What 10 UK Retail and Data Experts Predict for AI and Data in 2025: Challenges and Opportunities
Table of Contents
Estimated Reading: 8 minutes
Post Author: Giuseppe IafulliReviewed By: Cory Anderson
U.K. inflation rates may have eased from their 2022 spike, but many consumers are still feeling the squeeze. Higher prices have made shoppers more budget-conscious, carefully balancing essential purchases with selective splurges
According to McKinsey & Company research, 53% of consumers still cite rising costs as a top concern, reflecting a cautionary mindset that will continue to shape retail trends in 2025.
This heightened consumer scepticism poses a significant challenge for retailers striving to win wallet share while navigating their own inflation-related pressures. To stay competitive, they must build trust, embrace innovation, and deliver exceptional shopping experiences—or risk being left behind.
To help unpack what lies ahead, we spoke to 10 leading retail, data, and AI experts to understand the key opportunities and challenges awaiting U.K. businesses in 2025. From hyper-personalisation to smarter marketing strategies, here’s what they had to say about shaping the future of retail in a challenging, yet opportunity-filled, market.
Table of Contents
The High Stakes of 2025: A Tough Market Requires Smarter Strategies
Opportunities: Personalisation, Marketing Attribution, Advanced Demand Forecasting and beyond
Challenges: From Data Quality to Organisational Buy-In
Reimagining U.K. Retail with AI
Preparing for 2025: Actionable Steps for U.K. Retailers
Conclusion
Learn More About AI in Retail
1. The High Stakes of 2025: A Tough Market Requires Smarter Strategies
2025 is a year expected to be shaped by significant shifts in consumer expectations and economic pressures. Budget-conscious shoppers will expect more value than ever, and brands will face intense competition for limited discretionary spending.
As Chris Penn, Co-Founder and Chief Data Scientist at TrustInsights.ai, explains:
“AI will emerge as the game-changer. It won’t just enhance efficiency but also empower retailers to personalise, predict, and pivot like never before. This isn’t just about weathering economic challenges—it’s about rethinking retail operations entirely. Retailers will need to ‘do more with less,’ question every aspect of their operations, and reimagine how they connect with consumers. The brands that don’t adapt risk falling behind in an unpredictable market.”
– Chris Penn, Co-Founder and Chief Data Scientist at TrustInsights.ai
2. Opportunities: Personalisation, Marketing Attribution, Advanced Demand Forecasting and beyond
AI and data are unlocking unparalleled opportunities for U.K. retailers to deliver better customer experiences, optimise operations, and improve decision-making. Here are some of the standout opportunities experts foresee:
Hyper-Personalisation at Scale
Consumers increasingly expect shopping experiences that are tailored to their needs.
As Hazel Finlayson, Head of Data at Bella & Duke, puts it:
” The main opportunities that I see Data & AI enabling in 2025 are personalisation and leaning into the subconscious commerce/marketing trend. Consumers’ expectations around personalisation are increasing, and we really need to make sure they see the value in sharing their data with retailers. AI makes it easier for data teams to enable personalisation, moving beyond generic recommendations to offer seamless, highly personalised experiences. This builds loyalty, boosts sales, and improves operational efficiency.”
– Hazel Finlayson, Head of Data at Bella & Duke
Mark Bell, head of experience at iCrossing says:
“In 2025 Data and AI will continue to offer an ever more frictionless shopping experience where purchase decisions become easier through hyper-personalisation, predictive insights, and automation.
However, the biggest challenge in tapping into these opportunities is knowing where to start, ensuring your data is in the right place, of the right quality, and defining the most relevant opportunity where AI can make a difference.
In 2024, AI has already helped build foundational frameworks and optimize processes. By 2025, AI will drive full integration into decision-making, enabling cross-channel alignment and agility to adapt to evolving trends.”
– Mark Bell, head of experience at iCrossing
Retailers can use AI to anticipate customer preferences, refine product recommendations, and even adapt in real-time to shifting behaviours. The payoff? Increased customer loyalty and long-term profitability.
Smarter Marketing Attribution
Many retailers still struggle with understanding the true impact of their marketing efforts.
