"The next phase of AI is not just about talking; it is about doing and becoming a personal assistant for everything." - Mustafa Suleyman, Co-founder of Google DeepMind
Shift from keywords to chat
Discovery in online retail shopping is moving from keywords to conversational tools like ChatGPT. These models guide users on what to buy and where to find the best prices, often bypassing traditional retail apps entirely. The trend, if it holds, could bring a tectonic shift to the sector's dynamics.
Optimising for generative engine
Retailers use generative engine optimisation to stay relevant. Since AI provides limited answers, exclusion from these short response lists means a total loss of digital visibility for brands and products. Thus, GenAI seems to be now holding a life-and-death power over retail outlets.
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Refining data for clarity
Myntra and Ajio are updating metadata to help AI understand products better. Improving details on fit and fabric ensures catalogues are easily read and surfaced by various large language models.
Automated commerce
New tools allow AI to handle orders directly. Platforms like Zepto and NPCI are integrating chat with UPI to make the shopping journey a seamless and conversational experience for users.
Legal hurdles in AI transition
The shift causes friction and legal battles. IndiaMART has sued OpenAI over search exclusions, while Amazon restricted AI agents from making automated purchases on behalf of users to maintain control. The judicial interventions over these cases will decide the future direction in many ways.
Summary
Retailers are transforming digital strategies to stay visible as shoppers shift from traditional search engines to AI chatbots. By refining metadata and experimenting with generative engine optimisation, platforms aim to capture traffic from AI agents that now influence a significant portion of global e-commerce sales.
Food for thought
Will smaller brands eventually disappear if AI agents only recommend the top three products to a user?
Check our posts on AI and retail; click here
AI concept to learn: Generative Engine Optimisation
This strategy makes content visible to large language models rather than traditional search engines. It involves structuring product data so AI agents can easily recommend specific items during a conversation. This approach focuses on how models process and rank natural language answers instead of simple keywords.
[The Billion Hopes Research Team shares the latest AI updates for learning and awareness. Various sources are used. All copyrights acknowledged. This is not a professional, financial, personal or medical advice. Please consult domain experts before making decisions. Feedback welcome!]
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