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Key Takeaways
- Consumers will have more trust in shopping via ChatGPT as brands they know, such as Walmart, begin working with the tool, an analyst told Investopedia.
- Retailers and brands may benefit from partnerships with ChatGPT by reaching new audiences and improving their ability to research and target customers, Canaves said.
Walmart has entered the chat.
This week’s news of a partnership between the retail giant and OpenAI, the ChatGPT operator, is a substantial step forward for the encroachment of artificial intelligence into retail. Established retailers like Walmart (WMT) working with ChatGPT should bolster confidence in the tool as a way to make purchases, said Sky Canaves, an analyst covering retail and e-commerce for market research company Emarketer,
“That will go a long way towards ameliorating trust concerns or worries,” Canaves said. “Most consumers trust Walmart.” (It’s also lifted Walmart’s stock.)
Etsy (ETSY), Shopify (SHOP) and Walmart have all announced partnerships with OpenAI in recent weeks, moves Canaves said highlight younger generations’ growing reliance on AI chatbots and shifts in how consumers shop.The partnerships allow—or will soon allow—people using digital wallets to complete transactions within conversations held with chatbots, the marketplace operators said.
Why This News Matters
As more people use AI-powered chatbots like ChatGPT, it could substantially change the way people think about shopping—and how they tend to connect with brands and retailers, who have for years invested in their brands and e-commerce platforms. This week’s news of a Walmart-OpenAI partnership, meanwhile, suggests that things are accelerating.
Nearly 40% of Americans have used generative AI to research products, find deals, come up with gift ideas or otherwise assist with shopping, according to an Adobe (ADBE) survey. More shoppers were beginning to trust these tools before Walmart’s announcement, according to Adobe and Salesforce (CRM). (Salesforce is also working with OpenAI to improve ChatGPT selling options for its clients.)
“Consumers, particularly younger consumers, are using ChatGPT so much,” Canaves said. “They use it more for education, and in their day-to-day lives for all sorts of activities.”
Fewer people appear to be engaging with specific retailers’ AI chatbots, such as Walmart’s Sparky or Amazon’s Rufus, Canaves said. About a quarter of consumers have tried these sorts of tools, with nearly 17% finding them helpful, and 9% saying they don’t offer much benefit, according to Emarketer surveys.
Still, more brands and retailers will likely focus on conversational commerce, Canaves said. Besides reaching people where they are online, collaborating with groups like ChatGPT may help merchants learn about their customers and personalize pitches, she said.
“ChatGPT users are having conversations that not only span shopping and shopping intent, but a whole range of lifestyle and workplace and educational topics; health care, psychological and mental health topics,” Canaves said. “It’s a very fertile area for getting to understand consumers and their needs, and then targeting them in relevant ways.”
Companies that make consumer goods, meanwhile, may also need to revaluate the way they connect with consumers, Deutsche Bank analysts wrote this week.
“AI’s role as a new and powerful intermediary marks a potentially crucial change,” they wrote. “Its ability to proactively suggest alternatives, private label offerings, or even niche brands based on perceived value, specific user requirements (e.g., dietary restrictions, budget), or availability could erode traditional loyalties and/or commoditize certain categories.”
