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71% of consumers want generative AI integrated into their shopping experiences: Report

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Over half (58%) of consumers have replaced traditional search engines with Gen AI tools for product/service recommendations, up from 25% in 2023

Bengaluru: As many as 71% of consumers want artificial intelligence (AI) to be integrated into their purchasing experiences, according to a report by Capgemini Research Institute. The preference of Gen Z and millennials, for hyper-personalisation and seamless digital experiences is mainly driving the trend. 

Nearly half (46%) of consumers are enthusiastic about the impact of Gen AI on their online shopping and three quarters are open to Gen AI recommendations, up from 63% in 2023. More than half (58%) have replaced traditional search engines with Gen AI tools as their go-to for product/service recommendations. 

68% of consumers want Gen AI tools to aggregate search results from online search engines, social media platforms, and retailers’ websites to provide a one-stop shop for highlighted purchase options.

7 in 10 consumer products and retail companies view Gen AI as a transformative technology. However, the study finds that while investment in the technology is on the rise, Gen AI usage is not meeting expectations. Consumer satisfaction with the technology is down from last year (at 37% in 2024 compared to 41% in 2023). 

“Consumers today want personalized shopping experiences, enhanced by AI and generative AI. In addition, they expect fast and efficient deliveries and have become more conscious of their purchasing impact,” said Lindsey Mazza, Global Retail Lead at Capgemini. 

“To remain competitive and build brand loyalty, retailers must adopt strategies that put the consumer at the center, leveraging AI to deliver seamless yet exceptional customer interactions. The clear shift towards social commerce is also significant. Retailers need to capitalize on their social and digital advertising platforms to engage consumers early in the purchasing journey,” added Mazza.

As per the report, willingness to pay more for quick delivery skyrocketed from 41% in 2023 to 70% in 2024. With this increase, consumers are now willing to pay 9% of the order value for 2-hour and 10-minute delivery. 65% of consumers consider a two-hour delivery format a key attribute when they shop. This trend is prevalent in countries such as India, Germany, France, Sweden, Spain, and the Netherlands, with the US lagging in this regard.

Sustainability is a critical factor when making purchasing decisions, with 64% of consumers buying from sustainable brands and 67% would switch retailers due to a lack of sustainability. Though their willingness to pay a premium is decreasing. The proportion of consumers willing to pay between 1-5% more has risen slightly, from 30% to 38%, but those willing to pay more than 5% has dropped consistently over the past two years. 

The study highlights that consumers are also increasingly seeking more detailed information about the product they are purchasing. Nutritional information comes out as the key consideration, with 67% of consumers saying they would switch products based on this. 

AI influencers, such as avatars created using artificial intelligence, are rising in popularity with one quarter of consumers trusting them and making purchases based on their recommendations. Social media influencers are also becoming popular, with around 7 in 10 Gen Zs learning about new products through them in 2024, up from 45% in 2023. 

Platforms such as Instagram and TikTok are also reshaping retail, with over half of consumers discovering new products via social media, up from 32% in November 2022. The report found that 40% of all consumers occasionally use social media for customer service interactions.

The report found that 67% of consumers notice ads on retailer websites/apps when they search for a product. Over the past 12 months, online adverts influenced nearly one-third of online purchases. 

In contrast, in-store advertisements lag behind in consumer satisfaction, in terms of content quality and placement.  59% of consumers say the ads shown are very generic and don’t serve their specific needs. While 53% want personalised in-store ads such as a display in a smart shopping cart, smart mirrors, or interactive touchscreens. As a result, retailers are focusing on retail media networks (RMNs) to capture consumer attention.

The report also finds that 53% of consumers switch brands/retailers regularly, despite subscribing to their loyalty programs. Experimentation and lack of personalisation are major reasons for switching. 

The report, titled ‘What Matters to Today’s Consumer,’ surveyed 12,000 individuals aged 18 and above from 12 countries across North America, Europe, and Asia-Pacific during October and November 2024.

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