The capabilities of artificial intelligence (AI) technologies are exploding after many decades of promise. Already shoppers around the world are utilising voice applications, visual search and a menagerie of smart connected devices around their homes, landscapes and even their bodies.
The revolution has already begun but there is a still a very long way to go as AI technologies take up the mantle of driving transformation across sectors and experiences. A critical component in creating successful transformation strategies is to understand the consumer’s perspective.
To enhance our understanding of how consumers accept, understand and trust AI in their daily lives, OMD has invested in the Retail Revolution research initiative which began in 2017. It has tracked consumer attitudes to rapidly changing technologies to understand barriers to adoption, the new influences on purchase decisions, who is more or less trusted in this environment and opportunities for brands to engage through these new capabilities.
OMD’s Retail Revolution seeks to diagnose the challenges and opportunities from the consumer’s point of view, to plot a path forward for brands that has the most potential to transform their business. Patterns of behaviour differ around the world and some markets will be ready for innovation before others.
A narrative has been built that states the capture and utilisation of data has been purely a negative for consumers with no perceived benefit to them. The positive side of the story – that information can make products, services and experiences better and at lower cost without any personal data being exported – has been lost. It is that personal data that powers development – they are the most tangible example of data being used to empower the consumer to make better purchase decisions or simply a more frictionless purchase.
In OMD’s latest report, available now, the research showcases:
- How attitudes and behaviours are defined by a trust gap
- How to close the trust gap
- How trusted AI services address marketing challenges through the 2020s
The good news is that consumers are still engaged with these technologies and are excited by their potential. OMD’s latest phase of research shows how across 18 different scenarios for benefits during the retail experience, AI technologies scored higher than either in-store or online shopping: on average 65% of respondents say AI interactions make their life easier. And, people are increasingly familiar with AI – between 2017, 2019 and 2021, familiarity has jumped from 40% to 51.5%. Furthermore, new technology usage and ownership has increased; between 2019 and 2021, the greatest adoption growth has been from digital assistants, smart TVs and smart speakers, with 61% of smart speakers now being owned for over a year compared to only 25% of 2019. People’s use of voice assistants has become a familiar part of everyday life, 32% 2021 versus 26% in 2019.
However, trust is a key factor for how consumers value brands and retailers and their use of customer data. Over the last two years, we’ve seen retail brands gain people’s trust, while media and news brands have lost it: 42% of respondents cite retail brands as trustworthy enough to make decisions on their behalf, indicating a progressive attitude to AI-based utility as part of the purchase decision.
Brands will need to close the trust gap across generations to make AI technologies scale to their full potential. 61% of Millennials are familiar with AI, with 57% of them trusting it vs 25% of Baby Boomers that are familiar with AI, with 30% of them trusting it.
OMD’s report highlights the opportunities for brands to unlock data to create better interactions and relationships.
- Respondents are most willing to share their data for quick and easy transactions or purchases, more personalised experiences and paying less for a product or service.
- Respondents are also most open to share data with brands and retailers on lower priced items that are bought frequently, such as groceries, drinks and clothes – potentially because of familiarity of loyalty point schemes or lack of perceived impact.
- Respondents are most uncomfortable with their data being shared with different companies. However, if their data is anonymised or shared by a trusted brand their comfort increases.
Ultimately, data unlocks the next capabilities of smart technologies for brands and consumers.
OMD has identified five key takeways from this latest phase of research:
- There is now a need to drive utility at scale with AI and new technology applications.
- New technology when done properly drives relevancy for consumers and enhances brand values. Brands should be thinking about how they can bring the application or experience back to their brand’s core values and how this can be leveraged across media and marketing communications.
- Data becomes increasingly important in a cookie-less environment and to build next-level technology experiences. Brands need to focus on the data that is most relevant to them building out a strategy that addresses consumer concerns, a valuable and easy to understand data exchange, as well as map how the data can drive relevance over time for both the brand and consumer.
- Data-sharing needs to be rebranded. To make the prospect of sharing data a measurable and compelling value exchange, consumers need to see brands convert concerns into benefits. Brands can promise to use data to learn about customer behaviour patterns – for better predictions around personalised offers or to apply more relevant options in communications.
- Recapture attention and permissions through personalisation. Customisation is a powerful driver across the retail spectrum, converting attention into relevant promotions.
The latest research report from the Retail Revolution series can be downloaded at omd.com/emea.