. The market has seen a significant increase in the recent past and is predicted to grow significantly during the forecasted period as well.
The global market for
generative AI in e-commerce encompasses solutions & services that strengthen artificial intelligence to create new content like data, images, & text from patterns & input data. In the e-commerce sector, generative AI improves customer experiences by providing tailored shopping journeys, optimizing inventory, pricing, & fraud detection, among other applications. It's a turning point in crafting personalized, efficient, & effective solutions for the e-commerce industry globally.
The market gains momentum owing to the increasing demand for personalized shopping, the necessity for better inventory management & pricing strategies, & the increasing use of AI & machine learning in the e-commerce sector, it is anticipated to do the same over the forecasted period.
According to Businessolution, generative AI is revolutionizing the e-commerce landscape. Currently, 51% of e-commerce businesses utilize AI to enhance customer experience, with AI-driven solutions set to improve consumer satisfaction by 25% by the end of 2023.
The cost-efficiency of AI is significant, as AI chatbots reduce customer care expenses by 30% compared to human agents. Furthermore, 90% of organizations already using AI are planning to leverage it for sales forecasting. By 2027, 80% of retail executives expect widespread adoption of AI-driven intelligent automation.
In fact, 55% of e-commerce companies generate high-quality leads using AI chatbots, contributing to a 35% share of Amazon’s revenue. Chatbot interactions are notably effective, with response rates reaching 40%, and nearly 90% of these interactions are rated positively or neutrally. AI-powered technologies such as virtual assistants and chatbots are already in use by 40% of enterprises across the US, EU, and China. In the U.S., 47% of customers are open to purchasing through chatbots, while 34% prefer chatbots or virtual assistants for query resolution.
Additionally, 43% of companies plan to reduce staff due to AI integration, underscoring its transformative impact on labor costs. As AI continues to evolve, 44% of private-sector businesses are expected to invest in AI technologies in 2023, marking a significant trend toward automation.
Market Dynamic
Generative AI provides e-commerce businesses with a way to automate tasks such as inventory management, pricing optimization, & fraud detection. This streamlines operations, saving both time & resources. A major driver behind its adoption is the rising demand for personalized shopping experiences. By analyzing customer data,
generative AI can create customized product recommendations & shopping journeys, improving customer satisfaction & loyalty.
Further, the cloud-based deployment of generative AI provides a fast & cost-effective way for e-commerce businesses to grow without heavy investments in
hardware. With the evolving data generated by these businesses, advanced analytics tools are important, and generative AI steps in to provide real-time insights & recommendations based on this data.
However, Generative AI solutions can impact budgets for small-medium e-commerce businesses. Using such AI involves customer data, raising privacy concerns & compliance issues with regulations like GDPR. Technical expertise is needed for development, impacting adoption for some. Integrating generative AI into existing e-commerce systems is complex, particularly for those with complex IT setups.
Research Scope and Analysis
By Deployment
During the forecasted period, a significant share of the revenue is anticipated to be generated by the cloud-based segment, as this category includes cloud-based generative AI solutions offered as software-as-a-service (SaaS), effectively managing diverse aspects of e-commerce such as website hosting, inventory control, payment processing, & customer data storage. Such platforms allow online stores to build & look into their digital presence in the cloud, providing tools for crafting & managing e-commerce websites, along with essential services like storage, processing capacity, & database management.
Moreover, the on-premises segment is also anticipated to have significant growth in the generative AI in the e-commerce market during the forecasted period. This is due to the significant advantages of on-premises implementations, which enable greater flexibility in adapting AI models & algorithms to align with specific business needs. This level of customization proves crucial for e-commerce enterprises focusing on to differentiate their AI-generated content or algorithms.
By Technology
In 2023,
machine learning is a key technology in the field of generative AI for the E-commerce market, as it plays a critical role in crafting personalized product recommendations, a major aspect of the industry. Machine learning algorithms showed their prowess by carefully analyzing large volumes of data to uncover valuable patterns & trends.
This valuable insight is then used to offer customers suggestions for products that align accurately with their individual preferences. This development holds significant importance in the world of online shopping, as modern consumers have come to anticipate shopping experiences that are precisely customized and hold personal significance. All the factors and trends are anticipated to prevail throughout the forecasted period, driving growth of the segment as well as the market.
By Application
During the forecast period, the B2C segment is anticipated to take the lead in the generative AI in the e-commerce market. B2C, which stands for business-to-consumer, includes online interactions between companies & individual customers, which covers selling goods & services directly to end-users using web technology.
Further, the integration of generative AI solutions has significantly expanded customer support services. Generative AI speeds up tasks like generating text, recommendations, or comments, benefitting e-commerce companies. Prioritizing improved customer support & quick responses to queries on e-commerce platforms are major drivers behind the growth of the B2C segment.
