AI Conversational Commerce Transforms Retail Shopping

“I want to celebrate our wedding anniversary tomorrow, so I’d like to enjoy a nice wine. Could you recommend something in the 50,000 Korean ...

“I want to celebrate our wedding anniversary tomorrow, so I’d like to enjoy a nice wine. Could you recommend something in the 50,000 Korean won range that even a beginner with little experience drinking wine can enjoy?”

On the 16th, after opening the app for Lotte Mart’s alcohol specialty store, “Bottle Bunker,” and entering this request in the search bar, the “AI (artificial intelligence) sommelier” immediately responded. “Congratulations on your wedding anniversary. There are many wines in the 50,000 Korean won range that are easy to enjoy without pressure. Since it’s a special day, how about adding a romantic atmosphere with a sparkling wine that has delicate flavors and beautiful bubbles?” The AI sommelier recommended five wines. After selecting one, the user could immediately specify the desired store and schedule for product pickup.

The landscape of shopping is changing. The era of entering product names into a search bar and browsing through countless lists is fading, and a new trend is emerging: “conversational commerce,” where people shop by conversing with AI as if asking a personal shopping assistant. Global retail giants like Walmart and Amazon, as well as domestic companies, are rushing to adopt AI-based conversational commerce. A distribution industry source said, “The technological barriers to conversational commerce have been dismantled by the development of generative AI,” adding, “There’s talk that an era is opening where people make impulse purchases persuaded by AI that knows them better than they know themselves.”

◇Walmart and Amazon also focus on conversational commerce

Walmart, the world’s largest retailer, announced on the 14th (local time) that it had formed a partnership with OpenAI, the developer of ChatGPT. The goal is to build a system where users can receive recommendations for Walmart’s groceries or daily necessities through conversations with ChatGPT and complete payments immediately. Walmart CEO Doug McMillon said, “For a long time, e-commerce shopping has been done through search bars and long product lists,” adding, “Now, the game of shopping will change with AI.”

Conversational commerce is spreading across generative AI and distribution companies. Amazon, the world’s largest online shopping company, integrated a chatbot called “Rufus” into its app last year to recommend personalized products. In April, it also unveiled a trial version of “Buy for Me,” a shopping AI agent that recommends products not even listed on Amazon.

Global fashion brand Ralph Lauren partnered with Microsoft (MS) to launch a conversational shopping feature called “Ask Ralph.” If users ask questions like, “I’m going to a concert—what style would be good?” or “How should I coordinate a navy jacket for men?” the service recommends customized outfits considering the user’s preferences and situation, helping them purchase a full-body style at once.

◇Opening consumers’ wallets through conversational commerce

The reason companies are rushing to invest in conversational commerce is clear: it can innovate consumer experiences, prevent customer defection to competitors, and boost sales. Conversational AI provides personalized shopping experiences, increasing consumer satisfaction. A distribution industry source said, “If companies don’t quickly adopt conversational commerce, they could lose consumers to other channels or companies.”

CJ CheilJedang introduced a generative AI-based conversational search service called “Fai” on its online mall, “CJ The Market,” in June. It suggests suitable products for questions like, “Are there any high-protein, low-calorie ready-to-eat meals?” or “What should I eat for dinner tonight?” Within four months of the service’s launch, one in five CJ The Market users had tried it, and the actual purchase rate for AI-recommended products was 28.5%. A CJ CheilJedang representative said, “Considering it’s still early in the operation phase, this is a positive figure.”

Lotte Mart’s AI sommelier is also achieving results. Built on Google’s Gemini, the service saw a 40% increase in pickup reservation usage and a 35% rise in user numbers within four months of its launch compared to the same period before AI adoption. Conversational commerce is establishing itself as a core marketing tool that not only provides information but also boosts purchase conversion rates.