Generative artificial intelligence (Gen AI) is becoming a central part of consumer expectations in retail, new data suggests, with 71% of shoppers seeking its integration into their purchasing experiences. This shift is driven primarily by younger generations such as Gen Z and Millennials, who prioritise personalised and digitally streamlined interactions, according to a new report from Capgemini Research Institute. The study, conducted in late 2024 across 12 countries in North America, Europe, and Asia-Pacific, surveyed 12,000 consumers aged 18 and above.
“Consumers today want personalised shopping experiences, enhanced by AI and generative AI,” said Capgemini’s global retail lead Lindsey Mazza. “In addition, they expect fast and efficient deliveries and have become more conscious of their purchasing impact. To remain competitive and build brand loyalty, retailers must adopt strategies that put the consumer at the centre, leveraging AI to deliver seamless yet exceptional customer interactions. The clear shift towards social commerce is also significant. Retailers need to capitalise on their social and digital advertising platforms to engage consumers early in the purchasing journey.”
Gen AI as a tool for product discovery
The adoption of Gen AI in shopping has seen a notable rise, with 46% of surveyed consumers expressing enthusiasm for its role in online retail. Three-quarters of respondents are open to receiving recommendations generated by Gen AI, marking an increase from 63% in 2023. Furthermore, 58% of consumers now turn to Gen AI tools instead of traditional search engines when seeking product or service recommendations.
The preference for AI-powered tools that consolidate information is also growing, with 68% of consumers favouring solutions that aggregate search results from online search engines, social media platforms, and retailer websites. Despite these advancements, consumer satisfaction with Gen AI implementation has dipped slightly, falling to 37% in 2024 from 41% the previous year.
Artificial intelligence and social media are reshaping how consumers discover products. AI-driven influencers, such as virtual avatars, are gaining traction, with 25% of consumers relying on their recommendations for purchases. Among Gen Z, the influence of social media has grown significantly, with 70% reporting product discovery through platforms such as Instagram and TikTok in 2024, compared to 45% in 2023.
Social media also serves as a vital channel for customer service, with 40% of respondents turning to these platforms for issue resolution and support. This trend underscores the expanding importance of social media in retail strategies.
The report reveals that 67% of consumers notice advertisements on retailer websites or apps during their product searches. Over the past year, online advertisements have influenced nearly one-third of online purchases.
In contrast, in-store advertisements face challenges, with 59% of consumers finding them generic. Personalisation remains a key demand, with 53% expressing interest in solutions such as interactive touchscreens, smart mirrors, and shopping cart displays. Retailers are investing in retail media networks (RMNs) to address these expectations and improve engagement.
A separate survey by Salesforce has highlighted the significant influence of AI on the 2024 holiday shopping season. According to Salesforce, AI-powered tools contributed to $229bn, or 19%, of global online sales during this period. The findings, based on an analysis of 1.5 billion global shoppers and 1.6 trillion page views, revealed that AI-driven product recommendations, personalised promotions, and customer service interactions played a critical role in driving holiday purchases.
Engagement with generative AI tools rose by 6% year-on-year, with features such as conversational agents experiencing a 25% increase in usage compared to earlier months. The analysis also revealed the growing dominance of mobile commerce, which accounted for nearly 70% of global online sales during the season. These trends underline AI’s expanding role in shaping consumer behaviours and preferences during peak shopping periods.
Read more: AI tools and digital agents drive $229bn in online holiday sales, new data suggests
