New research indicates that the majority of online shoppers in the US are concerned about AI tools and demand regulation.

Software company Capterra has surveyed 1,000 online shoppers, most of whom are interested in using AI tools for e-commerce. However, 65% don’t think that AI tools are handling personal data responsibly.

The Federal Trade Commission (FTC) is currently investigating the maker of ChatGPT over whether it has broken consumer protection law by misusing personal data.

The retail industry is certainly at the forefront of the AI revolution, a market which was worth $81.3bn in 2022 and is expected to achieve a compound annual growth rate (CAGR) of more than 21% between 2022 and 2030.

Within the retail sector, AI is rearing its head in the form of personalisation, but this comes at the cost of consumers having to share personal information online.

What are consumers’ main concerns surrounding AI in retail?

The research suggests that AI is generally gaining acceptance among US consumers, who are aware of how AI factors into their everyday lives. More than half have used generative AI and over a fifth have used AI graphics tools.

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However, their worries are concentrated in three areas:

  • Sharing personal information: Most online shoppers think it’s as risky or riskier to share personal data with AI as it is to store payment information in digital wallets or share their medical history on patient portals.
  • Use of customer data: Nearly two-thirds of online shoppers doubt their data will be handled responsibly by AI tools and their providers. The vast majority do not want providers of AI tools to sell their data.
  • Inaccurate information from AI: Online shoppers are well aware of generative AI’s tendency to pass off inaccurate information as truth–known as AI “hallucination”. Nearly everyone (85%) worries they’ll be misled by an AI tool.

A little more than half (55%) of U.S. online shoppers are staunchly against using AI on retail platforms and are unwilling to share any sensitive personal data with AI tools.

This is in spite of personalised data allowing AI to deliver the kind of assistance currently only available through human retail workers.

How should retailers use AI?

  • Select AI vendors with vetted tools and solid data privacy practices
  • Be transparent with customers about how the business will use and protect their data
  • Avoid asking for data that customers don’t feel safe sharing with AI tools
  • Designate a knowledgeable person (or better yet, a team) to handle data hygiene for the company 

A substantial 60% of surveyed shoppers expressed greater confidence in AI tools when human intervention is involved.

Additionally, almost half (42%) of AI enthusiasts are willing to pay for a private version of an AI tool that promises not to collect, store, or monetise the data they share with it.

It’s no wonder that AI is one of the top concerns for retailers currently, many of whom are unsure about how to invest in and integrate the technology into their operations.

When utilised efficiently, AI can offer retailers supply chain forecasting, lower operational costs and smarter markdowns and clearances.