While many shoppers still enjoy browsing in-store, expectations around convenience and personalisation have evolved dramatically. Retailers are now under pressure to deliver seamless, tailored experiences across both physical and digital touchpoints.
Today, 65% of shoppers favour blended in-person and online shopping experiences over single-channel methods, signalling the increasing need for digital innovation in brick-and-mortar environments.
“Retail hasn’t changed drastically at its core,” says Michael Klein, Head of Retail Product Marketing at Talkdesk. “But when it comes to convenience, selection, personalisation, those are the key disciplines that I see have been evolving over the past few years.”
Retailers are being pushed to meet these demands by offering faster, more tailored services that cater to every whim.
Balancing convenience with immersion
Rapid advancements in mobile commerce, including voice agent support, personalised recommendations, and app-integrated assistance, mean that shopping is now both online and offline.
“Even today where the majority of sales still take place in a physical brick and mortar store, the influence of digital on those sales is well over 50%,” says Klein. ”Consumers are going online to do research, they’re looking for store locations, they’re trying to find the best price, and checking availability before venturing out to a physical store.”
This increased convenience has fueled demands for quicker, more efficient service, with 67% of shoppers now expecting issues to be resolved within 4 hours. To keep up with rising expectations, it’s clear retailers must learn how to effectively use technology to streamline their customer service processes.
The personalisation expectation
Personalisation has become an expected part of the retail experience, given that 76% of shoppers now demand personalised experiences with every purchase. Retailers can benefit significantly by fulfilling these demands, given that 54% of shoppers are more likely to complete a purchase after a personalised support session powered by AI and data analytics.
To meet growing expectations, many retailers are turning to AI agents that can autonomously perform tasks on behalf of consumers. “At the foundation of anything around personalisation, it’s the data,” says Klein. By analysing vast amounts of consumer data in real-time, these agents can anticipate shopper needs and deliver personalised recommendations.
For example, if a customer is browsing for shoes ahead of a summer wedding, an AI agent could take the occasion and season into account - suggesting appropriate styles, coordinating accessories, and even matching items based on past preferences and shared intentions. This ability to blend behavioural data with context results in a faster, more relevant and satisfying shopping experience.
Klein adds that more brands are now investing in zero-party data - a subset of first-party data that customers intentionally and proactively share, often through surveys, quizzes, or preference centres. Unlike third-party data, which can be invasive or unreliable, zero-party data is accurate, current and willingly given. This empowers retailers to offer hyper-personalised recommendations while building trust and transparency with their customers.
AI that feels personal, not automated
Since Amazon introduced Alexa, through the Echo device, to consumers in November 2014, conversational commerce has become a staple in retail. Over a decade later, retailers across the globe are successfully using conversational commerce through chatbots and virtual agents.
It’s taken a long time to get to this point. “Early AI powered experiences were very underwhelming. Quite often if you didn’t know exactly how to speak to the AI agent, you might not get a relevant result. The AI agent may not have been able to provide a valuable response unless your query was very structured and it explicitly matched the information stored in the database,” says Klein.
While significant progress has been made, there’s still room for improvement when it comes to using AI agents for issue resolution. While 72% of shoppers now expect issue resolution in a single interaction, only 49% of retailers offer immediate assistance via chat or voice, according to the Talkdesk 2024 Retail Customer Experience Index. To keep pace with shopper expectations, retailers must continue to evolve and enhance their digital capabilities.
As AI technology improves, AI agents are expected to play an even larger role in the retail experience. Klein says, “Being able to leverage natural language processing and allowing consumers to speak as they would to a human agent is a key element of how these personalised experiences are going to improve, and become more personal and tailored to the consumer.”
Differentiating between leaders and laggards
Klein emphasises that leading organisations are those that have a clear plan for how they want to leverage AI, whether it’s product discovery, or helping a customer to understand what their order status is without having to wait on a phone line. “It’s really the brands that aren’t just doing AI for the sake of AI, but doing AI for the sake of solving customer problems and issues, that are succeeding” he says.
One growing expectation is customer support, given that 89% of shoppers expect retailers to offer support across multiple channels - think email, chat, SMS, voice to meet these expectations, top brands are stepping up by offering personalised communication, whether through tailored recommendations via chat or voice agents, or providing easy appointment scheduling with experts. They’re also using chat transcripts behind the scenes - helping contact centre teams boost productivity, troubleshoot issues faster and ensure consistent, informed service across every customer interaction.
However, many brands are lagging behind: only 51% of retailers currently offer support across more than two channels. This leaves a significant gap between consumer expectations and the reality of service, potentially leading to frustrated customers, missed sales opportunities, and lower brand loyalty.
