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(Bloomberg) — British shoppers’ frustration with chatbots and other artificial intelligence features could be costing retailers billions of pounds, a study found.
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Retailers may have lost £4.9 billion ($6.4 billion) of sales in the past 12 months as customers cut spending due to negative experiences on websites, according to the Centre for Economics and Business Research. An estimated £3.7 billion of sales may also have been lost due to customers then sharing their views with others. The total is equivalent to about 6% of online spending, CEBR said.
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The findings come as more companies adopt AI tools to try to boost sales at a critical time, as the UK retail sector grapples with higher payroll costs and fragile consumer confidence.
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Marks & Spencer Group Plc introduced a tool last year which advises shoppers on their outfit based on body shape and style preferences, while grocer J Sainsbury Plc struck a five-year deal with Microsoft to use its AI technology to build more interactive shopping experiences.
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In the US, Amazon.com’s AI-powered tool suggests products to customers who feel overwhelmed with options on its site.
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But the move toward tailored experiences using AI has drawbacks, according to the CEBR research. For example, despite efforts to boost the conversational abilities of chatbots, 40% of online shoppers who interact with these digital assistants still have negative experiences, it said, citing its survey of 1,000 UK adults that was commissioned by consumer review company Trustpilot.
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This may stem from the sentiment that chatbots are obstructing or replacing access to human help, the study found. More advanced AI products such as automatic checkouts and fraud detection systems show higher satisfaction rates.
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While AI tools can make shopping easier, “they can just as easily turn people away,” said Carrie Ryan, chief strategy officer at Trustpilot. “It’s vital that businesses invest the time and energy now in getting AI experiences right.”
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