There’s a new shopping sidekick in town: generative AI. Looking for gift ideas and bargains, online shoppers flocked to artificial intelligence chatbots in droves this holiday season. Retailers reaped the benefits, particularly portfolio name Amazon . Clicking on a link to a retail site provided by AI increased 1,300% year over year during November and December, according to data from Adobe. The software company, best known for Photoshop and Acrobat, also has a digital analytics arm. While coming off a small user base, the astounding annual growth rate nevertheless shows that chatbots built on generative AI technology such as ChatGPT are changing how people shop. They can be a tool for shoppers both uncertain about what to get for family and friends and hunting for the best deals. Consumers are craving “speed, efficiency, and strong pricing, given persistent inflation,” according to Vivek Pandya, an analyst at Adobe Digital Insights. Users are now “setting a lot of criteria” as they refine their search for products and “trying to move through that in a speedy fashion,” he told CNBC in an interview. Historically, shoppers prioritize price, selection, and value. Now, chatbots are helping users find what they want and need in faster, more convenient ways. Unlike search engines, chatbots offer a conversational experience. With OpenAI’s ChatGPT, users engage in back-and-forth interactions to narrow their search. Google Search still returns the traditional results users have come to expect but also generates AI responses. And, like ChatGPT, Alphabet’s Google has a standalone Gemini chatbot that users to interact with directly. Retailers themselves also are getting into the action — rather than just counting on chatbots to send web traffic their way or paying for it. Unsurprisingly, Amazon is at the forefront thanks to its tech industry roots and heavy spending on AI. Amazon has Rufus, a generative AI-powered conversational shopping assistant available on the Amazon app and desktop. Launched in February 2024, Rufus acts as a personal shopping guide, helping customers discover products through interactive conversations, personalized recommendations, and real-time answers to their questions. Trained on Amazon’s vast product catalog and customer reviews, Rufus connects shoppers with the best deals, and time-sensitive discounts — all with a few simple queries. For instance, if a customer asks Rufus to compare different products, using natural conversational language, it will immediately provide images, and detailed descriptions, along with filters and price ranges — making it easier for the shopper to find exactly what they’re looking for without taking them offsite. Customers have already asked Rufus tens of millions of questions, according to an Amazon update on the service in September. Upon launch, investment firm Baird viewed Rufus as a “significant development” for its ability to “drive higher conversion rates from more relevant product…
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