UPDATE: As the holiday shopping season heats up, new AI shopping assistants are transforming how consumers find gifts. Just in time for the expected record $253 billion in online spending this December, major tech players like Amazon.com Inc. and OpenAI are rolling out innovative tools to assist shoppers in making decisions.
The latest features from Amazon’s AI-infused Rufus and Google’s agentic checkout are designed to streamline the shopping process. These tools promise to help users find the perfect items while staying within budget, marking a significant shift in consumer behavior. According to a September survey by Adobe Inc., more than 1 in 3 US consumers have already utilized AI tools for online shopping, primarily for product research.
McKinsey & Co. forecasts that this so-called agentic commerce could evolve into a $1 trillion industry in the US by 2030. Yet, while the potential is enormous, the technology is still in a nascent phase, with many companies facing technical hurdles and deciding how to best integrate these tools into existing platforms.
In a recent experiment conducted by Bloomberg, various AI bots—including Amazon’s Rufus, OpenAI’s ChatGPT, and Walmart Inc.’s Sparky—were asked for gift recommendations for moms. The consensus? A cozy bathrobe. Sparky suggested a pink hooded robe labeled “Mama Bear,” while ChatGPT directed users to a robe from Victoria’s Secret.
Analyst Emily Pfeiffer from Forrester Research emphasized that “big bets” are being made on AI’s ability to enhance shopping experiences. However, she cautioned that the impact on this holiday season may be limited.
The allure of AI in commerce is clear; navigating through countless products on major retail sites can be overwhelming. Chatbots offer a more user-friendly approach. For example, users can request specific items like, “Find me a pair of well-reviewed hiking boots under $100.” Early data from Similarweb Ltd. indicates that shoppers engaged via ChatGPT tend to be more informed and prepared to buy than those who conduct traditional searches.
Despite this, the technology is still not delivering significant improvements in shopping experiences. Amazon CEO Andy Jassy recently critiqued rivals’ AI tools, highlighting their struggles with personalization and accuracy in pricing and delivery estimates.
Retailers’ websites were initially built for human interaction, and adapting them for AI use has proven challenging. Current chatbots often simply redirect users to retailer sites without adding meaningful enhancements to the shopping journey. Companies like Anthropic PBC and Alphabet Inc.’s Google are working on protocols to improve how these agents interpret human language for seamless browsing.
As AI companies push forward, partnerships with major retailers and payment processors are essential. For instance, Perplexity Inc. recently integrated PayPal checkout options, enabling smoother transactions. Without efficient purchasing paths, AI tools risk being limited to research functions, as noted by e-commerce analyst Juozas Kaziukenas.
In the gift suggestion experiment, Amazon’s Rufus stood out by asking users about their mothers’ interests and hobbies before recommending a DVD set featuring classic films. OpenAI is also advancing by prompting users for more details before providing suggestions, enhancing the personalization aspect of the shopping experience.
While these AI shopping innovations present exciting possibilities, they still come with caveats. OpenAI’s new tool encourages users to check merchant sites for the most accurate product details and warns that it may occasionally misinform about prices and availability.
As we move into the holiday season, the race is on for AI technologies to prove their capabilities in reshaping consumer shopping behaviors. With significant financial stakes and evolving tools, the coming weeks will be crucial for determining the future of AI in retail. Stay tuned for more updates on this rapidly developing story.
