By Lin Lili, People’s Daily
China’s retail sector is embracing AI through diverse innovations. In stores equipped with AI-enabled interactive shelves, picking up a product triggers a digital display that introduces its features and functions. In restaurants, AI-powered inspection tools automatically detect whether kitchen staff have washed their hands and monitor inventory in real time. In unmanned stores, computer vision and sensor-equipped shelves accurately track product selection, enabling customers to simply pick up items and walk out after paying via facial recognition or QR code scans.
At the 2025 China Shop, the largest retail exhibition in Asia, AI’s presence was seen throughout the retail ecosystem. Technologies ranged from smart shelving and cold-chain logistics to unmanned vehicles and drones, as well as data analytics platforms that interpret consumer behavior and automate responses. This technological integration is fundamentally transforming retail operations while redefining the consumer experience.
China is advancing AI-consumption integration as a strategic component of its digital economy development. This approach enriches the AI application scenarios while creating new avenues for expanding domestic demand. By deploying AI, virtual reality, and big data technologies across consumer sectors, the country enhances supply-demand alignment, boosting consumer confidence with more personalized, responsive services.
As China has moved beyond the era of “shortage economy,” the central question in retail business becomes what compels consumers to willingly spend in today’s market?
A key shift in modern retail is the transition from product-centered to user-centered models. Younger consumers, who grew up in the digital age, now drive market trends. Retailers must offer more personalized, immediate experiences to meet rising expectations.
For example, some beauty stores now use AI-enabled shelves that respond to voice commands, helping shoppers find and select suitable products. E-commerce platforms are also rolling out virtual fitting rooms and 3D previews to simulate “try-before-you-buy” experiences.
With the integration of AI, retailers can deliver customized recommendations, targeted promotions, and flexible payment and delivery options, putting the users truly at the center of the retail journey.
Big data and AI are also transforming supply chains by bridging the gap between consumer data and production insights. Through precise user profiling, companies can better match supply with demand. One example is the rise of C2M (Customer-to-Manufacturer) models, where businesses collect consumers’ personalized preferences and convert them into tailored product designs. This helps resolve the long-standing tension between mass production and personalized customization. In this way, “AI + consumption” creates a closed data loop that allows demand to guide supply, reinforcing a two-way cycle of value creation.
AI is not only reshaping front-end consumer interactions but is also redefining value across the entire retail chain. Traditional retail structures centered on people, goods, and spaces are evolving into intelligent retail ecosystems. With AI tools, manufacturers, logistics providers, and retailers can connect seamlessly across both online and offline channels. From product development and marketing to process optimization and inventory management, AI dramatically improves supply chain efficiency and responsiveness.
China’s consumer market boasts vast potential, backed by a population of over 1.4 billion, including more than 400 million middle-income earners, and a robust manufacturing base. The country produces more than 220 types of industrial goods at world-leading volumes and is the only nation to encompass all categories in the United Nations industrial classification system.
As AI integrates more deeply into the economy, it will more effectively align China’s unmatched production capabilities with its enormous consumer base, unlocking new opportunities of growth and unleashing even greater consumption potential.
