Amazon has implemented new generative artificial intelligence (GenAI) technology in an attempt to improve product research and personalize shopping recommendations on its eCommerce platform, joining a growing trend of AI adoption in online retail.
The eCommerce giant introduced AI Shopping Guides on Wednesday (Oct. 9) to simplify product research for consumers. These guides, powered by GenAI, consolidate critical product information such as features, brands and customer insights. They appear in search suggestions and on the homepage, allowing shoppers to explore tailored recommendations based on their needs.
“Retail and, more specifically, eCommerce, is a crucible for new technologies, in large part because the U.S. market is almost perfectly divided into Amazon vs. everyone else,” Eric Best, CEO of retail data management company SoundCommerce, told PYMNTS. “This sets up a perpetual arms race in the industry, where Amazon uses its scale and technology to disrupt a category or feature — which then gives rise to dozens or sometimes hundreds of venture-funded independent alternatives.”
Retail AI Race Speeds Up
Amazon’s AI Shopping Guides compile product information and recommendations for various categories using GenAI. The guides can be used alongside Rufus, Amazon’s AI assistant, to answer additional customer questions during product research.
The competitive landscape for GenAI extends beyond retail.
“Amazon Web Services — and its investment in AI and generative models — sets up an even bigger competitive duel,” Best said. “The counterpoint is the self-proclaimed hundreds of billions being invested in the same capabilities by Microsoft, Google, OpenAI, Apple and Meta; data-focused cloud providers like Snowflake and Databricks; and the thousands of early-stage funded startups building new products on these platforms.”
Several companies are already making waves in the AI-driven retail space.
“Examples of competitive players in the retail space are too numerous to mention, but some of the early winners include companies like SessionAI, which predicts the behavior of shoppers and serves them in-session offers to convert them to buyers; Optimonk also in conversion rate optimization; Octane AI for eCommerce gamification; and ManyChat for eCommerce customer service chatbots,” Best said.
Amazon’s AI integration will likely have significant impacts on consumer behavior, according to Chris Pearce from digital search and content agency Greenpark.
“The enhanced GenAI product listings will mean consumers see richer, more detailed product detail pages more quickly than before,” Pearce told PYMNTS. “Hyper-personalized recommendations and product descriptions” surfaced throughout the shopping journey and could positively influence shopping behavior.
How Retailers Benefit
The benefits of AI could be substantial for sellers on Amazon’s platform. Pearce said a beta test of an Amazon AI assistant for U.S. sellers, Project Amelia, “looks of real value if it delivers on the claim to offer insights, strategies and even diagnose problems with inventory, revenue and conversion.”
The potential cost savings for retailers are notable.
“Enhanced so-called ‘A+ content’ that uses GenAI to create engaging listings, lifestyle imager, and brand narratives is a real-time and cost saver,” Pearce said. “The icing on the cake? Amazon’s ‘video generator’ — while a bit glitchy — offers a potential massive uplift to engagement and conversion at a fraction of the traditional cost.”
Amazon’s AI-driven changes may give the company a temporary edge, but it’s likely to be short-lived.
“Most eCommerce platforms are rolling out AI enhancement features almost weekly, so any advantage will be short-lived,” Pearce said.
He also pointed to changing consumer habits that could challenge Amazon’s dominance.
“At Greenpark, we have seen exponential growth in omnichannel search beyond the big marketplace and search engines. Consumers increasingly turn to social commerce platforms like TikTok shop and Instagram Shopping,” he said.
The rapid adoption of AI in eCommerce is reshaping the industry landscape. Amazon’s moves may force competitors to accelerate their AI initiatives, leading to a new era of innovation in online retail.