How corporate venture building helps retailers win in an AI world

Corporate venture building helps retailers respond to AI-driven changes by converting strategic assets into new, scalable growth.

In brief

• AI is disrupting how consumers discover, decide and buy in retail.
• Corporate venture building provides a repeatable path from AI disruption to growth.

AI is reshaping the retail landscape, from how consumers discover and buy products to how retailers operate and compete. It is the latest in a long series of disruptions that have hit the slow-growth retail landscape in recent years.

But while AI is accelerating change, it alone will not be the foundation of a lasting advantage. The retailers that win will be those that translate disruption into new business and operating models, not just incremental iterations of existing models. Corporate venture building can allow retailers to capitalize on the assets they already have — such as customer relationships and data, robust supply chains and knowledgeable sales staff — and turn disruption into new business opportunities.

An urgent need for new growth

This approach is more urgent today, and retailers must apply organic growth muscles more deliberately to remain competitive. Cost-of-living concerns continue to mount for US consumers, and discretionary spending is being reduced. A new EY-Parthenon Consumer Sentiment survey finds that most US households feel squeezed by inflation, and many are coping by spending less on restaurants, vitamins and home improvement. The way that consumers discover, decide and buy is also being rewritten with the introduction of AI. AI chatbots are second only to word of mouth as a source for purchase research, according to the survey, and most respondents said they use AI tools at least once a week to help decide what to buy.

How AI is changing the consumer journey

AI is fundamentally reshaping how consumers find, evaluate and purchase products. AI-powered assistants increasingly guide discovery and comparison, while agentic capabilities allow parts of the journey to be executed on the consumer’s behalf. In a recent EY survey of retailers, nearly 60% of consumers have already used AI to support shopping decisions, and a growing share say they expect AI to be embedded across the customer journey. As comfort with chat-based and agent-led experiences grows, AI is emerging as a primary gateway to retail.

The result is a compression and reordering of the traditional purchase funnel. Generative AI (GenAI) is influencing awareness and consideration by curating options, filtering alternatives and shaping which brands are even evaluated. Agentic AI extends this shift by automating downstream actions — final selection, payment and order tracking — reducing the number of human decision points. Inclusion in the AI-mediated consideration set is becoming the most critical battleground for retailers.

Beyond purchase, AI is redefining post-sale engagement and loyalty. Consumers increasingly expect seamless visibility into delivery, returns and service through unified interfaces, while AI-powered support reduces friction and resolution time. As consumers delegate more decisions to AI systems, loyalty is no longer driven solely by human preference, but by how effectively retailers’ offerings are surfaced, recommended and executed by AI. These shifts require not only new AI-powered products and experiences, but also new operating models. These models must bring together data, technology, merchandising, supply chain and store operations around unified consumer decisioning.

Retailers must leverage their strategic assets

The good news is that retailers enter this next phase with advantages that AI-native entrants will struggle to replicate. Chief among these is the direct relationship with consumers, which creates trust, ongoing engagement and access to rich first-party data. Loyalty ecosystems and operational scale are also among the advantages retailers can leverage. As AI takes on more of the shopping journey, owning this relationship becomes increasingly important for shaping experiences and capturing long-term customer value.

Unified behavioral and transactional data enables personalization, assortment optimization and pricing precision, while loyalty programs reduce reacquisition costs and support rapid scaling of new offerings. Combined with broad product catalogs, pricing intelligence, resilient supply chains, physical stores and skilled associates, retailers possess a powerful set of endowments. When deliberately combined, these assets form the foundation for differentiated, venture-led growth. Venture building provides the structure to activate these endowments cohesively rather than through isolated initiatives.

Turning corporate endowments into P&L-backed growth engines

Corporate venture building starts with these relationships and other assets retailers already have — first-party data, brands, stores, supply chains — and uses them to create new value, operating models and businesses. That value can take the form of new businesses or new operating models that reorganize how the enterprise works: decisioning models for personalization, integrated supply chain orchestration or new service platforms that extend beyond the core retail offering. Each venture, whether a new business or a new operating model, is grounded in a clear economic thesis with measurable revenue, cost or margin impact.

A key difference in this approach is its ability to orchestrate capabilities around a desired result. Rather than deploying isolated AI solutions, venture teams align strategy, product, data, engineering, operations and go-to-market around a single commercial objective. Ring-fenced teams, rapid experimentation and clear ownership help retailers move beyond pilots and translate innovation into scalable, measurable business impact.

Treating the enterprise as “customer zero”

As retailers invest in AI-enabled decisioning across merchandising, pricing, supply chain and customer engagement, a new growth pattern is emerging — one that EY-Parthenon teams are seeing across consumer and retail, financial services and adjacent sectors.

In several engagements, large enterprises have built advanced digital and AI capabilities to improve their own performance, only to realize that these capabilities are scarce, highly valued and largely inaccessible to smaller players across the value chain. Independent retailers, brands and other value chain participants face the same AI-driven disruption, but often lack the scale, data or capital to develop these capabilities themselves.

The strategic shift comes when the enterprise treats itself as “customer zero.” Capabilities are first deployed internally and tested under real operating conditions, then refined at scale and proven to deliver measurable impact. From there, they are deliberately shaped into services or platforms that can be offered to noncompetitive segments of the market.

We see this pattern taking hold in multiple forms:

• Retailers extending internally built digital capabilities to support small and medium-sized businesses
• Consumer packaged goods companies productizing digital tools and data services for independent participants across the ecosystem
• Financial services firms developing new merchant-facing services that go beyond transactions to insight and optimization

As AI becomes table stakes, the opportunity for retailers is not only to improve internal performance, but to activate core capabilities as external growth engines — whether through insights-as-a-service, decisioning platforms or AI-enabled tools.

Venture building provides the structure to make this shift real. Ring-fenced teams, clear economic theses and early validation with external users help ensure that capabilities designed for the core enterprise can scale beyond it — creating new, asset-light revenue streams while strengthening the retailer’s role as an orchestrator of the value chain.

Actions retailers can take:

1. Monetize what you’ve already built: prove your AI and digital edge in your own operations, then sell it as a paid capability.
2. Don’t play “pilot theater”: build ventures like businesses, not monolithic pilots.
3. Gain CEO sponsorship: leaders who have responsibility for value creation can establish the mandate and ring-fenced team to allow endowments to be leveraged in new ways.

Sathyanarayanan M. contributed to this article.