Retailers Find New Ways to Level Up Marketing with ChatGPT

Generative AI has quickly become a booming industry, and retailers are taking notice. Throughout the retail marketing space, executives and agencies are rushing to figure out how to use OpenAI’s ChatGPT and similar technologies to their advantage.

Sephora became an early leader in the space when it created an AI-powered virtual assistant to make product recommendations and support the customer journey. Since then, a number of other major retailers have followed suit, using AI to generate new content for blogs, captions, images, and videos on social media, as well as power features like integrated chatbots to enhance their mobile shopping experiences.

Implementing generative AI gives retailers the opportunity to level-up their marketing strategy at scale, and when done right, it can enhance the customer experience, says Shekar Raman, CEO and cofounder of Birdzi, a company that brings AI and customer engagement to supermarket chains.

Already, Raman is seeing retailers use generative AI to generate more targeted advertising copy and personalized messaging for email marketing. With AI-enabled tools like ChatGPT, companies can instantly personalize individual messages and promotions and also automate basic marketing processes to save time and money.

“We have only recently started seeing some announcements about the use of ChatGPT in grocery,” Raman says. “I can imagine using ChatGPT to come up with one-liner ad verbiage to best describe a product or suggest subject lines for an email based on the content, and that is just the start.”

Rather than processing large amounts of data manually — which takes time, but is also often necessary to successfully understand individual customer behaviors and trends — retailers can use AI tools to analyze and pull important data automatically.

While Raman cautions that retailers shouldn’t solely rely on AI models like ChatGPT for data analysis, he says using these tools can be a time-saving strategy. The approach works best when retailers use generative AI tools alongside their customer intelligence platforms.

Powering Up Website Bots

One of the most obvious use cases for generative AI in retail has to do with improving the customer experience with chat. ChatGPT gives retailers a way to ensure that every conversation a customer has through a website chatbot is valuable, making customers feel like they are connecting with a human rather than just a bot.

“Think about how many customer relationships are saved by accurate real-time information. Have you ever gotten stuck in a FAQ black hole where you are directed to the wrong answer over and over? That is frustrating and it makes some people give up altogether,” Raman says. “This retail technology saves customers from those frustrating interactions.”

While OpenAI’s ChatGPT is currently the most well-known player in the generative AI space, a number of other companies are launching competing solutions, some of which are directly targeted at the retail market. For example, Microsoft made its chatbot debut with the launch of a new Bing last month, right around the same time Google announced its AI chatbot, Bard. Meta has developed a language model called Galactica that will initially be used by scientists and researchers, but could someday have wider applications.

Then there’s the lesser-known startups, like Anthropic and You.com, which are coming out with their own AI-powered chat tools for marketers and the general public.

Raman says it’s a misconception that generative AI will take away jobs from people. The reality is that this type of innovation can create even more jobs, especially within the retail marketing space.

“Excellent customer service and elevated shopping experiences lead to business growth, which leads to more jobs. And while customer support is one of the best uses for ChatGPT, it still needs human input and monitoring to make sure information going to the customers is accurate,” Raman says. “Additionally, this automated type of customer support frees up customer support specialists to put more time and energy into valuable in-person customer interactions.”

While most of the talk around AI currently has revolved around content generation, Raman sees a future where the technology is more focused on preventing customer loss by providing shoppers with accurate information in real-time, so they don’t drop out of the purchase funnel.

“As with most innovations, I think there will come a point when retailers will see they have no choice but to embrace it,” Raman says. “I also expect that retailers will find new and more creative ways to leverage the technology using it to analyze customer behavior and make informed decisions across the retail enterprise.”