Behind the Numbers: An eMarketer Podcast Summary

Episode Title: Can GenAI Actually Change How People Shop? | Reimagining Retail
Release Date: May 14, 2025
Hosts: Sarah Lebo
Guests:

• Karina Perkins, Retail Analyst
• Yori Wormsler, Tech Analyst

Introduction

In this episode of Behind the Numbers: Reimagining Retail, hosted by Sarah Lebo, eMarketer delves into the transformative role of Generative Artificial Intelligence (GenAI) in the retail sector. Joining Sarah are Karina Perkins from the retail desk and Yori Wormsler from the tech desk. The discussion centers around whether GenAI can fundamentally alter the shopping experience and reshaping the retail landscape.

Setting the Stage: The Rise of GenAI in Retail

Sarah begins by highlighting recent advancements in GenAI, citing Mark Zuckerberg’s assertion that "Facebook's AI tool is like the ultimate business results machine" (01:06), and Amazon's introduction of Nova Act, an AI agent capable of performing autonomous actions on behalf of consumers. These developments underscore the growing influence of AI in automating marketing and shopping processes.

True or False: The episode kicks off with a pivotal question: "Generative AI in retail will change how people shop." Both Karina and Yori agree with a resounding True but emphasize nuances in the extent and nature of this change.

• Karina Perkins (02:11): "AI is causing a shift in the shopping landscape, with tech companies aiming to own the commerce journey."
• Yori Wormsler (03:04): "All parts of the marketing stage are going to be transformed by AI and agents, though consumers will still want final decision-making power."

The Current State of GenAI in the Shopper Journey

Karina outlines the pervasive integration of GenAI across various stages of the shopper journey:

• Discovery: AI-generated ad campaigns and product recommendations.
• Search: Enhanced AI-driven search capabilities.
• Customer Service: AI-powered support and review summaries.
• Loyalty Programs: Personalized AI-managed perks.

She notes, however, that while these applications are widespread, they often encounter consumer friction and a significant focus remains on pre-purchase activities rather than post-purchase pain points (03:47).

Yori adds that while discovery and consideration phases are already impacted by GenAI, backend processes like merchandising benefit significantly without altering the visible shopper experience (04:36).

Impact of Agentic AI on Shopping

Agentic AI, defined as AI entities making purchase decisions on behalf of users, is a key focus area.

• Technologists’ Vision (Yori, 06:19): Agents will anticipate needs, suggest products, and handle time-sensitive or routine purchases, enhancing every stage of the shopper journey.
• Consumer Autonomy (Karina, 07:00): The adoption of agentic AI will vary based on product type. Routine purchases like diapers or dog food may see higher acceptance, whereas emotionally driven purchases like clothing may retain the need for human interaction.

Challenges:

• Trust and Desire (Yori, 05:21): Consumers may be hesitant to trust AI fully with their purchases.
• Enjoyment of Shopping (Karina, 05:46): Many consumers derive pleasure from the shopping process itself and may resist automation.

Overhyped Aspects of GenAI in Retail

Yori argues that automated buying is overhyped, particularly among older demographics who may be reluctant to adopt such technologies (08:35).

Karina contends that seamless personalization is overhyped as current AI often fails to deliver accurate, meaningful recommendations. She cites a survey indicating "one in five consumers say that recommendations are still way off base" (08:35).

Sarah reinforces this by reminding listeners that "80% of shopping still happens in-store," emphasizing that much of the potential impact of GenAI applies to a smaller segment of the market (09:31).

Underappreciated Areas and Advice for Retailers

Yori points out that agentic AI can also transform in-store experiences by leveraging technologies like image recognition for real-time reviews and price comparisons (10:12).

Karina emphasizes the overlooked importance of the post-purchase experience, suggesting that retailers should focus on leveraging AI to simplify returns, enhance loyalty programs, and improve delivery tracking (12:17). She asserts, "Retailers that use AI to fix post-purchase pain points are going to be the winners."

Yori adds that optimizing for generative search will become crucial, as AI agents will rely heavily on accurate reviews, price data, and product specifications to make informed recommendations (13:25).

Advice from Guests:

• Karina (16:16): "Focus on day-to-day frictions, make experience seamless for consumers."
• Yori (17:00): "Focus on first-party data to design better products, market effectively, and enhance personalization."

Future Outlook and Final Thoughts

Sarah reflects on the limitations of current AI integrations, questioning the practicality of AI agents making complex purchasing decisions without human oversight (13:53). Both Karina and Yori concur that while AI can handle mundane tasks, the nuanced and emotional aspects of shopping will still require human involvement.

Yori optimistically highlights the potential for virtual try-ons and augmented reality tools to reduce the need for in-store trials, enhancing the online shopping experience (14:51).

Karina concludes by advising retailers to prioritize solving everyday shopping frustrations with technology before pursuing more ambitious AI-driven transformations (15:38).

Final Takeaway:

• Karina: "Focus on the basics. Get the basics right and then explore transformative shopping experiences."
• Yori: "Prioritize first-party data to ensure effective AI integration and personalization."

Conclusion

The episode underscores that while GenAI holds significant promise for revolutionizing retail, its successful implementation hinges on addressing current consumer hesitations, improving personalization accuracy, and enhancing the post-purchase experience. Retailers are advised to build a strong foundation by resolving everyday shopping challenges before leveraging more advanced AI capabilities.

Notable Quote:

• Karina Perkins (16:16): "Focus on the basics. Get the basics right and once you've got the basics right, then you can start looking at wonderful, transformative new shopping experiences."

This comprehensive discussion by eMarketer encapsulates the current landscape, challenges, and future potential of Generative AI in retail, providing valuable insights for marketers, retailers, and advertisers looking to stay ahead in the digital media landscape.