What: As the global GenAI landscape fragments between US, China, and emerging middle powers, retailers face unprecedented challenges in balancing technology access, data sovereignty, and operational efficiency across different markets.

Why it is important: The evolving landscape forces retailers to fundamentally rethink their technology strategies, as relying solely on solutions from GenAI superpowers may no longer be viable in markets with emerging data sovereignty requirements and local AI ecosystems.

The emergence of middle powers like the EU, Saudi Arabia, UAE, South Korea, and Japan alongside the US and China is reshaping the GenAI landscape. This evolution creates both challenges and opportunities for retailers, who must balance access to cutting-edge technology with local compliance requirements. The implications affect fundamental business operations, from supply chain management to customer data handling. As countries develop their own AI capabilities and regulatory frameworks, retailers need flexible, regionally adaptive strategies while maintaining operational consistency. The stakes are high, with early GenAI adopters reporting significant revenue improvements, making strategic adaptation to this new geopolitical reality crucial for future competitiveness.

IADS Notes: The geopolitical landscape of GenAI is forcing retailers to adapt their operations to varying levels of AI accessibility and processing capabilities across regions. Market access has become increasingly complex with new regional standards and regulations , while implementation success varies significantly - 87% of early adopters see revenue increases of 6% or more. As regional AI powers emerge, retailers must develop flexible partnership strategies, particularly given the complex data localisation requirements across the EU, China, and emerging middle powers.

How CEOs can navigate the new geopolitics of GenAI