Retail tech: AI tools reshape the holiday shopping season

Major retail chains and tech companies are offering new or updated artificial intelligence tools in time for the holiday shopping season, hoping to give consumers an easier gift-buying experience and themselves an augmented share of online spending.

Although AI-powered purchases are in early stages, assistants from Walmart, Amazon and Google can now offer personalised product recommendations, track prices and place orders through unscripted “conversations” with customers. Those features build on updates from platforms like ChatGPT and Google Gemini. Google this month also introduced an AI agent that can call local stores to check product availability.

Salesforce estimated that AI would influence $73 billion, or 22%, of global sales from the Tuesday before Thanksgiving through Cyber Monday, up from $60 billion a year ago. The figure includes everything from a ChatGPT query to AI-supplied gift suggestions on retail sites.

Despite advances, AI’s impact this year will be “relatively limited” since not every site has useful tools and not every shopper is ready to try them, said Brad Jashinsky, senior retail industry analyst at Gartner. “The more retailers that launch these tools, the better they get, and the more that consumers get comfortable and start to seek them out,” he said. “But customer behaviour takes a long time to change.”

AI’s potential to simplify the search for the perfect present is most apparent in tools that promise faster, more detailed results with fewer clicks. OpenAI upgraded ChatGPT with a shopping research feature that provides personalised buyers’ guides drawn from product pages, reviews, prices and previous interactions. Amazon’s Rufus remembers information customers feed it and uses browsing and purchase history to personalise recommendations. Google upgraded its AI Mode tool to answer detailed questions in natural language and provide side-by-side comparisons pulled from 50 billion product listings.

“This is an expansionary moment, I think, for all of technology and for commerce,” said Lilian Rincon, vice president of product, consumer shopping at Google.

Walmart’s AI assistant, Sparky, offers occasion-based recommendations, and an AI-powered gift finder in Target’s app responds to prompts about the recipient.

Tools for tracking online prices have existed for years, but shoppers now have new options. Amazon launched a 90-day pricing history tracker and alerts for when items fall within budgets. Google introduced a more advanced price tracker that lets users refine requests with details such as size and colour. Microsoft’s Copilot launched one as well.

Amazon, OpenAI and Google are racing to enable seamless AI-powered buying within the same program. OpenAI launched an instant checkout feature that lets users buy products suggested by ChatGPT from Etsy sellers and some brands using Shopify. A deal with Walmart will allow ChatGPT members to shop for nearly everything on Walmart’s site, though for now, only one item can be bought at a time. A separate Target deal lets shoppers build carts in ChatGPT before being directed to the Target app to pay.

Amazon is letting Rufus automatically purchase items for customers who set “auto buy” with price alerts, and is allowing Rufus searches to route shoppers to outside retailers when Amazon doesn’t carry an item. Google’s AI Mode includes a “buy for me” option that completes purchases through Google Pay when prices drop, and its automated calling feature phones local stores for information or product checks.

Associated Press