Can AI Deliver on the Hype Promised for Shopping?

A global survey from the IBM Institute for Business Value found that only 9% of consumers are content with in-store shopping, and only 14% are content with online shopping. Emerging shopping technologies were found to not be living up to their hype.

The survey of 20,000 consumers across 26 countries found that over half of respondents are eager for artificial intelligence (AI) enhancements like virtual assistants (55%) and AI applications (59%) as they shop. Personalization and targeted offerings were also found to hold appeal, with 52% interested in receiving information, offerings, and advertisements from stores that are relevant to their specific interests.

However, the virtual assistant experience was found to be wanting. About one-third of those who have used virtual assistants are satisfied with the experience, with nearly 20% so disappointed they don’t want to use virtual assistants again.

At the store level, consumers surveyed want a greater variety of available products (37%), more information about products (26%), and faster checkout (26%). Showing the appeal of a digitally integrated experience, 65% are supplementing their in-store experience by using mobile apps while shopping.

Online, challenges cited in the survey included finding the products they want (36%), not having enough information about products (33%), and dealing with a cumbersome return process (33%).

IBM’s survey also found economic concerns, particularly inflation, to be influencing consumer’s dismal view on shopping expectations. Of the respondents, 62% cited price as a top reason they switch stores or brands.

Part of the technology challenge is a reluctance by many consumers to share personal data to take advantage of AI’s data-mining capabilities.

A survey last year from CI&T, the software and digital consultancy company, found that 58% of consumers “believe data sharing is necessary for brands to achieve personalization,” but 42% think retailers should be able to create a personalized shopping experience without gathering any personal information from consumers, whether intentionally or without permission.

The survey further found wide disagreement about what personal data was appropriate to share. The four pieces of information consumers are most open to retailers learning about are gender (14% openness), the city they live in (14%), how much they are willing to spend on an item (11%), and age (11%).

Salesforce’s Connected Shopper Report based on a global survey of 1,125 retail executives last year found that 92% of retailers are investing in AI more than ever to improve shopping experiences. Of the respondents, 59% are using AI to help store associates make product recommendations to shoppers, 55% are using AI to create a conversational digital assistant to help online shoppers find products, and 51% using AI to create personalized product bundles.

On the downside, Salesforce’s study found the top barriers to retailers’ retention and engagement efforts overall to be “a lack of customer insights for segmentation and targeting, followed by an inability to respond quickly to market opportunities.”