AI-driven retail: How H&M Group does it (2024)

Fashion retailers are increasingly turning to artificial intelligence (AI) for help in the quest to give customers what they want. AI-driven retail enables brands to compete in the economy of the 21st century and meet modern customer demands by personalizing the shopping experience.

As more retail companies are taking their business from the traditional brick and mortar retail stores into e-commerce, they are able to get more insight into their customers’ preferences to serve the demand.

Talking about AI in retail brings us to one of the most beloved brands in the fashion industry — H&M.

H&M Group and their AI-driven story

H&M Group has been heavily investing in artificial intelligence to stay on top of fashion cycles, and also to support its massive growth.

From their beginning in 1947, the fashion retailer followed rapid expansion across Europe, U.S. and globally. And as early as 1998 they began to sell online.

Just in 2004, H&M held more than 1,000 stores, a number which grew exponentially to nearly 5,000 stores in 72 countries worldwide. And as of today, the retail giant employs 177,000 people and contributes to 1.6 million jobs for people employed by their suppliers.

But how does a brand manager sustain this kind of growth, reaching across different countries, markets and even continents? How do they make sure they meet the needs of such a huge base of customers with different shopping needs and expectations? And most importantly, how do they manage to run thousands of stores worldwide?

The man who has answers for all these questions is Errol Koolmeister, H&M Group’s Product Area Lead Engineer AI Foundation at H&M Group. During his talk at the Data Innovation Summit 2019, he explained that they first started adopting AI into their business in 2016. The impact of digitalization was clearly visible and H&M Group knew they had to do something in order to stay relevant.“We, as a company, and as…