The Impact of Artificial Intelligence on Fashion and Retail Efficiency: A Strategic Analysis

Artificial Intelligence (AI) is revolutionizing the fashion and retail industry by driving efficiency, enhancing consumer engagement, and redefining supply chain management. Through the integration of advanced automation, predictive analytics, and personalized marketing strategies, AI has enabled retailers to streamline operations, refine inventory management, and anticipate consumer preferences. This paper provides an extensive analysis of AI’s transformative effects on the fashion and retail sectors with a particular focus on automation, predictive analytics, personalized marketing, and supply chain optimization. In addition to demonstrating AI’s potential to boost productivity and profitability, the study addresses significant challenges associated with AI implementation—such as ethical concerns, regulatory frameworks, and shifts in the labor market. Case studies of leading retailers including Zara, Sephora, and Amazon are examined to explore both the tangible benefits and the inherent challenges of integrating AI technologies. The discussion further emphasizes future directions in the industry, underscoring the need for responsible AI adoption, comprehensive workforce reskilling, and strategic policymaking to foster sustainable growth (Acemoglu & Restrepo, 2020; Brynjolfsson & McAfee, 2017; European Commission, 2023; McKinsey & Company, 2023; OECD, 2022).