AI in Retail: Consumers Seek Advice from Artificial Intelligence, Yet Trust Remains Low
Traditionally, consumers relied on friends, family, and online reviews for shopping advice. However, a new player has entered the scene: artificial intelligence. Despite its growing presence in the shopping journey, trust in AI remains low, with less than 40% of consumers expressing confidence in these digital tools, according to a report by McKinsey Podcast.
Trust Issues with AI
Danielle Bozarth, global leader of McKinsey’s Retail and Consumer Packaged Goods Practices, highlighted the skepticism surrounding algorithm-driven channels, particularly generative AI. In a recent episode of The McKinsey Podcast, she noted that younger consumers are also showing limited trust in recommendations from family and friends. Instead, they are increasingly relying on a wider array of information sources, albeit with diminished trust in those sources. This shift presents challenges for brands and influencers attempting to navigate the evolving consumer decision journey.
The changing landscape of information sourcing is prompting brands to rethink their strategies. The research indicates that brand-owned websites receive minimal direct citations in AI-generated responses. As a result, companies are adopting generative engine optimization strategies to enhance how algorithms interpret structured specifications, product details, and frequently asked questions.
Trends Shaping Consumer Behavior
The podcast identified four key trends influencing consumer shopping behavior: a technology-led path to purchase, a broader health revolution, an expanding experience economy, and the rise of the resourceful consumer. Clarisse Magnin, a senior partner at McKinsey, emphasized that consumers are increasingly focused on the overall value of a purchase, extending beyond its initial price.
Magnin described these consumers as “resourceful,” noting their creativity in seeking greater value for their money. They are evaluating factors such as durability, usefulness, repairability, and resale value. For businesses, this means that value must be integrated into products from the outset rather than added later through promotions.
Generative AI is gaining traction in sectors that require more thoughtful purchasing decisions, particularly in travel, beauty, and fashion. This trend is compelling businesses to swiftly adapt their operational and marketing strategies.
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