating tight wedding timelines. Rather than matching customers to static FAQs, Birdy Grey’s Forethought AI Agents by Zendesk assessed each customer’s intent and determined the next best action. Whether that meant checking an order, guiding a return, or escalating an urgent request to a human agent, customers could make progress without waiting for manual intervention.

That freed Birdy Grey’s support team to focus on critical conversations where empathy and expertise mattered most. But taking action is only the beginning. At scale, those interactions can also reveal what is happening across the business.

Build for adaptation, not automation

Retail has always been unpredictable. The real test of any operating model isn’t how it performs on a normal day. It’s how quickly it can respond when something unexpected happens.

Birdy Grey faced exactly that when a wave of shipping delays threatened to overwhelm its support team. The team used Autoflows to launch a tailored support experience in a single day by describing the workflow in plain language.

The new workflow checked order details, delivered personalized updates, and ensured customers with imminent wedding dates were prioritized for human support. Rather than overwhelming agents with every inquiry, the team could focus on the customers who needed them most. The important shift wasn’t simply automating more work. It was being able to quickly change how the team responded as conditions changed.

Retailers cannot predict every surge in demand, fulfillment problem, or disruption. But AI can give teams a faster way to respond. The competitive advantage isn’t predicting every disruption. It’s adapting faster when it happens.

The bigger opportunity

Birdy Grey’s results show what this shift looks like in practice. Today, the retailer automates 45% of customer conversations across channels, increased CSAT from 2.2 to 4.2, and improved instant resolution rates by 16 percentage points.

Those are meaningful customer service outcomes. But they’re only part of the opportunity. When AI can take action on customer needs, identify patterns across conversations, and help teams respond quickly when conditions change, customer service becomes a source of action, intelligence, and adaptability for the entire business.

AI can resolve the issue in front of the customer. It can reveal what customers are collectively telling the business. And it can give teams a faster way to respond when conditions change.

Customer service may be where that opportunity starts. It’s no longer where it ends.