AI ranks high on retail CX 2024 predictions

In looking back at retail customer experience in 2023 a good majority of news and headlines were all about personalization, customer interaction and striving to provide customers what they wanted, where they wanted it (online and in-store) and how they wanted it delivered.

Then artificial intelligence landed big everywhere — in every business sanctum — and from what some CX leaders expect, AI will dominate the retail environment in 2024.

Here's a look at what retail experts are expecting to happen within retail CX this year.

AI and high value outcomes

Ashley Hubka
GM/SVP
Walmart Business

In 2024, businesses will explore how to use AI as more than one-off facilitator of efficiency and productivity. AI will become an integral tool to daily workflows and become a true operational partner. For example, in customer service, AI's ability to 'understand' and quickly answer customers' questions will help them place orders faster. At businesses of every size, the opportunities are enormous. In 2024, businesses must eliminate the gap between discovery and purchase to remove friction.

For example, the skyrocketing popularity of social commerce, which blends social media discovery with eCommerce, will redefine successful sales strategies. Platforms like Instagram Live Shopping, TikTok Shopping, and YouTube Shopping have become vibrant marketplaces. They feature shoppable posts and on-site storefronts that enable consumers to discover and purchase products directly within social feeds.

Expect this to extend beyond retail. LinkedIn already offers native lead generation and it's a short hop to something like in-video actions to bridge the gap between discovery and B2B sales. This shift is more than a trend; social commerce sales are projected to increase from $475 billion in 2020 to $3.37 trillion by 2028. We've entered a new era where brands can create interactive, entertaining content far away from their owned properties or physical locations — and convert viewers to customers in real time. As customers skip from traditional awareness directly to purchase, businesses must be more proactive audience builders and engagers than ever (before) by leveraging existing platforms. Businesses of all sizes will make fostering the growth of their local communities a top priority in 2024. It's of strategic importance and can provide a competitive advantage. As a business, it's a responsibility that we all share to build stronger economies and more resilient communities.

AI will go beyond text-based interactions and gain a "face"

Vincent Yang
Co-Founder/CEO
Firework

As technology continues to advance, we expect to see AI evolve from just text-based interactions. AI will gain a "face," offering visually rich, real-time video-based conversations that will assist consumers at different stages of their buying journey. This advancement won't just be limited to customer support scenarios but will extend to proactive sales and lead generation as well.

Imagine walking into a virtual store and being greeted by an AI assistant who not only knows your style and preferences but can also showcase products in real-time through interactive video. This development will be groundbreaking, transforming how we think of shopping, customer service, and the overall online experience.

AI in retail

Piyush Patel
Chief strategic business development officer
Algolia

Retailers expecting AI to be the magic bullet that will carry their numbers will be disappointed in 2024. Big dollars are being thrown around without the proper strategy in place to extract real value. That being said, those that focus on niche strategic areas — like productivity and search functionality — with the right plan in place will see progress and revenue impact. For example, price watching sites will take shape as AI helps to 'understand' what a consumer is looking for and alert them in their normal workflow.

This applies not only to the consumer, but to the associates in the retail consumer journey. Additionally, assisted shopping systems that will empower the 'stylist' to help match desire with products will become more ubiquitous. As understanding improves in systems, various tasks will be augmented with AI that will help everyone in the path become more efficient. Shopping might even start to see what we in the technology space call 'asynchronous'.

For example, because a consumer bought a product 6 months ago and it usually needs to be refilled, the retailer can alert the consumer to a subscription offering in that time frame. Looking to innovative stores like Reformation that seamlessly combine the best aspects in-person and online experiences, we're going to see a revolution in omnichannel offerings from retailers. For example, in retail, a home improvement store may have the tools a consumer ordered online ready for pick up, but could also offer a 15 minute in-person session on 'how-to' based on their project, so the time saved walking around the store is now spent more valuably. In grocery, the buying experience is already a mix of online and offline. A consumer wants an efficient shopping experience based on a list they created at home, but they also want the serendipity of finding the new holiday flavored cookie for sale or the control to pick their own fruit. We'll see grocery stores capitalizing on that trend with efficient in store pick up and personalized commendations for shopping. If a retailer isn't looking at the full picture of the shopper experience, they are going to get left behind this year.

