Given the rapid digitalization and changes in the market and on the Internet, a large number of companies today are introducing the application of personalization and customization in their business. In this way, data on existing consumers is collected and new potential consumers are attracted. By applying customization and personalization, the consumer feels more valuable and is more likely to make a purchase. In this way, a loyal consumer is created. This final paper presents the application of personalization and customization in retail and highlights the advantages and disadvantages of this way of doing business. While it offers new opportunities and identifying consumers needs, companies should be careful with data collection so as not to achieve an opposite effect. The aim of this paper is to show how personalization and customization can be applied through retail business and the influences it has on their application. It also shows how companies adapt to the market and introduce digital transformations, all with the goal of achieving better sales and meeting the needs of consumers. The way of applying personalization and customization in retail is analyzed in detail on practical examples.