AI

Agentic AI, frontier firms and the retail race to relevance

AI visibility will depend on what information exists across the internet, not just what exists on your own website. Brand reputation is becoming machine-readable and AI agents may become one of the most important audiences you serve.

Adobe Stock

September 1, 2026 | Rob Want, Enterprise Retail & Consumer Goods Industry Technical Strategist at Avanade

Summarize with

The conversation in retail or consumer goods has changed dramatically over the past 12 months.

Not long ago, the focus was on whether AI would be adopted. Today, that question has largely been answered. AI adoption is happening at a pace that exceeds almost every technology wave that came before it. PCs took years to reach mass adoption. The internet accelerated that timeline. Generative AI has moved even faster.

Moving from AI experimentation to becoming a true frontier firm is where the industry is heading and where real business value will be created.

Your next customer might be an AI agent

Retailers traditionally focus on influencing people. Increasingly, retailers must influence both people and the AI agents acting on their behalf. Consumers are already using AI to:

Research products.
Compare options.
Evaluate brands.
Find the best place to purchase.
Obtain post-purchase support.

The level of delegation is particularly high in the early stages of the buying journey, where consumers are deciding what to buy and evaluating alternatives, which creates an entirely new challenge for brands.

AI visibility will depend on what information exists across the internet, not just what exists on your own website. Reviews, articles, community discussions, product data, expert opinions and customer experiences can all influence what an AI agent recommends. Brand reputation is becoming machine-readable and AI agents may become one of the most important audiences you serve.

The frontier firm journey isn't a technology project

One of the biggest misconceptions is the belief that becoming a frontier firm is primarily an IT initiative, it isn't. It's a business transformation initiative enabled by technology.

A frontier firm generally progresses through three stages:

Stage 1: Human with AI Assistant
This is where many organizations are today. Employees use copilots and assistants to help complete individual tasks faster and more effectively. This stage is already becoming table stakes. Organizations that have not yet started here risk falling behind.

Stage 2: Human-Led, Agent-Assisted
In this model, individuals leverage multiple agents simultaneously, similar to managing a team. You start one agent on research, another on analysis, and a third on content generation. You monitor the work, validate outputs, provide feedback, and redirect effort as needed. Managing four productive agents can feel surprisingly similar to managing four employees.

Stage 3: Human-Led, Agent-Operated
This is where organizations begin orchestrating networks of agents that execute large portions of business operations autonomously while humans provide objectives, governance, oversight, and strategy.

Most companies are still in the first two stages, and that is completely normal. Companies will need to progress through the stages as their AI maturity grows. You can't skip directly to the end state, there are valuable lessons learned in the process.

Why most retail AI programs stall

Many organizations are currently in the experimentation phase. Each department builds their own agents: Marketing, supply chain, legal, merchandising, so on and so forth. Everyone is innovating, which is good. But too often these initiatives remain isolated from broader business strategy.

Eventually leadership faces a new challenge: You now have 100 agent ideas and resources to build only 10. Without governance and prioritization, organizations become trapped in endless experimentation. The leaders pulling ahead are taking a different approach. They start with strategic priorities first. Then they identify the business processes that support those priorities. Only then do they develop agents.

It is vital to start with your strategic priorities. These priorities will map to business processes that are needed to drive success. The Agents aligned strategy will return the highest overall value. The agents become a means to an end and not the end itself.

The most exciting opportunities are cross-functional

The future isn't a collection of disconnected agents. It's a coordinated network of agents operating across business functions. Imagine an inventory management agent that determines seasonal jackets are unlikely to sell before the end of the season. That insight could automatically trigger:

A merchandising agent to create a promotion.
A supply chain agent to transfer inventory to stronger-performing locations.
A planning agent to adjust forecasts.
A finance agent to estimate margin impacts.

No single department operates in isolation. The biggest value opportunities emerge when Agents also collaborate across the company.

The iceberg most companies don't see

When executives discuss AI, they often focus on the visible elements:

Large language models.
Agent platforms.
Copilots.
New technology releases.

That's the tip of the iceberg. Beneath the surface lie the factors that often determine success or failure:

Leadership ownership: AI cannot be delegated entirely to IT. Business leadership must own the transformation.
Data readiness: AI is only as effective as the data it can access. If critical information is fragmented, inaccessible, or trapped in legacy systems, agent performance will suffer.
Data governance: As agents gain access to enterprise knowledge, organizations must ensure access controls, classification policies, and security measures are in place.
Process maturity: You cannot effectively automate a process you don't understand. Organizations with clearly documented business processes move faster and achieve stronger outcomes.
Workforce readiness: Employees need confidence, skills, and trust in AI systems. If they don't trust the outputs, adoption will stall regardless of technical capability.
Responsible AI: Privacy, fairness, security, and ethical considerations are not optional. They are foundational to sustainable adoption.

A new era of retail competition

The retailers that win will be the ones that operate AI effectively. That means aligning agents to business strategy, investing in data foundations and redesigning processes instead of simply automating existing inefficiencies.

Your brand is no longer competing only for a consumer's attention. You are competing for the recommendation of that consumer's AI agent.