This is the first Christmas season for many Americans, and if the topic of “artificial intelligence” comes up at the table, the majority of the family may be familiar with it.
However, don’t expect AI to take on Santa’s heavy lifting just yet.
This holiday season, more retailers and consumers are experimenting with technology thanks to the rise of generative AI and ChatGPT. However, for the time being, most of technology’s impact will be invisible to consumers.
Salesforce estimates that artificial intelligence will have a $194 billion impact on global online holiday spending. According to the software company that monitors consumer trends, artificial intelligence (AI) had a $51 billion impact on online sales during Cyber Week, which runs from Tuesday, November 21, through Monday, November 27, also known as Cyber Monday.
However, a large portion of that AI influence is derived from features that customers are already familiar with, like product recommendations based on previous purchases and searches made by customers just like them.
Future holiday seasons will have to wait for more revolutionary applications of AI, according to Rob Garf, vice president and general manager of Salesforce’s retail and consumer goods. However, he claimed that AI will eventually alter the clientele’s experience.
Retail employees could have more free time and patience for customers as they are able to automate more tasks in their offices, call centers, and retail stores, according to Garf. Furthermore, he stated that retailers will be able to customize websites and apps to create digital assistants that can make suggestions, respond to queries, and more as AI gets better at understanding natural language.
“We are still in early days,” he said. “Retailers are testing and learning, and it’s only a leading indicator of what to come.”
As more companies use AI, its limitations and risks have become more apparent, despite the fact that investors and companies alike are placing significant bets on the technology’s future.
These three prominent instances of AI during the busiest shopping season could serve as a look ahead:
An efficient and time-saving tool
Artificial intelligence might be to blame if you were taken aback to discover a well-liked toy in stock at your neighborhood store.
This season, AI is significantly assisting retailers in the background. Consider those routine but important chores like placing the proper inventory order, creating more targeted marketing emails, or creating thorough product descriptions for websites.
Artificial intelligence has helped Walmart make decisions regarding holiday inventory by forecasting demand for different products at various locations. Says Srini Venkatesan, executive vice president of U.S. omni platforms and technology at Walmart, “the tech can help the company identify a best-selling toy or sweater in a particular region and make sure more are shipped to nearby stores.”
Target is also utilizing AI to anticipate demand across multiple locations and identify items that are out of stock, allowing staff to restock shelves prior to them becoming empty.
In order to better understand what customers are looking for on its website and to determine the most effective routes to deliver online orders to customers’ doors on time, Nordstrom started utilizing AI. For example, it aims to improve language interpretation so that a customer searching for “romantic flowy dresses” finds the products that most closely resemble that style.
Retailers are also focusing on how to use AI to increase productivity, which may allow them to hire fewer employees or free up more time for staff to handle other duties that involve interacting with customers. Concerns about workforce reductions brought on by the advancements have also been addressed by CEOs like Doug McMillon of Walmart and Shantanu Narayen of Adobe.
In late August, Walmart introduced My Assistant, an internal ChatGPT version that more than 50,000 corporate staff members can use for a variety of tasks, including creating slide decks and email pitches. Walmart is training teams on the generative AI tool and suggesting use cases for it, according to a company spokesperson who declined to disclose the number of employees who have used it thus far.
Additionally, Amazon unveiled new time-saving tools for advertisers and sellers this fall. Third-party sellers don’t have to spend hours writing lengthy product descriptions; instead, they can write a few phrases and let generative AI handle the rest. In order to create aesthetically pleasing images to go along with a product, advertisers can also rely on a new tool.
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