shopping

Amazon is joining a growing list of vendors that are offering retailers and their customers a generative AI-based shopping assistant, the latest example of the e-commerce giant’s efforts to infuse its products and services with the emerging technology as it competes with the likes of Google, Microsoft and Meta.

The company this month introduced Rufus, an AI chatbot that is designed to help users with their shopping on Amazon by answering their questions, making recommendations, and helping customers find products they may not have thought of.

The AI model is trained on a range of data, from Amazon’s broad product catalog and customer reviews to community Q&As and information on the web, according to Rajiv Mehta, Amazon vice president of search and conversational shopping, and Trishul Chilimbi, vice president and distinguished scientist for stores foundational AI at the company.

“Rufus generates answers using relevant information from across Amazon and the web to help customers make better, more informed shopping decisions,” Mehta and Chilimbi wrote in a blog post. “It’s still early days for generative AI, and the technology won’t always get it exactly right. … Customers are encouraged to leave feedback by rating their answers with a thumbs up or thumbs down, and they have the option to provide freeform feedback as well.”

Retail and Generative AI

Retail has become a key target industry in these relatively early days of generative AI.

“As the retail industry witnesses a shift towards a more digital, on-demand consumer base, AI is becoming the secret weapon for retailers to better understand and cater to this evolving consumer behavior,” Luq Niazi, IBM Consulting managing partner for industries, wrote in a blog post. “With the rise of highly personalized online shopping, direct-to-consumer models, and delivery services, generative AI can help retailers further unlock a host of benefits that can improve customer care, talent transformation and the performance of their applications.”

Niazi noted that in a recent survey of CEOs, IBM found that 42% of top retail executives expect AI technologies – including generative AI, deep learning, and machine learning – will deliver financial results in the next three years.

A Nvidia study found that 98% of retailers surveyed plan to spend on generative AI technologies in the next 18 months, with the report’s authors writing that the retail industry is on the cusp of a transformation driven by artificial intelligence. With the highest potential for AI and analytics among all industries, the retail and consumer packaged goods sectors are poised to harness the power of AI to enhance operational efficiency, elevate customer experiences, and drive growth.”

Offering generative AI shopping assistants is a popular avenue in retail. Major vendors like Google and ecommerce companies, such as Walmart and Mastercard, in recent months have rolled out such tools. In addition, startups are jumping into the mix, such as BitHuman with its full-size, human-like AI agents.

Amazon’s Growing AI Efforts

For Amazon, Rufus is the latest step in the company’s aggressive push to infuse generative AI throughout its services and internal operations. The company in November 2023 unveiled Q, its generative AI-powered chatbot, and expanded the use of AI in a range of Amazon Web Services (AWS) offerings.

A couple of months earlier, Amazon also announced it was investing $4 billion in Anthropic in a deal that calls for the startup to increase its use of Amazon technologies and AWS cloud services and gives Amazon a stake in the smaller company. Amazon CEO Andy Jassy at the time wrote in a post on X (nee Twitter) that “AWS will now be Anthropic’s primary cloud provider and help build, train and deploy its future foundation models on [Amazon’s] Trainium and Inferentia chips.”

Like many of its competitors, Amazon is beginning to see a return on the money in the company is investing in generative AI and large-language models. The company last week reported fourth-quarter net sales of $170 billion, up 14% year-over-year.

Jassy pointed to a number of reasons for the strong holiday-quarter showing, saying that “AWS’s continued long-term focus on customers and feature delivery, coupled with new genAI capabilities like Bedrock, Q, and Trainium, have resonated with customers and are starting to be reflected in our overall results.”

Amazon’s AI push and the strong quarterly results generated positive reactions from industry watchers.

“I would expect that the recent state of generative AI investments should eventually lead to strong return on investment,” Krishna Chintalapalli, portfolio manager at shareholder Parnassus Investments, told Reuters.

Rufus in Beta

Amazon launched Rufus in beta to a small set of customers via Amazon’s mobile app, with plans to roll it out to more customers in the coming weeks. Initial beta customers can start typing or speaking their questions into the mobile app’s search bar, which will trigger a Rufus chat dialogue box to appear at the bottom of the screen.

By expanding the chat box, users can see the answers, tap on suggested questions, or ask follow-up questions in the dialogue box. They can move from Rufus to their traditional search results by swiping down, sending the chat dialogue box to the bottom of the screen.

“With Rufus, customers are now able to shop alongside a generative AI-powered expert that knows Amazon’s selection inside and out, and can bring it all together with information from across the web to help them make more informed purchase decisions,” Amazon’s Mehta and Chilimbi wrote.