Study reveals UK consumers' mixed views on AI in retail

Recent research conducted by Zoho Survey highlights that over half of consumers see no impact from AI personalisation in retail, underscoring the need for improved engagement.

The study finds that whilst AI technology is increasingly adopted by retailers, 53% of participants perceive AI-driven personalisation to have no effect on their overall shopping journey. This insight suggests that current AI strategies might be falling short of consumer expectations or needs.

Retailers, including major brands such as Amazon, have embraced AI to enhance personalisation, with some attributing a significant proportion of sales to these technologies.

However, only a small fraction, 8%, of survey respondents feel that AI has greatly enriched their shopping experiences, while 29% affirm a slight enhancement. This gap indicates a potential misalignment between AI deployments and consumer desires.

The preference for human input remains strong among consumers, with 73% favouring human insights over AI recommendations, while merely 7% express complete trust in AI-driven suggestions. Such figures point to a continuing reliance on human interaction in the retail sector.

Despite these reservations, consumer frustration with AI in retail is minimal; 78% of respondents report no frustration, although 22% indicate challenges in achieving seamless, user-friendly AI experiences. This reflects ongoing issues in integrating AI smoothly into consumer interfaces.

Furthermore, the survey reveals that 35% of consumers consider it essential for brands to offer human customer service representatives instead of relying solely on chatbots, voicing distrust toward brands that lack human support options.

Overall, 62% of participants describe their encounters with advanced retail technologies, such as AI-driven recommendations, self-checkout kiosks, and chatbots, as positive, citing enhanced service speed and efficiency. Still, 9% report negative experiences, highlighting frustration with automated systems, particularly when queries are left unanswered.

Sachin Agrawal, Managing Director of Zoho UK, remarks: "AI has proven itself to be a useful business tool when used efficiently, but our data shows that the technology is falling short of consumer expectations for meaningful, tailored interactions in the retail sector." He further notes the challenge for businesses to go beyond the technological hype and centre their efforts on customer-centric strategies.

Agrawal advises retailers to critically evaluate customer touchpoints, assess digital maturity, and adapt AI applications to align with customer value expectations. "As AI technology becomes more central in retail, businesses need to look beyond the technology hype and focus on what matters most, the customers. By mapping out customer touchpoints, assessing digital maturity and optimising areas where AI adds value, businesses can unlock its full potential. However, moderate expectations should be set and businesses should scale gradually to regularly evaluate if models need to be adjusted to deliver further ROI," he states.

With the Christmas season approaching, Agrawal comments further: "In the build-up to the Christmas period, brands have the opportunity to leverage AI in a way that streamlines shopping and elevates the customer experience. However, AI should be more than efficient. Its output should feel personal, respect consumers' data privacy and complement human touchpoints. If consumers aren't feeling the benefits, retailers should consider rethinking their approach to help make AI a trusted part of the retail experience."

This research offers valuable insights into the perceptions of UK consumers regarding AI-driven personalisation, underscoring the challenges and opportunities present in refining AI strategies to better serve the retail sector.