Joseph Arthur
Sep 7, 2023

Consumers are blind to AI’s benefits—brands need to prove the data value transaction

Despite continual demand for better personalisation and more streamlined purchase journeys, British shoppers remain skeptical of the benefits of AI-powered automation and for one reason: data privacy.

Consumers are blind to AI’s benefits—brands need to prove the data value transaction

Most UK consumers (59%) are not convinced that AI is improving their retail experiences despite 70% preferring brands that offer personalised recommendations—one of AI’s most common use cases in retail.

This is according to research from SAP Emarsys whereby over 2,000 UK shoppers were surveyed on thoughts regarding AI in retail.

The findings reaffirm the disconnect between consumers’ concerns about automation and their personalisation expectations.

Not only are the majority of shoppers unconvinced that AI is positively impacting their retail experiences, but a quarter (25%) of consumers are concerned that it will negatively impact their experiences.

Interestingly, although 91% of consumers prefer to interact with humans rather than AI, less than one in three (31%) can tell the difference between a human and an AI chatbot online.

Consumers are blind to AI’s benefits

Emarsys’ analysis suggests that this negativity is due to consumers failing to credit AI for their best online shopping experiences. Shoppers value effectively personalised content, customised recommendations and swift purchase journeys but don’t recognise that AI is behind these advancements.

The main reason behind consumers’ trepidation continues to be the use of their data. 60% of the respondents want retailers to strike a better balance between collecting their data and improving their shopping experiences, believing that the current processes behind data collection put too much risk on their privacy.

Ultimately, this trend further underlines that despite its benefits, consumers don’t yet trust AI tech or brands to use it responsibly.

Kelsey Jones, Global Head of Product Marketing at SAP Emarsys explained: “The benefits of AI in retail can’t be overstated: not just for brands but for customers as well. It’s clear that, at present, shoppers aren’t entirely convinced of AI's value. But when used responsibly, AI can truly enhance user experience in everything from receiving the right recommendations to easy purchasing processes.

"The personalised experiences that drive business growth and establish long-term customer loyalty aren’t realistic without data, so it’s essential that retailers educate shoppers and strike a mutually beneficial balance for data sharing. In order to do that, transparency is critical; brands need to explain how data is being used and the direct value it offers to consumers in terms of driving the personalisation that they so desire at every touchpoint.

“This education will be essential for the widespread adoption of AI and the consumer benefits it brings, with leading retailers able to meet – and even anticipate – their customer’s expectations through the relevant, reliable, responsible use of embedded AI.”

“People are more amenable to sharing their data when it provides direct value… and stronger connections with brands”

Expanding on this, Ritu Bhargava, President and Chief Product Officer, SAP Industry and Customer Experience, explained: “We typically see that people are more amenable to sharing their data when it provides direct value, in savings, efficiency, and stronger connections with brands. But transparency is critical to building the much-needed trust between a customer and a brand.

“Sharing how data is being used anytime a customer creates an account, signs up for marketing communications, or agrees to data sharing reassures customers that their data is being treated securely and compliantly.

“Retailers who can provide this transparency and direct value will enjoy the kind of widespread brand loyalty that comes from more personalised, value-oriented interactions, which can be the key to giving customers the brand experiences they truly want, when they want it, and where they want it.”

On the brand side of things, Dr. Lea Sonderegger, Chief Information Officer and Chief Digital Officer at Swarovski (a SAP customer), added: “AI is undoubtedly a value driver for customers and companies, helping to elevate personalisation at the highest level. Thanks to sophisticated algorithms, we can now better understand our customers as never before, anticipate their needs and, recently, provide a human-like conversational interaction.”


Performance Marketing World

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