MUMBAI: Information overload is causing frequent abandonment in retail, CPG and travel purchases, according to a study by Accenture. Retail, CPG and travel companies can increase customers and revenue by using generative AI to improve the entire buying process.
The study, based on a survey of 19,000 consumers across 12 countries, including India, highlights the issue of “information overload”, with 76% of Indian consumers saying they feel overwhelmed with too many choices and 74% being bombarded with ads, resulting in 88% abandoning a purchase in the last three months of 2023.
Accenture's research report, titled “The Empowered Consumer,” offers new insights into consumer decision-making experiences across retail, travel and consumer goods industries. With competing claims, messages, ads, options, recommendations, algorithms and apps, it highlights the urgent need for brands to harness the transformative power of generative AI (gen AI) to reduce the “noise” around decisions and drive higher engagement, loyalty and sales.
The survey also found that a majority of Indians (67%) believe the time and effort required to make a purchasing decision has not improved, but rather increased – of these, 40% believe it has become more difficult to buy, 28% believe there has been no change, and 33% believe the time and effort required to make a purchasing decision has decreased.
Looking across categories, the study also points to the challenges consumers experience when making purchasing decisions, and this is not limited to big-ticket items: for example, buying snack foods is harder than buying the rest of the week's groceries, buying moisturizer is as hard as buying a washing machine, choosing to buy probiotics is easier than choosing a loan, and buying any type of drink is as hard as booking a trip.
Vineet R Ahuja, MD, head of strategy and consulting, Accenture India, said: “Our research reveals that Indian shoppers are experiencing greater 'decision stress' at every stage of the buying journey. Consumer-facing businesses need to rethink how they brand and market their products and services to help shoppers cut through the noise and make confident purchasing decisions. With new technologies such as generative AI, there is a huge opportunity to not only leverage data but also be more human in ways that weren't possible before.”
Reinventing the age of generative AI: The report states that empowering consumers through generative AI, other technologies, and new ways of working will change the way people think about brands. Companies can make fundamental changes to discovery, conversion, and loyalty, reinventing the decision-making process, relationships with consumers, and their role in their lives. Early mover advantages will be especially important for consumer-facing companies looking to capture value from generative AI at speed and scale across all parts of their business.
Amneet Singh, managing director, product head, Accenture India, said, “Overall, leveraging generative AI and AI-powered advisors in the retail and consumer goods industry can help companies understand their customers better, deliver more relevant and engaging experiences, and drive business growth. In fact, it offers an opportunity to capture the entire buying journey – from inspiration to ideation to transaction – as part of one seamless, natural conversation.”
According to the report, consumers themselves are increasingly looking for ways to reduce their workload and are realizing that generative AI has the potential to take over some of the work. Based on conversations with executives across industries, Accenture said it expects to see rapid and large-scale adoption of generative AI-powered advisors by consumers over the next two years. In fact, the majority of survey respondents in India (82%) said they would be open to using conversational generative AI solutions for advice, support, guidance, recommendations and inquiries while shopping.
The report also highlights the importance of looking holistically at core business processes and using generative AI to unlock value at scale. For example, innovative travel companies are considering how reinventing the booking process can be the catalyst for unlocking value from the entire travel experience.
Deepen consumer relationships: Getting the basics right is essential to delivering a shopping experience that keeps consumers coming back. Research shows that while eight in ten Indian consumers (79%) find parts of the shopping experience fun or exciting, 74% feel frustrated or disappointed when the product they want to buy is out of stock. Businesses have an opportunity to use generative AI tools and assistants to enhance value exchanges with consumers, bridging the trust gap and fostering loyalty in the process.
