Retail Leadership in the Age of Agentic AI: What Comes Next

If 2023 was the year retailers asked “What’s possible with AI?” and 2024 was the year of groundwork and pilots, then 2025 is the year of action—and consequence. The latest Lucidworks Generative AI Benchmark Report I read recently makes that abundantly clear: the race is no longer about curiosity or experimentation. It’s about execution. And in retail, that execution must be both foundational and forward-thinking.

As we head into the second half of 2025 and prepare for 2026, the question for retail leaders isn’t whether to embrace AI—it’s how to implement it wisely, sustainably, and in a way that truly enhances the customer experience.

The Era of Agentic AI Is Here—Are You Ready?

The report introduces a pivotal term: agentic AI—systems that act autonomously, plan multi-step tasks, and adapt in real-time with minimal human input. Think of it as moving from smart tools to capable teammates.

But here’s the leadership lesson: while the industry buzz surrounds advanced features like conversational commerce or generative chatbots, the data shows that foundational capabilities still drive the bulk of ROI.

“Implementing advanced AI without mastering the essentials is like building a penthouse on a weak foundation.”

— Mike Sinoway, CEO, Lucidworks

Foundational First: Essentials That Still Move the Needle

Retailers that deploy core capabilities—like personalized recommendations, real-time product availability, hybrid search, and dynamic promotions—see 2X the conversion lift compared to those chasing flashy innovations without a solid base.

Foundational capabilities to prioritize in 2025-26 include:

• Relevancy ranking for more intuitive search results
• Real-time inventory integration for store pickup or same-day delivery
• Multilingual experiences for localized relevance
• Personalization engines for promotions, content, and pricing
• Zero dead-ends in digital navigation (no more “no results” pages)

If your site or app isn’t delivering on these basics, agentic tools like AI-powered stylists or shopping concierges will struggle to deliver true value.

Dual-Track Strategy: One for Today, One for Tomorrow

The most successful retail organizations—labeled Achievers in the report—follow a dual-track approach:

1. Accelerate the essentials to drive short-term conversion and loyalty
2. Explore agentic frontiers to define long-term differentiation

Companies like Walmart, Amazon, and Zalando are already beta-testing agentic experiences like guided selling and personalized shopping assistants. But they didn’t start there. They built up to it with a robust foundation that ensures new AI layers work seamlessly with their core experiences.

Strategic Leadership Matters Now More Than Ever

AI won’t replace retail leaders—but it will replace those who fail to lead with vision, discipline, and focus. The data confirms:

• Only 30% of companies have implemented more than half of the essential capabilities
• Just 5% have mastered all foundational elements
• The implementation gap in agentic AI is even wider—only 19% of mass merchants have deployed tools like Guided Selling or Interactive Q&A

That’s a wake-up call.

Retail leadership in 2025-26 demands:

• Clear AI roadmaps that balance experimentation with operational readiness
• Deep investment in data quality and governance
• Cross-functional collaboration between merchants, marketers, and technologists
• Relentless focus on the customer problem being solved, not just the tool being deployed

Final Thought: AI Is a Leadership Issue, Not Just a Tech One

As a consultant and retail strategist, I often remind clients: technology doesn’t transform companies—leaders do. The AI transformation sweeping across our industry will reward those who stay grounded in customer value, executional excellence, and ethical clarity.

The opportunity is enormous. So is the responsibility.

Let’s lead well.

To obtain a copy of the Lucidworks Generative AI Benchmark Report, click here