AI in Holiday Shopping: The Trends Unwrapped
Illustration: © AI For All
The holidays bring an enormous amount of unwanted stress – and this season is shaping up to be more difficult than ever before. With outside factors, like inflation, and the normal stressors of finding the perfect gift, both weighing heavy on consumers, it’s on retailers to help make shoppers’ lives easier.
According to the National Retail Federation, consumers are slated to spend 2.5%–3.5% more than they did last year. Understanding what consumers need and want has never been more important – and to get a deeper understanding, we polled 1,000 U.S.-based adults to specifically see how they want AI integrated into their ecommerce experience.
The answer? Consumers do want to see AI used in their shopping experiences. According to the survey,
36% are interested in using GenAI-powered reviews summarizing product pros and cons during the holidays, and 40% year-round.
However, there appears to be hesitancy when it comes to trusting the technology. The data shows that 59% of shoppers would rather get advice directly from their family and friends – not AI – when deciding what to give them. Before retailers can secure consumer buy-in for this innovative and impactful technology, they must first gain a nuanced understanding of current consumer perceptions around AI-driven shopping. Below, we delve into these insights.
Stressful gift searching – AI to the rescue
Finding the perfect gift during the holidays is tough - and 48% of consumers agree, noting the gift search stresses them out – that number rising to 57% for Millennials and 66% for Gen Z. Luckily – AI is here to provide relief, and consumers appear to be happy with the helping hand. When asked if they would be interested in using generative AI product comparisons, which summarize and present the differences between various products while shopping, 39% of consumers would be interested in utilizing this feature year-round, and 36% want this specifically for holiday gift shopping. This will be especially important this holiday season as consumers continue to be picky about their spending. These product comparisons may help shoppers find the less-expensive product that still boasts quality.
Millennials: AI’s biggest fan?
When it comes to holiday stress? Millennials take the cake, with 66% saying gift shopping is a source of anxiety. Just 22% of consumers said they’re worried about the shorter time frame between Thanksgiving and Christmas, but for Millennials, this number rises to 33%. This may explain why only 18% of Millennials are waiting for Black Friday deals – most started their shopping early, with 60% taking advantage of Amazon’s October Prime Days.
Additionally, Millennials are excited about AI’s help this holiday season. Notably, 56% say they would prefer AI’s recommendation for gift ideas over their friend or family member. In the same vein, they don’t care to have AI help with gift-giving – 55% say they’re not ashamed to have AI help choose their gift.
Bridging the AI trust gap
While it seems that some shoppers trust AI to help select the perfect gift, they still don’t believe that the technology can know them better than their loved ones, despite being trained on their retail preferences and past purchases. The data shows that the majority of consumers, 54%, say they would not trust AI more than those in their life to pick out their gift – but some still think AI is a superior gift-giver:
- AI vs. Friends: 24% say AI wins
- AI vs. Coworkers: 19% say AI wins
- AI vs. Siblings: 17% say AI wins
- AI vs. Romantic partner: 14% say AI wins
- AI vs. Parents: 13% say AI wins
However, some consumers still haven’t made up their minds. When asked if they think AI could know their loved ones’ gift preferences better than they do, the results were scattered:
- 43% said that it’s possible, but they’d still trust their own instincts more
- 36% said no
- 21% said yes
There’s a clear opportunity for retailers to help fill the trust gap between AI-powered shopping and consumers. This can be done by leveraging smarter technology and solutions that truly know and understand the customers and show them that they can, in fact, trust AI to be their gift-giving sidekick.
Ecommerce
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Algolia is the world’s only end-to-end AI search and discovery platform. Our engineers invented a breakthrough use of AI to create exponentially better search & discovery. Algolia’s proprietary NeuralSearch tech combines vector-based natural language processing & keyword matching in a single API. Algolia powers 1.75 trillion search requests a year or more than 30 billion a week.
Author
Algolia is the world’s only end-to-end AI search and discovery platform. Our engineers invented a breakthrough use of AI to create exponentially better search & discovery. Algolia’s proprietary NeuralSearch tech combines vector-based natural language processing & keyword matching in a single API. Algolia powers 1.75 trillion search requests a year or more than 30 billion a week.