Connecting the dots between experiences
Today, 73% of shoppers expect interactions across channels to be integrated and viewed as a single conversation by support agents. However, integrating AI across touchpoints remains a significant challenge for brands, as it requires aligning multiple systems and technologies — something which many retailers still struggle with.
Websites, mobile apps, and physical stores all have vastly different user interfaces and customer interaction models, which means maintaining consistency and personalisation across these touchpoints requires a lot of coordination. Maintaining customer security across all of these platforms, which have their own security protocols and potential vulnerabilities, adds yet another layer of complexity.
Klein says that breaking down silos of data is essential for seamless AI integration across touchpoints. “It goes back to the data we have available to us, and how we leverage that data. It’s also being very conscientious of the platforms and the technology that we invest in. If the technology we invest in is only serving one of these channels, then that becomes a bigger challenge for IT departments to connect the dots from the online and the offline space,” he says.
When brands are deciding where to put their technology budgets, Klein suggests they should place heavy emphasis on whether the platforms they’re investing in can help them connect the dots online and offline.
“There are a lot of technologies that are helping customer service, but only from a digital perspective. They don’t bring in the idea of the human agent, the voice agent or the store associate. That’s an area that Talkdesk can help solve because we have the capability to continue that conversation across any of those touch points, whether it starts in digital, voice, or in the store,” he says.
“We can have that customer move from one channel to another without having to repeat everything they just spoke about to the last person or the last digital agent that they were engaged with.”
Technology, people and partnerships
When it comes to investing in technology, retailers should approach it with self-awareness by recognising where they are in their digital journey and acting accordingly. Larger brands may be further along, but smaller ones can still make progress by gradually building up their tech capabilities.
The key is to move slowly, while prioritising data management. “ If you don’t have good data in place, none of this is going to work, because data is the foundation of so much that we do in the world of technology,” says Klein.
Retailers should also understand that they can’t do everything in-house, and remember there is a time and a place for strong partnerships. Klein says, “ In many industries, including retail, everybody was trying to build stuff on their own. They realised that it’s just not feasible, and it puts you at a disadvantage.”
He adds, “While you may have built something that was bespoke to your brand, by the time that technology was put into production, it was time to update the technology because things moved so quickly,” To avoid this, it’s crucial to work together with the right technology platforms and external expertise, whether from system integrators or agencies.
“In my time on the technology side of retail, I quite often talk about a three-legged stool: success comes when you’ve got great technology that you’ve invested in, the people internally to take advantage of it, and you’ve developed partnerships with good systems integrators and agencies that can also bring their expertise,” says Klein. “When those three things are working together in concert, that’s when the magic happens.”
How to leverage AI agents for retail success
Here’s how to make AI agents work for your retail strategy - from enhancing personalisation to unifying touchpoints, smart deployment can boost customer satisfaction and sales. Focus on solving real problems, building a strong data foundation and partnering where it counts.
Today, 65% of shoppers favour blended in-person and online shopping experiences over single channel experiences. Retailers must adapt by integrating digital innovations into brick-and-mortar settings to meet the demand for convenience, selection, and personalisation.
AI agents are crucial for offering personalised shopping experiences. They can analyse vast amounts of customer data in real-time, to provide tailored product recommendations, improve decision-making, and foster stronger customer loyalty.
Shoppers expect a seamless experience across channels, with interactions across multiple touchpoints treated as a single conversation. Retailers must break down data silos and invest in technologies that connect online and offline interactions.
Early AI experiences were often clunky, but advancements in natural language processing are making AI more personal and effective. Retailers should focus on using AI to solve customer problems rather than implementing it just for the sake of technology.
A strong data foundation is essential for successful AI implementation. Retailers must prioritise data management and invest in platforms that can integrate multiple customer touchpoints while maintaining security.
Retailers should avoid trying to build everything in-house. Strategic partnerships with technology providers and agencies can help accelerate digital transformation.
Effective retail AI integration requires the right balance of technology, internal expertise, and external partnerships. When these three elements work together, retailers can create powerful, customer-focused experiences that drive growth.
For more information please visit talkdesk.com
While many shoppers still enjoy browsing in-store, expectations around convenience and personalisation have evolved dramatically. Retailers are now under pressure to deliver seamless, tailored experiences across both physical and digital touchpoints.
Today, 65% of shoppers favour blended in-person and online shopping experiences over single-channel methods, signalling the increasing need for digital innovation in brick-and-mortar environments.
"Retail hasn’t changed drastically at its core,” says Michael Klein, Head of Retail Product Marketing at Talkdesk. “But when it comes to convenience, selection, personalisation, those are the key disciplines that I see have been evolving over the past few years.”
