A recent report reveals that 58% of consumers now use generative AI (Gen AI) tools instead of traditional search engines for product and service recommendations—a significant increase from 25% in 2023. The findings indicate a growing preference, particularly among Gen Z and millennials, for hyper-personalized content and product recommendations driven by Gen AI.
Consumers Embrace Generative AI in Shopping
The Capgemini report, What Matters to Today’s Consumer, highlights how Gen AI is revolutionizing shopping experiences. Approximately 71% of consumers want Gen AI integrated into their purchasing journey, with younger generations leading the demand for hyper-personalized and seamless digital interactions. Nearly half (46%) of respondents view Gen AI’s impact on online shopping positively, and three-quarters of consumers rely on its recommendations—up from 63% last year.
The data also shows that 68% of consumers expect Gen AI to combine search results, social media, and e-commerce platforms into a cohesive solution that simplifies decision-making.
Retailers Recognize Gen AI’s Potential
Seventy percent of companies in the consumer goods and retail sector see Gen AI as a transformative technology, a notable increase from the previous year. However, despite significant investment, consumer satisfaction with Gen AI has dropped from 41% in 2023 to 37% in 2024. This underscores the need for businesses to better understand how consumers want to use this technology.
“Consumers today expect personalized shopping experiences enriched by artificial intelligence and generative AI. They also demand fast and efficient deliveries while becoming increasingly aware of the environmental impact of their purchases,” said Lindsey Mazza, Global Retail Lead at Capgemini. “To remain competitive and build brand loyalty, retailers must adopt customer-centric strategies that leverage AI for seamless yet exceptional interactions.”
Rising Demand for Quick Commerce
Quick commerce (Q-commerce) continues to gain traction, with 70% of consumers now willing to pay extra for express delivery, up from 41% in 2023. On average, shoppers are ready to pay a 9% premium for delivery within two hours. This trend is particularly strong in markets such as India, Germany, France, Sweden, Spain, and the Netherlands, with the U.S. lagging behind.
Sustainability Matters, but Price Sensitivity Remains
Sustainability plays a growing role in consumer decision-making, with 64% of respondents favoring eco-friendly brands and 67% willing to switch stores for sustainable products. However, fewer consumers are prepared to pay significant premiums for such options. While the share of people willing to pay 1–5% more has risen from 30% to 38%, those willing to pay higher premiums have declined over the past two years.
Consumers also value detailed product information, such as carbon footprint labels and nutritional details. Nearly 67% of respondents indicated they might switch products if this information is inadequate.
AI Influencers and Social Media Drive Product Discovery
Virtual influencers powered by AI are becoming more influential, with 25% of consumers trusting their recommendations enough to make purchases. Social media platforms, particularly Instagram and TikTok, are reshaping retail by introducing new products to over 70% of Gen Z consumers, up from 45% in 2023.
In 2024, more than half of respondents discovered new products through social media, compared to just 32% in 2022. Additionally, 40% of consumers use social platforms to occasionally engage with customer service, underscoring their role in resolving issues and providing support.
Online Ads Have a Strong Influence
Nearly 67% of consumers notice ads on websites and shopping apps, which influenced almost one-third of online purchases in the past year. However, in-store advertisements lag behind, mainly due to poor content quality and placement. For instance, 59% of consumers find in-store ads too generic and irrelevant. Over half (53%) prefer personalized ads, such as interactive displays in shopping carts or digital mirrors.
To address these demands, retailers are increasingly investing in Retail Media Networks (RMNs) to enhance advertising engagement.
Loyalty Programs Struggle to Retain Customers
Despite loyalty programs, over 53% of consumers frequently switch brands or stores. The main reasons are dissatisfaction with customer service and a lack of personalized offers. The report emphasizes that retailers must focus on building customer loyalty by aligning their strategies with evolving consumer preferences.
Source: Manager+
