In the corridors of the world’s largest retail chains, a quiet revolution is taking place. It is not being driven by weekend promotions or ambitious store expansion plans, but by algorithms.
A report published in April 2026 by McKinsey & Company in partnership with ICSC confirms what many industry leaders have suspected for some time: artificial intelligence is fundamentally reshaping the retail industry.
Titled Shopping in the Age of AI: Redefining Stores for a New Era, the report draws on a survey of more than 3,000 US consumers, alongside interviews with executives from the retail and commercial property sectors. Its conclusion is clear. The physical store is not disappearing, but evolving rapidly. Retailers that fail to understand this transformation risk losing relevance in a market increasingly shaped by intelligent technology.
For Africa, where retail is expanding alongside rapid urbanisation and digital adoption, the findings carry particular significance.
Trillions at Stake
One figure stands out above all others in the report. McKinsey estimates that agentic commerce could generate as much as $1tn in additional revenue in the US B2C retail market alone by 2030. Globally, the opportunity could reach between $3tn and $5tn.
Agentic commerce refers to AI systems capable of acting on behalf of consumers. These systems can search for products, compare prices, make purchasing decisions and even manage returns with minimal human intervention. AI-powered assistants and shopping agents are becoming increasingly influential intermediaries between brands and consumers.
According to the survey, 68% of consumers have used at least one AI-powered tool during their shopping journey within the past three months. Among those users, 62% relied on AI to compare brands and prices, while 54% used it to better understand products before making a purchase.
Africa is particularly well positioned to benefit from this shift. The continent combines one of the world’s youngest populations with rapidly growing smartphone penetration and a deeply mobile-first consumer culture. In many African markets, consumers have embraced digital payments and mobile commerce far faster than traditional retail infrastructure has developed.
The conditions for rapid AI adoption already exist. The question is whether African retailers are prepared to capitalise on them.
The New Battle for Physical Retail
The report argues that physical retail is splitting into two distinct models.
The first is the convenience store: a format focused on speed, efficiency, product availability and frictionless shopping. The second is the discovery store, designed around experience, entertainment, emotion and personalisation.
Consumers increasingly expect retailers to excel in one of these areas rather than attempting to do both. McKinsey found that 37% of consumers rank reliable stock availability as a key reason for remaining loyal to convenience-focused retailers. Meanwhile, more than 40% of Gen Z and Millennial shoppers say immersive and experiential retail environments make them more likely to visit and buy from a brand.
This distinction matters because the rewards are becoming increasingly concentrated among market leaders. McKinsey estimates that top-performing retailers will capture more than 85% of the sector’s economic profit over the coming years. Retailers without a clearly defined positioning risk rapid marginalisation.
Africa’s Retail Opportunity
Africa is far from a passive observer in this transformation. Across the continent, retail ecosystems are evolving quickly in response to demographic growth, urban expansion and changing consumer expectations.
Several themes identified in the McKinsey report align closely with realities already visible in African markets.
The first is the rise of mobile-first shopping. In many African countries, the smartphone remains the primary gateway to the internet. AI-powered retail assistants delivered through mobile applications could therefore see particularly rapid adoption among urban consumers.
The second is the growth of experiential retail. Cities such as Nairobi, Lagos, Abidjan and Casablanca are already seeing the emergence of modern retail destinations that blend shopping, entertainment and lifestyle experiences.
Developments such as Two Rivers Mall and Mall of Africa reflect precisely the kind of “discovery destination” model highlighted in the report.
The third opportunity lies in supply chain optimisation. Product shortages and stock-outs remain a persistent frustration for many African consumers. If stock availability is already a decisive factor in mature retail markets, its importance is likely even greater across Africa. AI-driven inventory and logistics systems could therefore deliver immediate and measurable improvements in customer satisfaction.
Finally, the report highlights the growing importance of personalisation. As African consumers become more informed and digitally connected, retailers that use AI to tailor recommendations, promotions and customer experiences are likely to gain a significant competitive advantage over rivals still relying on generic mass-market approaches.
What African Retailers Must Do
The report offers several lessons for African retailers seeking to remain competitive in an increasingly intelligent retail landscape.
First, retailers must clearly define the role of each store format. Is a store designed primarily for convenience and efficiency, or for discovery and engagement? That decision should shape everything from technology investments to store design and staff training.
Second, investment in intelligent retail technology is no longer optional. AI tools for inventory management, customer analytics and personalised marketing are becoming increasingly affordable and accessible, including through African technology start-ups building localised solutions for regional markets.
Third, retailers must focus on winning the loyalty of younger consumers. African Gen Z shoppers share many of the same expectations as their global counterparts: authenticity, engagement, convenience and experience. Brands that understand these priorities will be better positioned for long-term growth.
Finally, shopping centre developers and commercial property owners must rethink the role of retail destinations. Successful malls of the future will increasingly combine shopping with dining, entertainment, wellness and social experiences, creating multifunctional urban hubs rather than purely transactional spaces.
A Defining Moment
The global retail industry has often evolved without Africa at its centre. Yet the rise of AI-driven commerce presents the continent with a rare opportunity to leapfrog older models and build a more agile, digitally integrated retail ecosystem from the outset.
African retail technology companies, particularly those focused on logistics, payments, customer loyalty and inventory management, could become central players in this transition. Investors, entrepreneurs and policymakers all have a role to play in ensuring that the transformation is both rapid and inclusive.
If agentic AI does indeed unlock trillions of dollars in global retail value over the next decade, Africa cannot afford to remain on the sidelines.
The question is no longer whether AI will transform retail on the continent. It is whether African businesses will help shape that transformation, or simply watch it unfold elsewhere.