2026 Connected Retail Experience Study: Retailers See AI as Key, But Execution Lags

The role of the physical retail store is constantly evolving. To engage customers in today’s omnichannel environment, going into a store has to be an experience—not just a showroom, a fulfillment center, a returns hub, and a pickup location. It has to be both seamless and personalized. We’re calling this new era the “retail renaissance.” While it creates challenges for retailers who are already having to navigate labor shortages, escalating shrinkage (inventory loss) rates, and profit margin pressures, it also opens the door to new opportunities for solving these macroeconomic challenges.

In partnership with Verizon Business and Cisco, Incisiv recently published the findings of their 2026 Connected Retail Experience Study “The New Omnichannel Imperative: AI Is Required to Compete, Yet Hard to Implement”, which highlights that the path forward for retail success lies not in any one technology, but in building a unified, connected digital platform supporting three core pillars: empowering a mobile-first workforce, closing the AI ambition-to-execution gap, and modernizing the network as the bedrock for both. The outcome is better experiences for customers, associates and business owners alike.

The mobile-first workforce is the new standard

Incisiv’s research signals a strategic shift from simply hiring more people to making every existing associate more effective. With 67% of retailers still facing hiring and retention issues, and core operational efficiency—like inventory accuracy (47%) and checkout speed (44%)—as top business priorities, technology is the primary solution for addressing labor constraints.

The study also found that retailers are realizing the benefits of mobile enablement, with the deployment of mobile tools for associates having doubled in the last two years. While core capabilities like digital push-to-talk (65% deployed) and associate Wi-Fi (64% deployed) are table stakes, the true competitive advantage is in near real-time execution tools: Mobile Inventory Tracking Apps (32% deployed) and video-based associate training (35% deployed). Associates need connectivity, information, and training delivered directly to the point of action, eliminating the need to leave the sales floor for back-office sessions or manual counts.

Equipping associates with near real-time data through tools like mobile POS, electronic shelf labels, and intelligent video is essential for operational discipline. It helps enable them to manage complex tasks like assisting customers and ensuring store fulfillment of online orders are completed promptly and accurately, which can be critical for preventing failed pickups and lost customers.

Closing the AI ambition-to-execution gap

Another key finding from the report is that enthusiasm for artificial intelligence (AI) is nearly universal, with 83% of retailers indicating that AI is a necessity to compete. However, a massive chasm exists between ambition and execution, with only 6% of retailers rating their current AI capabilities as "mature." Most are stalled in the "Exploring" (31%) or "Planning" (37%) phases.

The reasons for this gap are attributed to:

• Poor or Siloed Data: Cited by 55% as a deployment challenge
• System Integration Challenges: Cited by 48%
• Lack of Specialized Talent: Cited by 44%

Pragmatic retailers are prioritizing foundational investments first: data infrastructure (56% overall priority) and upgrading the network and compute (42%). They understand that an algorithm is only as good as the reliable and secure data feeding it.

The prioritized use cases reflect a focus on existential threats and core operations. Loss prevention and theft detection lead the charge due to rising shrink rates. Beyond that, priorities diverge:

• Grocery retailers focus on high-volume, low-margin operational use cases: inventory management, forecasting, workforce optimization, and pricing optimization.
• Specialty retailers concentrate on customer engagement: personalized product recommendations, chatbots, and customer behavior analytics.

The takeaway is that AI maturity is less about the algorithm and more about the organizational readiness and data foundation required to change how decisions are made.

Network infrastructure as a commercial driver

The third and most critical finding from Incisiv’s survey is the shift in how retailers view their network infrastructure—it is now a direct factor in commercial outcomes, not just a background utility. With 61% of retailers reporting revenue loss from slow digital experiences and 55% from in-store mobile app crashes, the network is often the bottleneck to realizing value.

This urgency is driving upgrades, with 67% of network upgrades driven by AI and machine learning applications, followed by IoT and sensor networks (56%) and computer vision (54%). These are workloads demanding high bandwidth and low latency, pushing traditional infrastructure past its limits.

The weakest point is network readiness for the edge, with only 39% of retailers satisfied with their edge computing support. This is a major issue as critical AI workloads, from near real-time video analytics for loss prevention to predictive maintenance, move closer to the store level.

To address this, a more advanced network architecture is required. Retailers are adopting solutions like 5G Business Internet, private networks, and advanced mobile connectivity to deliver the speed, bandwidth, and near real-time performance that modern, data-intensive applications require. This "pull-driven" investment is the clearest evidence that the network is an essential foundation for the digitally connected store of today and the future.

The bottom line

For retailers: The future of retail belongs to organizations that integrate their digital spending with the human element of their operations. This involves empowering associates, utilizing data for smarter choices, and establishing a fast, secure, and adaptable network to connect these components seamlessly.

For consumers: The increased focus on tech adoption will only enhance the shopping experience, turning storefronts into experience hubs.

The Connected Retail Study is now in its fifth year. To learn more, download the complete 2026 Connected Retail Experience Study.