Rise of generative AI in retail in spotlight at Global Sourcing Expo

Like any disruptive technology, Artificial Intelligence (AI) brings both opportunities and challenges for individuals and businesses – requiring a careful balancing act between the two, especially in the context of the retail industry.

Recognising this, the recently concluded Global Sourcing Expo Sydney hosted a well-attended seminar on AI Risks and Opportunities in Retail, featuring representatives from Bird & Bird, one of the world’s leading law firms.

Of particular interest to Bird & Bird is the rise of generative AI: AI capable of generating text, images, videos, or other data using generative models through the use of specialised prompts. Generative AI models learn the patterns and structures of inputted data to generate new data that has similar characteristics.

“The Global Sourcing Expo’s Sourcing Seminar Series is intended to give industry professionals who work across all stages of the global sourcing supply chain practical resources to navigate their sourcing journey,” shares Marie Kinsella, CEO, International Expo Group and organiser of the Global Sourcing Expo. “Emerging technology tools such as AI are a major focus area for many of our attendees and following the overwhelmingly positive reception to the Bird & Bird seminar, we look forward to revisiting the topic of AI at the upcoming Melbourne Global Sourcing Expo this November.”

Over the course of the one-hour seminar, Bird & Bird’s Shariqa Mestroni (Special Counsel), James Hoy (Special Counsel) and Jessica Laverty (Senior Associate) discussed the increasingly prevalent role that generative AI is playing in the retail sector, outlining the various ways that businesses are leveraging this technology. These include:

- Product Development and Innovation: generative AI assists in writing briefs for product collections and generates mood boards and visual imagery.

- Descriptive Writing for websites.

- Marketing Projects: Hyper-personalisation for loyalty programs, trend forecasting and creating marketing campaigns.

- Product and Service Design.

- Customer Support Chatbots.

“Retailers are also using other forms of AI to assist with supply chains and logistics through real-time demand forecasting and stock management,” shares Jessica Laverty. “However, the opportunities unlocked by AI must still be balanced against risks such as copyright infringement and data protection concerns.”

How Australia regulates AI

Jessica shares that in Australia, AI (including generative AI) is regulated by existing legislation covering consumer rights, data protection, competition, and copyright.

“Although there is no specific AI legislation, the Australian Government encourages responsible AI deployment. One way that organisations can achieve this is by following Australia’s voluntary AI Ethics Framework. They are establishing a Select Committee on Adopting Artificial Intelligence and have allocated $39.9 million towards AI technology development over the next five years.”

It’s important to note that Australia does have a robust Privacy Act, which sets out several Australian Privacy Principles (APPs). The APPs apply to all Australian organisations and businesses and govern the collection and use of personal data.

Retailers who wish to use a generative AI but still adhere to the APPs should keep the following key considerations in mind:

- Transparency:  Check whether any collection, use, and disclosure of personal information by the generative AI system is clearly disclosed in your organisation’s privacy policy.

- Collection: Ensure that the collection of personal information is lawful, fair, and directly from the individuals themselves (unless impracticable).

- Use and Consent:  Examine whether the generative AI system uses or discloses personal information for secondary purposes and obtain user consent if so.

- Integrity: Safeguard the security of personal information stored in the system and follow proper procedures for destruction or de-identification.

- Individual Rights: Establish a mechanism for handling requests by individuals for the access or correction of personal information held in the AI system. Respect individual rights and privacy.

The IP implications of generative AI and key recommendations for retailers

Furthermore, Jessica stresses that the rise of generative AI has raised questions about traditional Intellectual Property (IP) rights.

“An increasing number of content creators are becoming concerned about the misuse of their material by generative AI tools. For retailers to avoid potential copyright infringement claims, they need to ensure that their AI training data derives from unlicensed content. AI-generated content should also ideally include information about its origin and the sources used in training.”

To summarise, retailers using generative AI need to be diligent about compliance with intellectual property laws, ensure “clean” training data, and develop ways to demonstrate the provenance of generated content.

Jessica shares that as best practice, businesses must establish robust AI policies for their employees with clear prohibitions and guardrails, with employees receiving regular training around the use of AI tools in line with said policy.

“As AI continues to evolve, legal frameworks are beginning to adapt to address these complex issues. Retailers who wish to integrate AI tools into their business must carefully review the terms and conditions of their AI tool of choice to mitigate any potential legal risks and consult with a legal professional as needed to ensure compliance,” she concludes.

The next edition of the Global Sourcing Seminar Series will take place at Global Sourcing Expo Melbourne at the Melbourne Convention & Exhibition Centre from 19-21 November 2024, with topics ranging from new technologies, the recycling phenomenon to sustainability in fashion.

Note: The content of this press release has not been edited by Fibre2Fashion staff.

Fibre2Fashion News Desk (HU)