A iPhone with the landing page of OpenAIs ChatGPT software

ChatGPT: a fad or the future of retail?

ChatGPT has taken the world by storm. After launching in November 2022, it has since grown to more than 100m active monthly users, creating new opportunities/possibilities and instilling fear across multiple sectors and industries.

Its advancement has spurred a new wave of AI-driven innovation. And big e-commerce players have responded by integrating such technologies across all stages of their customer journey to both stay at the very forefront of the latest consumer trends and (hopefully) improve efficiencies.

Klarna, for example, announced a new collaboration with ChatGPT’s creator OpenAI to “level up the shopping experience”[1]. Using ChatGPT’s technology, it will provide personalised and curated product recommendations to ask the platform for shopping advice and inspiration. A similar initiative has been launched by Shopify[2], which powers more than 70,000 business in the UK, while Amazon is reportedly launching a ChatGPT-style product search to its webstore[3].

But is this what consumers really want? The simple answer is…probably. Today, according to consultants Wunderman Thompson, 57% of spending takes place online, a figure expected to decline to 54% now that the dust has settled after COVID-19, but that is still 9 percentage points higher than pre-COVID.

The evolution to online spending has also changed how people shop. Nearly half (47%) of consumers use Amazon for inspiration in the UK according to Wunderman Thompson, followed by search engines (32%) and then retailer sites (25%).

Marketplaces like Amazon are unique in their ability to pool products from multiple brands and retailers and enable consumers to shop and compare more effectively. It’s therefore no surprise that they are today the highest rated channel amongst UK consumers and with innovations like ChatGPT the gap between “traditional” brick-and-mortar retailers and online marketplaces could widen further.

Or perhaps not?

Retailers are still trying to find their feet in the post-pandemic era, and some technologies touted as the ‘future of retail’ have already been culled. For example, Amazon Fresh’s checkout-less stores, which were designed to create a “super-easy shopping experience”, have already been scaled back amid disappointing sales and a bleak economic outlook.[4]

In reality, it’s hard to know whether trends like ChatGPT will take the retail—and particularly e-commerce—world by storm. Or, whether they will just be another fad. But, in the short term, innovations like ChatGPT underline the increasing need for sophistication by operators as they compete for customer in a fraught retail landscape.

[1] https://bit.ly/3ImFzcN

[2] https://bit.ly/41SQiCl

[3] https://bloom.bg/3pSxCFT

[4] https://bit.ly/434zSrQ