Singapore Retailers Embrace AI, But Trust Remains a Barrier to Full Autonomy

SINGAPORE, August 21, 2025 – Artificial intelligence (AI) is rapidly reshaping Singapore’s retail sector, with near-universal adoption across businesses, yet a significant trust gap remains over allowing the technology to operate independently. New research from global software firm monday.com reveals that 98 per cent of local retailers are exploring or deploying AI agents, but only 10 per cent trust them to manage the entire customer journey autonomously.

The survey of 350 retail decision-makers in Singapore highlights how AI is being applied across customer service (57 per cent), marketing and content creation (48 per cent), sales assistance (48 per cent), and inventory management (43 per cent). While enthusiasm is widespread, retailers continue to emphasise the need for human oversight, citing trust, complexity, and employee resistance as key barriers.

Human Oversight Still Central

The study shows that 70 per cent of retailers believe human-AI collaboration is essential to manage complex customer interactions. Only 7 per cent of respondents allow AI to make business decisions independently, with most preferring AI as an assistive tool providing actionable insights, while humans retain final authority.

“Singapore’s retailers see AI as an opportunity to deliver personalised, intelligent and faster customer experiences,” said Gavin Watson, Senior Industry Lead at monday.com. “However, to fully realise these benefits, businesses need the trust, skills, and resources to make the technology viable. Transparency in implementation is critical so that both employees and customers feel secure and empowered.”

Small Retailers Lag Behind

While larger retailers (1,000–10,000+ employees) are capitalising on AI with in-house teams and C-suite leadership, smaller businesses face greater hurdles. Among micro retailers with fewer than 10 employees, resistance from staff, limited expertise, and high costs were identified as the biggest challenges.

Only half of small retailers (up to 50 employees) believe AI can help them compete with global retail giants, compared to 94 per cent of larger businesses. Shopping centres and malls reported the highest levels of employee resistance (77 per cent), reflecting concerns about job security and lack of understanding about AI’s benefits.

“Instead of viewing resistance as a challenge, physical retailers should leverage AI to enhance the human touch. In-store experiences remain uniquely powerful, creating emotional connections no algorithm can replicate,” Watson added.

Transparency, Trust, and Sustainability

The report also highlights consumer expectations: nearly three-quarters of respondents said customers are more likely to remain loyal to brands that are transparent about how they use AI. Concerns over data privacy were especially prominent in sectors such as health and beauty, where 73 per cent identified it as a barrier to adoption.

Sustainability has emerged as another driver of AI adoption. Three-quarters of retailers said they are using AI to optimise production, reduce waste, and embrace circular economy principles, aligning with Singapore’s Green Plan and net-zero targets.

Balancing Promise with Caution

While adoption levels suggest AI is becoming mainstream in retail, monday.com’s findings underline that Singapore’s sector is likely to remain “human-led” for the foreseeable future. The research indicates that building employee trust, ensuring customer autonomy, and embedding transparency will determine how quickly retailers can scale AI beyond assistive roles.

“AI is shaping Singapore’s retail future,” Watson concluded. “But it must do so hand-in-hand with people, protecting the integrity of data, enhancing human roles, and ensuring customers feel in control of their experiences.”