Forrester study finds organizations leveraging Algolia’s AI achieve over $3 million NPV in three years, achieve payback in six months

Algolia, the AI Search and Retrieval platform trusted by more than 18,000 businesses and millions of developers worldwide, today announced the results of a Total Economic Impact™ (TEI) study conducted by Forrester Consulting. The study examined the potential return on investment (ROI) enterprises may realize by deploying Algolia’s AI search and retrieval platform and found that organizations can achieve a 213% ROI over three years, with a payback period of less than six months.

The study also found that Algolia delivers a net present value (NPV) of $3.1 million over three years by improving search relevance, automating merchandising, and driving revenue and efficiency gains across digital commerce teams.

John Stewart, VP Corporate Communications and Brand at Algolia, said: “Retailers are under immense pressure to drive agility and resilience at a time when prices are hitting record-highs and brand loyalty is down. Ecommerce leaders may think they need to start from scratch on their merchandising strategies to accomplish meaningful revenue gains, but this Forrester study disproves this theory. By adopting Algolia’s cost-effective AI search and discovery, ecommerce businesses were able to double ROI and achieve payback in a few short months. This goes to show that the right AI retrieval and search engine can future-proof and grow retail businesses at a time when volatility is the norm.”

Forrester’s TEI study was based on interviews with four decision-makers with experience using Algolia. The interviewees’ experiences were aggregated into a composite organization representing an ecommerce business with $600 million in annual revenue and more than 600 million searches per year. Prior to using Algolia, these leaders relied on in-house search solutions or bundled search with their ecommerce platforms. These solutions struggled with relevance, scalability, handling complex catalogs, and required extensive manual upkeep.

According to the study, Algolia addressed these issues head-on by empowering organizations to modernize their merchandising strategies through an API-first search and retrieval platform offering advanced features like typo tolerance, dynamic ranking, and rich indexing. These features helped the interviewees enable faster, more accurate multi-modal product discovery, tailor their AI merchandising strategy, and build engaging customer experiences.

As a result, Algolia helped drive measurable revenue growth and operational efficiencies across marketing, merchandising, sales, customer service, and development teams. Additional measurable benefits of Algolia’s platform identified in the Forrester TEI study include:

• $12 million in annual revenue increase driven by improved search relevance, discovery, and merchandising
• Up to 35% time savings for merchandising teams through AI-driven automation; this time savings is worth more than $1.8 million to the composite organization over three years
• 23% time savings for marketing teams and 12% for sales teams
• Redeployment of 1.5 developer FTEs to higher-value, strategic initiatives
• Improved search engagement, including an 11% increase in click-through rate (CTR) and higher add-to-cart rates

Stewart added: “Forrester paints a clear picture of the quantitative benefits of the Algolia platform, but they also discovered a lot of qualitative benefits during the course of their interviews. The study highlights how Algolia supercharges agility by enabling teams to make real-time changes, launch new features faster, and scale search experiences across regions and languages with minimal development effort. Ease of use and scalability are at the heart of everything we do, and it’s why we’re trusted by over 18,000 businesses worldwide. We’re glad this came through in the Forrester interviews.”

The TEI study comes on the heels of two major product announcements from Algolia. In January, the AI search leader debuted a new partnership with Microsoft that will allow retailers to expand their merchandising strategies to LLMs they previously had no control over. Recently, Algolia also announced general availability for its Agent Studio, a platform designed to help teams build and deploy AI agents that are reliable, observable, orchestrated, and ready for production. Together, these innovations build on the revenue and efficiency gains outlined in the Forrester TEI study by extending Algolia’s proven search and retrieval capabilities into agentic and LLM-driven experiences, unlocking even greater potential to drive conversion, agility, and ROI at scale.

To download the full Total Economic Impact™ study, click here. To find out how Algolia’s AI Search and Retrieval platform can help your business drive revenue, time savings, and search conversions, sign up for a demo.

About Algolia

Algolia is the leading AI Search and Retrieval platform, powering 1.75 trillion searches a year for more than 18,000 businesses. With a unified keyword and vector search and retrieval engine, Algolia delivers the world’s fastest and most scalable search and discovery technology. Companies rely on Algolia to build agentic, generative, and search experiences through tools like Agent Studio. With over a decade of innovation, Algolia is redefining retrieval-powered applications and the future of AI discovery.

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