How generative AI can reduce ‘information overload,’ increase loyalty and sales

Having strategies that allow retailers to reach and engage each individual consumer is more
important than ever. It's no longer enough to offer a wide choice of products and services in
the hope that something sparks an interest and gets added to the shopping cart.

In fact, too much choice and information could result in the exact opposite.

According to an Accenture report, “The Empowered Consumer,” retailers and brands have inadvertently created a cacophony of choice that could result in lost revenue. The report highlights how the issue of "information overload" — the result of the sheer number of choices, messages, ads and claims consumers now face — is leading to almost three quarters (74%) of consumers abandoning their purchases completely.  
 
Although abundant information and endless options may seem like a good thing, it can mean that consumers have to spend more time and effort deciding what to buy, and often end up feeling overwhelmed.

Consumer "Information Overload"

In the last three months of 2023, almost three quarters (74%) reported being inundated by too much choice, and a slightly higher number (75%) reported feeling bombarded by advertising.  
 
What's interesting is that it doesn't matter what category is being shopped. The challenges are not confined to big-ticket items. For instance, the report found that consumers feel less confident about booking a hotel than buying a car; booking a flight is nearly as nerve-wracking as getting a mortgage and choosing a moisturizer is on par with buying a washing machine. 
 
For retailers and brands, this means engagement strategies will be far more dependent on granular insights from their consumer data and analytics. That means taking a deeper look into the intricacies of each individual person — their current outlook, hopes for the future income trajectory and the overall impact this will have on their shopping behavior.

Another Solution

Harnessing new and emerging technologies, such as the transformative power of generative artificial intelligence are some of the ways retailers can reduce the "noise" around decision-making and increase engagement, loyalty and sales in the process. 
 
For instance, gen AI can act as a shopping advisor — think of it as a ‘sales advisor by your side throughout the purchasing journey — providing recommendations based on what a customer cares most about in the moment from pricing and nutritional information, to weather an item has been ethically sourced.  
 
This will come as welcome news to the six in 10 consumers who find it difficult to evaluate a product's credentials at the point of purchase in store. So much so that 78% are unsure whether a product will even deliver on its promises.

From Discovery, to Purchase, to Loyalty

Gen AI can also help consumers discover, find and buy items based on the need in a more human and natural way. For example, "I need groceries for a dinner party" versus, "what can I cook for a celebratory dinner party for six people that costs less than $200 dollars, with options for a vegan guest." 
 
This becomes even more powerful when recommendations are linked to inventory that's in- stock and ready to be added to the shopping cart. It also provides opportunities to deliver new selling and loyalty programs, e.g. curated menus, cooking guides, special events and so on.  
 
The big opportunity here is that retailers can keep the consumer within their brand experience, so that they don't go out to the wider internet for inspiration. It also means they can get more insight into their existing customer base for selling and loyalty programs.  
 
Consider Marks & Spencer. Thanks to its acquisition of Thread, it is now better placed to help customers move from search to purchase with less effort by making recommendations based on style, size and budget.

Enhancing Customer Experiences

There is also an opportunity to bring Gen AI-powered advisor tools to the retail frontline workforce to further enhance customer experiences. It’s what Best Buy is looking to do with the launch a new suite of Gen AI-enabled tools to help its customer care agents better service customers over the phone.

The AI tools will help care agents assess customer conversations in real-time, providing them with in-the-moment, relevant and human-focused recommendations. The tools will also help summarize conversations, detect sentiment, and utilize data from the call to reduce the likelihood a similar issue will occur in the future.

Best Buy is also working to develop a Gen AI-powered assistant to provide store associates easier access to information such as company resources and product guides. This will allow them to help customers more efficiently than ever.

Early-Mover Advantage Key to Staying Ahead  
 
The above examples show how Gen AI is opening up new opportunities for retailers achieving the ambition of transforming how customers think about their brands.

However, this is a very fertile and fast-moving space, and those that watch and wait are unlikely to catch up. Early movers already have the advantage, with Accenture analysis showing they are 3.7x more likely to use gen AI to identify new and unmet needs.

With more than half (51%) of consumers already open to using generative AI advisors, retailers and brands should move quickly to capitalize on the rise of this exciting new technology.

It means making sure the technology is used responsibly by design and that guardrails are in place for acquiring, refining and deploying data. It also means thinking through cybersecurity operations and making certain that regulatory and privacy risks are fully considered throughout.

Retailers who get that right are poised to reap the greatest rewards.