Generative AI is key
Although U.S. investments in consumer applications have slightly declined since 2022, the overall investment value in generative AI has nearly tripled. For online retailers, this might imply that they will outsource content generation to AI more than before. In 2024, nearly one in two U.S. professionals working in the retail industry expected to use AI for marketing automation, while roughly one-third of them mentioned virtual agents and chatbots.No innovation without experimentation (and challenges)
Not all U.S. e-commerce companies are innovating at the same speed. Business-to-consumer companies put more effort into the full implementation of AI technologies, while business-to-business organizations are somehow lagging and find themselves more in the experimenting phase. Multiple factors affect the adoption of AI. CEOs from retail companies considered data security and privacy a key challenge, while managers and employees complained about a lack of awareness and understanding of AI uses.’AI made me buy it’
Generative AI has already revolutionized the customer experience. In the pre-purchase phase, shoppers receive perfectly targeted product recommendations they often struggle to identify as AI-given. AI-powered shopping assistants are bringing user interaction to a new level by providing detailed information on items, and product suggestions based on customers’ budgets, shopping history, type of deliveries, and many other criteria. Gen AI tools proved to be valuable allies in gift-giving. During the winter holiday season, over 60 percent of shoppers were happy to receive assistance and make more confident purchase decisions.Retail chatbots cannot compete with ChatGPT (yet)
Several AI startups providing chatbots and conversational tools are headquartered in the United States. Consumers are increasingly using retail chatbots, but in most cases, these AI solutions cannot provide accurate answers to their questions. Even though it is not possible to directly associate correct answers with e-commerce conversation rates, retailers might need to improve their AI customer service, since ChatGPT set a much higher quality standard for online shoppers.Gen AI might become even more pervasive in the customer journey when retailers figure out how to overcome the biggest challenges in AI implementation: quality of content generation and data protection.