Yannick Barriol, Fractional CMO and retail expert, highlights the importance of adopting a data driven-data driven media mix modelling:
“Too many retailers’ marketing mix is heavily reliant on performance channels like Meta and Google and they are hitting a ceiling in growth and efficiency but are held back by bad measurement.
In 2025, more players will adopt data-driven media mix modelling to break through this ceiling by investing more in the top of the funnel, and capture incremental revenue.”
– Yannick Barriol, Fractional CMO and retail expert
For U.K. retailers, this shift could mean moving away from the current reliance on Google and Meta ads and exploring sustainable strategies to maximise ROI.
Advanced Analytics and Forecasting
Traditional inventory management and planning methods are becoming less effective in a fast-changing market.
Kate Warner, Former CFO at SunGod, sees AI playing a crucial role:
“Data and AI advancements are evolving rapidly, and i believe in 2025 we will see more of it.
Main uses I see are through full-funnel marketing strategies to get better ROAS and improved inventory forecasting for optimal working capital.“
– Kate Warner, Retail expert and CFO
3. Challenges: From Data Quality to Organisational Buy-In
While the opportunities are vast, experts caution that implementing AI is no easy task. Retailers will face several challenges, including:
Building Trust and Transparency
Data transparency will be critical in winning over both consumers and employees.
“Our primary goal in 2025 is to move our department one step further along the data maturity curve. We aim to shift from descriptive analytics to diagnostic analytics, helping us better understand the “whys” behind the data. The main challenge we are facing to achieve this is data quality, which has now become a key focus for the team. Although we are still at the beginning of our AI journey, it is already helping in small ways, such as helping us troubleshoot and optimize SQL queries.
We foresee AI playing an increasingly bigger part in our operations going forward, such as in our marketing automation to enhance customer journeys.’
Beth Heddle, a marketing consultant and retail expert, warns:
“Looking to 2025, I see immense opportunities in using AI for hyper-personalisation and optimising supply chains but also huge threats”
Retailers will be able to make real-time decisions based on consumer behaviour, resulting in more efficient and tailored shopping experiences. One of the main challenges, however, will be handling the growing need for data transparency and security without stifling innovation.
AI’s role in many brand’s data strategies for 2024 has already been significant, driving them to expand data collection and analytics capabilities. In 2025, brands will need to look at how they make processes more agile and scalable, leveraging AI to adapt to changing consumer demands.”
– Beth Heddle, marketing consultant and retail expert
Fixing Data Quality Issues
Many U.K. retailers are still grappling with fragmented systems and inconsistent data.
Matt Sawyer, Founder of SawInsight, explains:
“In 2025, the biggest challenge for data and AI will be ensuring data quality at the source. Many organisations still struggle with fragmented data systems and inconsistent data, which delays the ability to deliver real value. Ensuring that data is fit for purpose from the outset is critical to the success of AI and analytics projects.
The key opportunity lies in modernising data infrastructure—using solutions like modern ELT platforms, low-code platforms that scale seamlessly, or pre-built AI models to accelerate time to value. This will simplify integration and modelling, allowing businesses to focus on actionable insights rather than data preparation.
Organisations that invest in robust, scalable data systems will unlock the full potential of AI, while those that fail to do so will struggle to stay competitive.”
– Matt Sawyer, Founder of SawInsight
Philipp Bishop, Data and Analytics Manager at Fortescue Zero said:
“AI is transitioning from a specialism into a widely available commodity, empowering those closest to the business opportunities. This is exciting as the power of data and AI continues to move closer to the business context, fostering rapid innovation.
The key to capitalising on these opportunities comes down to being able to successfully identify valuable, high-impact use cases that lead to tangible business outcomes. Areas I think will see significant benefits are across supply chain, sustainability initiative and logistics.
However, the foundation for success will be robust data management and governance. Without high-quality, well-governed data, even the most advanced AI systems will fail to deliver their potential.”
– Philip Bishop, Data and Analytics Manager at Fortescue Zero
Creating a Culture of Innovation
The adoption of AI requires not only technological investment but also cultural change.
Nicolaj Foldager, CFO of Trendhim, says:
“I believe we’ve only scratched the surface when it comes to AI-driven advancements like automated email flows, customer service ticket assistance, content generation, initial data reporting, advanced inventory management, and more. The potential is vast, and we’re just getting started.