Furthermore, the B2B segment is anticipated to notice substantial growth throughout the projected period. B2B, or business-to-business, applies to digital transactions between companies, using web-based tools for exchange. Generative AI algorithms & models hold great potential for improving B2B operations, particularly in sales & other management services.
The Global Generative AI in E-Commerce Market Report is segmented on the basis of the following
By Deployment
By Technology
- NLP (Natural Language Processing)
- Machine Leaning
- Computer Vision
- Augmented Reality
- Speech Recognition
By Application
- B2B
- B2C
- Personal
- Seasonal
- Business
- Others
Regional Analysis
In 2023, the North American region holds a significant market share, commanding
about 39.4% of the total revenue in the Global Generative AI In E-Commerce Market. With a high caliber of advanced technologies & the concentration of key industry players, North America stands as the leader in the global generative AI in the e-commerce market. As the USA & Canada are anticipated to significantly contribute to this region's advancement. The growth in consumer demand for customized and streamlined shopping encounters is developing the integration of generative AI solutions within North America's e-commerce sector. Furthermore, the growth of investments in AI & machine learning technologies in the region is encouraging to innovate & fuel the market expansion.
By Region
North America
Europe
- Germany
- The U.K.
- France
- Italy
- Russia
- Spain
- Benelux
- Nordic
- Rest of Europe
Asia-Pacific
- China
- Japan
- South Korea
- India
- ANZ
- ASEAN
- Rest of Asia-Pacific
Latin America
- Brazil
- Mexico
- Argentina
- Colombia
- Rest of Latin America
Middle East & Africa
- Saudi Arabia
- UAE
- South Africa
- Israel
- Egypt
- Rest of MEA
Competitive Landscape
The generative AI in the e-commerce market experiences strong competition, as established market players along with new entrants compete to secure their market share. These players provide a wide range of AI & machine learning solutions, intended to improve the efficiency of e-commerce processes & increase the overall customer experience.
For instance, in May 2023, Otto Group announced a major strategic partnership with robotics firm Covariant. This collaboration is focused on automating Otto's supply chain operations by utilizing Covariant's AI-powered robotic systems, Otto Group gains the capacity to mechanize labor-intensive fulfillment tasks that conventionally depend on manual object manipulation & precise hand-eye coordination. This move is anticipated to significantly grow Otto Group's strategic objective of improving its client services and advancing its digital transformation through the integration of AI-driven technologies.
Some of the prominent players in the Global Generative AI in E-Commerce Market are
- Walmart
- Magento
- Alibaba Group
- Shopify
- Amazon
- Otto Group
- eBay
- Shein
- Groupon
- Zalando
- Other Key Players
COVID-19 Pandemic & Recession: Impact on the Global Generative AI in E-Commerce Market
The COVID-19 pandemic & following recession majorly impacted the global generative AI in the e-commerce market. With lockdowns & social distancing measures, online shopping increased, driving the need for AI-powered personalization & guiding systems to improve the user experience. However, economic uncertainty led businesses to reconsider their investments, temporarily slowing AI adoption. However, the crisis noticed the importance of efficient e-commerce solutions, demanding increased innovation & integration of generative AI technologies to meet changing consumer behaviors. As the economy recovered, the market rebounded & grew, driven by a renewed focus on digital transformation & the imperative to deliver customized online shopping experiences.
Report Details
| Report Characteristics |
| Market Size (2023) |
USD 760.9 Mn |
| Forecast Value (2032) |
USD 2,796.4 Mn |
| CAGR (2023-2032) |
15.6% |
| Historical Data |
2017 - 2022 |
| Forecast Data |
2023 - 2032 |
| Base Year |
2022 |
| Estimate Year |
2023 |
| Report Coverage |
Market Revenue Estimation, Market Dynamics, Competitive Landscape, Growth Factors and etc. |
| Segments Covered |
By Deployment (Cloud, On-Premises and Hybrid), By
Technology (NPL (Natural Language Processing),
Machine Learning, Computer Vision, Augmented
Reality and Speech Recognition), By Application (B2B,
B2C, Personal, Business, Seasonal and Others) |
| Regional Coverage |
North America – The US and Canada; Europe – Germany, The UK, France, Russia, Spain, Italy, Benelux, Nordic, & Rest of Europe; Asia- Pacific– China, Japan, South Korea, India, ANZ, ASEAN, Rest of APAC; Latin America – Brazil, Mexico, Argentina, Colombia, Rest of Latin America; Middle East & Africa – Saudi Arabia, UAE, South Africa, Turkey, Egypt, Israel, & Rest of MEA
|
| Prominent Players |
Walmart, Magento, Alibaba Group, Shopify, Amazon,
Otto Group, eBAy, Shein, Groupon, Zalando, and
Other Key Players |
| Purchase Options |
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