How retail chatbots can personalize shopping experience

As online shopping grows, with estimated global retail sales of $32.8 trillion by 2026, retailers seek new ways to engage with customers and enhance their shopping journey. One such solution is a retail AI chatbot.  

In this blog, we will explore how retail bots can transform the shopping experience for your customers, making it more enjoyable, convenient, and tailored to their preferences. 

What is a chatbot for retail? 

They can be integrated into various websites, mobile apps, social media, and chat apps, such as Messenger, Instagram, Viber, WhatsApp, or Kakao, to assist customers throughout their shopping journey and create an omnichannel experience. 

They are excellent at guiding customers through the buying process and helping reduce carts abandoned by providing timely support. 

Retail chatbots help drive conversational commerce as a perfect mix of meeting modern customer expectations on the one side while improving customer satisfaction on the other.  

Types of chatbots for the retail industry 

Shopping chatbots that are available to meet various customer needs and improve the shopping experience usually fall into one of two broad categories: 

1. Rule-based chatbots

Rule-based chatbots are powered by pre-defined rules or decision flows and are programmed to assist with a series of options. These rules dictate how the chatbot should respond to a specific user input or scenario.  

Even though they do not learn from user interaction or adapt to new information over time, they are well-suited for handling routine and predictable tasks, such as providing standard product information and frequently asked questions like return policies or order tracking updates. 

Imagine this scenario: your business often gets more customer inquiries on open hours or return policies than human agents can handle. Implementing rule-based chatbots helps you provide 24/7 customer support with consistent responses, reduces customer wait times, and frees time for your agents to focus on more complex inquiries. 

Other benefits of using rule-based chatbots in retail are: 

• Scalability – They can handle a large volume of routine queries simultaneously. This is particularly valuable during peak periods such as Black Friday, Cyber Monday, or Singles’ Day sales. 
• Customization and control – Your business completely controls your rule-based chatbot’s rules and decision-making process. You can tailor the chatbot’s responses to align with your brand identity, industry requirements, or other standards. 
• Cost-effective – They can reduce the need for live agents and reduce costs. 
• Quick deployment – Rule-based chatbots are relatively easy and quick to deploy since they rely on predefined rules. 

2. AI-powered chatbots

AI chatbots use AI, machine learning (ML), and natural language processing (NLP) to understand users’ intent and respond to an inquiry in a conversational way. They can learn from data, adapt to user inputs, and improve their responses. 

Let’s take the beauty sector, for example. Your retail AI chatbot can give them tips on applying products, what skin type the product is best suited for, get information on skin care routines, and suggest other similar products they might like, creating an interactive and customized shopping experience. Our research shows that all generations prefer receiving personalized messages from the brand. 

The benefits of conversational AI chatbots in the retail industry are numerous, to name a few: 

• Continuous learning and improvement – AI algorithms allow chatbots to continuously learn from interactions, adapting and improving their responses over time. 
• Data-driven insights – AI-powered chatbots collect and analyze vast amounts of customer data, providing valuable insights into preferences, behaviors, and trends that can help drive increased sales, improve conversion rates, and increase revenue.  
• Personalized shopping experience – This includes everything from personalized product recommendations and context-aware conversations to awarding loyalty points, tailored discounts, helping in the decision-making process, and gathering feedback. They can even suggest nearby stores with product availability to enhance offline sales. 

Chatbot use cases in retail 

There is no better way of understanding the value of retail bots than seeing how they can be applied in the real world. Here are a few examples: 

Unilever: 14x higher product sales

Unilever was looking for a new and unique approach to its promotional efforts. After some research, they realized that the best way to promote the products was to approach the customers in a way they’re familiar with and mimic how such products get recommended organically. 

Result: 14x higher sales with a chatbot campaign that promoted product awareness and generated interest 

Salmoiraghi & Vigano: 100% CSAT score 

Salmoiraghi & Vigano wanted to digitally transform their business to improve and personalize customer service, so they chose WhatsApp as their starting point. With the help of our customer experience team, they also built an intuitive chatbot with Answers.  

Result: 46% of customers using the WhatsApp chatbot for support 

Farm Superstores: 60% reduction in operational cost

Farm Superstores was looking for digital-first solutions that would help them accommodate changing consumer needs and enhance their customer experience. 

They implemented a WhatsApp Business chatbot to answer frequently asked questions and offload repetitive customer queries from agents. 

Result: 60% reduction in operational costs thanks to seamless integration with existing systems and fast responses 

Now, let’s look at some tips and best practices to help you deploy similar effective chatbots for the retail industry. 

Tips and best practices for chatbots in retail 

1. Define clear goals and objectives 

Prioritize a clear understanding of your business objectives and identify key customer pain points. With this knowledge, tailor your chatbot to address them effectively. Don’t just implement a chatbot because everyone is doing it.  

2. Craft the right chatbot persona

Consistency in user experience is one of the key building blocks when building trust and brand loyalty. This means that even your chatbot persona should align with your brand’s tone and values. If your brand’s personality is fun and playful, make your chatbot like that; your customers will love it.  

How LAQO shaped Pavle’s character into a human-like bot with a great sense of humor in line with their brand personality:

3. Choose the right provider to build your chatbot 

When selecting a provider, you should review client feedback and examine their portfolio to ensure they have relevant experience and proven results.  

Consider Infobip Conversational Experience Orchestration Platform (CXOP), which represents the next evolution in chatbot technology by combining agentic AI with unified data and automation. CXOP lets businesses create chatbots and conversations that understand customer intent and adapt in real time. It also allows humans and AI to work together smoothly, so complex issues get resolved faster. 

This unified platform improves customer engagement by delivering personalized, goal-oriented conversations at scale while reducing response times and operational costs.