The biggest challenge is embedding AI into the organisation’s culture. Empowering teams to identify strong business cases locally while maintaining centralised guidance will be key to success.”
– Nicolaj Foldager, CFO of Trendhim
4. Reimagining U.K. Retail with AI
AI will not just augment retail—it will transform it. Experts agree that AI adoption will redefine key areas of the industry, including:
Operational Efficiency: Advanced AI models will automate repetitive tasks, freeing up resources for strategic priorities.
Smarter Marketing: AI will enable deeper analysis of vast datasets, improving marketing attribution across full-channel campaigns. This opens opportunities to scale non-digital marketing channels, ensuring a more cohesive and impactful approach to customer engagement.
Customer Experience: Retailers will use AI-driven tools to enhance personalisation and streamline the shopping journey, creating moments of delight for customers.
Demand Forecasting: AI-powered predictive analytics will enable retailers to anticipate demand with greater accuracy, optimising inventory, reducing waste, and ensuring the right products are available at the right time.
As Andrew Jenkins, Head of Data at TravelChapter, puts it succinctly:
“In 2025, data and AI present businesses with opportunities to drive personalised customer experiences, optimise operations, and enable automated decision-making and insights.
AI should be an enabler that drives innovation and decision-making, not just a cost-saving tool. With proper governance, businesses can unlock its true potential.”
– Andrew Jenkins, Head of Data at TravelChapter,
5. Preparing for 2025: Actionable Steps for U.K. Retailers
As we move towards 2025, here are six actionable steps for U.K. retailers to future-proof their strategies:
1. Invest in Scalable Data Infrastructure : Retailers must prioritise data quality and governance, ensuring their data is clean, secure, and accessible to fully leverage the potential of AI tools.
2. Review Current AI Capabilities: Evaluate existing AI tools and platforms to understand their effectiveness and identify gaps that need addressing.
3. Identify Key Opportunity Areas where AI can Deliver More Value to Customers : Pinpoint areas where AI can enhance the customer experience, such as personalised recommendations, improved service, or seamless omnichannel shopping.
4. Start Planning for Necessary Resources Now: Proactively allocate budgets, manpower, and technology to ensure a smooth and timely implementation of AI-driven initiatives.
5. Investigate the Possibility of Integrating Prebuilt Data Models: Explore ready-made AI models that can be adapted to your needs, accelerating deployment and maximising impact with minimal development effort.
6. Evaluate Whether Hiring Experts Will Generate Higher ROI: If internal expertise is lacking, assess whether hiring external specialists may deliver better returns and enable faster execution of AI strategies.
Conclusion: Thriving in a Competitive Market
The U.K. retail landscape in 2025 will be defined by tough competition, price-sensitive consumers, and the increasing need for agility.
As Andrew Thomas, CEO of Kleene.ai, reminds us:
“By 2025, data and AI will be at the heart of retail transformation, driving efficiency and personalisation on an unprecedented scale.
However, the challenges already evident in 2024 remain: integrating fragmented data systems, ensuring data quality, and fostering trust in AI recommendations. As AI becomes a fundamental part of retailers’ strategies, it is increasingly clear that data serves as the foundation of these efforts. Without a solid data infrastructure, no AI strategy can succeed.
To overcome these challenges, retailers must invest in scalable infrastructure, foster cross-functional collaboration, and develop talent capable of translating insights into actionable strategies. Success will hinge on their ability to embrace change while maintaining a customer-centric approach. Those who adapt will lead the market with unparalleled agility, optimising resources while delivering personalised, seamless shopping experiences that foster loyalty and drive growth in the e-commerce era”
– Andrew Thomas, Co-Founder Kleene.ai
The opportunities are immense, stakes even higher. With AI as an ally, U.K. retailers can not only weather the challenges ahead but emerge stronger, delivering exceptional experiences that win customer loyalty and drive growth in a rapidly evolving market.
Learn More About AI in Retail
To dive deeper into the practical applications of AI in marketing, supply chain, and finance, check out our recent webinar featuring Kleene.ai CEO Andrew Thomas as he shares actionable insights and real-world examples that can help you get ahead of the curve in 2025.
