An absolute focus on improving the shopper experience is not anything new for retailers – it is what successful retailers have long focused on to drive loyalty and revenue. However, the improvements and capabilities offered by GenAI are reshaping retail.
It is offering greater opportunities than ever to bring joy to the shopper experience to keep customers coming back for more, whether in store or online. The ease with which this can now be done is an exciting turning point for retailers.
Speaking recently at NRF, Kevin Gleason, senior director of global brand and marketing at multipurpose tools retailer Leatherman, talked about customer joy as when a shopper feels “heard, understood and cared for,” with GenAI tools crucial in delivering this embracing of the customer.
It is something that customers are demanding too – 43% believe that GenAI-based solutions will make their shopping experience more personalised and more efficient in the future.
Understanding how AI-led innovation can enhance the shopper experience as part of a broader strategy that also includes good UX/UI design, good data hygiene and security and trust of the application is vital.
Personalising the shopping experience to make it more relevant
GenAI is delivering an online chat and search functionality which is more natural, conversational, and intuitive for customers with the creation of virtual assistants that sound more human than ever.
It enables retailers to provide expert advice and relevant product recommendations that are more akin to an in store experience and is becoming a critical component of a retailer’s omnichannel strategy.
Walmart, for example, is using GenAI in search on its website and app to understand the context of a customer’s query and generate personalised responses in a more interactive and conversational experience – such as understanding the different requirements between a search for products for a Superbowl party and a children’s birthday party.
The likes of Asos, Carrefour, and Farfetch also use GenAI-powered shopping assistants to better assist customers.
This type of functionality is key to a personalisation that drives engagement through relevance, offering tailored experiences dependent on the behaviour and profile of the customer which make them twice as likely to add products to the basket.
The natural language functionalities of GenAI solutions are driving a move to conversational commerce, achieved by using the copilot template for personalised shopping on Azure OpenAI Service (preview) from Microsoft, for example, which is accelerating retailers to the concept of truly personalised shopping online.
Improvements in marketing
Shoppers can quickly be turned off by irrelevant marketing – instead, they are more likely to accept marketing that is genuinely of interest to them.
Microsoft is enabling this with new copilot features in Dynamics 365 Customer Insights that it says will allow marketers to use GenAI to create personalised marketing campaigns.
Leatherman is using this tool to bring its business closer to the consumer while also driving basket sizes and conversion rates. “We have a broad, diverse set of audiences but in order to reach each of those segments we have to deliver an experience that speaks to the relevance of their use case,” said Gleason.
“So, the ability to leverage technology to scale to reach those different segments with personalised journeys and generative content in the near future is very exciting.”
Store associate customer service
While GenAI enhances the online experience it can do the same for store associates too, for instance using Microsoft’s copilot template for store operations to enhance knowledge of products or store procedures to empower staff better do their jobs and focus on the customer. This can be particularly helpful for seasonal staff where time to train is limited.
“Empowerment is such a strong tool that GenAI can unlock,” said Canadian Tire’s Alana Ilana Santone, svp of digital and connected retail at NRF.
“One of the challenges we’ve had is not only having the appropriate amount of labour in store but also having that labour have the intelligence or knowledge to be able to support customers in those high friction high complexity purchases,” she said.
Canadian Tire will launch new functionality later this year in conjunction with Microsoft that uses the data it has to better empower the customer or store associate through the path to purchase.
The need for partnership
There are many ways that GenAI can bring joy to the shopping experience – making it easier faster and more fun for the consumers to find the products they love.
But it can be a daunting technology to implement with retailers sometimes overwhelmed with how to achieve the performance, architecture, and design of AI solutions that they desire. And investment plays a huge role too.
With capabilities and its boundaries being continually extended successful GenAI adoption in retail requires a partnership approach to deliver true customer joy.
Read more about Microsoft AI capabilities for Retail: Microsoft introduces new capabilities that help retailers bring AI to the shopper journey and enhance store associate experiences
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