Consumer optionality

Steve Denton
CEO
Ware2Go

Today's consumers expect a convenient online shopping experience that is tailored to their lifestyle, and that expectation extends all the way to delivery. While historically, the conversation around e-commerce fulfillment was about 2-day shipping, in 2024, delivery optionality will define eCommerce CX. Consumers no longer require every order to be delivered in two days, but instead seek a wider menu of delivery options, including the ability to choose a delivery date, free shipping, real-time tracking, in-store pickup, sustainable shipping and more. In fact, 90% of consumers would forego one-to-two-day shipping in favor of one of these options. To compete for the loyalty of today's connected consumers, brands must stop viewing shoppers as a monolith and instead offer customized shipping options that suit their unique needs — straying from the traditional two-day shipping option as the end-all-be-all in customer experience.

The shift toward standardized in-store technology

Paul Brenner
SVP of retail media and partnerships
Vibenomics

2024 is the year of in-store tech standardization, tackling the market's fragmentation of diverse and disconnected solutions. Providers will adopt open, standardized systems, offering scalability and smooth integration.

Meanwhile, retailers will dive further into digital tech experimentation. Their goal is simple: create a space for advertisers to thrive and shoppers to enjoy a better experience. Through rigorous testing and learning, retailers will refine their digital investments. In this harmony of unity and innovation, retailers and providers aim for an ecosystem where everyone prospers.

Programmatic advertising is transforming, with Retail Media Networks leading the charge. Through first-party data, RMNs have a deep understanding of their shoppers — enabling them to maximize value through programmatic advertising. In 2024, we'll see the rise of 'always on' retail media solutions — an uninterrupted approach via digital channels like social media, email marketing and in-store audio. RMNs will also adopt programmatic solutions to enhance the shopper's experience, create dynamic content and connect with audiences in a more personalized and engaging way.

Next-level on-premise personalization

Jaime Bettencourt
SVP of revenue growth and brand strategy
Mood Media

Primarily next year and moving forward, on-premises personalization will evolve into an immersive journey where AI-driven technologies, like machine learning algorithms, IoT sensors, and beacon technology, provide tailored experiences transcending the boundaries of conventional retail. This will be further enhanced by connecting online data to in-store shopping. Imagine someone stepping into a store for the first time, and screens intuitively adapt to their preferences as they move through the aisles. This technology offers product recommendations aligning with their needs, activating investment and brand loyalty.

Immersive and interactive technologies reshape product discovery by providing consumers with engaging, personalized experiences — drawing from AI learnings from online purchase preferences. These technologies lead to better-informed purchasing decisions, reduced returns and increased customer satisfaction. As these technologies evolve, their impact on product discovery will grow significantly in the coming years. Whether suggesting the perfect top to complement selected pants or curating a shopping adventure that resonates with individual taste, on-premises experiences will be like nothing ever experienced. This next-level personalization, guided by AI, real-time and online data, and beacon technology, will make every visit an exceptional and individualized adventure, bringing retail a new level of convenience.

Omnichannel visibility a need, not a want

Padhu Raman
chief product officer
Osa Commerce

Companies that fail to adopt omnichannel distribution risk disappointing customers and losing sales as consumer expectations for fast, flexible delivery continue rising. To maintain visibility and order fulfillment, retailers need to turn to technology to manage their supply chain across all channels now — not in the next few years. AI and predictive analytics will separate the winners and losers over the next decade across manufacturing and retail. Leaders who harness big data to optimize inventory, forecast demand, control costs, and personalized recommendations will dominate their less analytical peers. Companies that fail to adopt will see spiraling costs and plummeting efficiency.