Much like the world wide web in the early 2000s, generative AI seems like it’s in a “wild west” phase—as businesses and consumers explore the true potential of the new tech, there are plenty of warnings and red flags being thrown, yet a notable lack of regulatory oversight when it comes to establishing safeguards and protocols to protect users on both ends. But this is starting to change—the FTC is exercising some oversight by investigating ChatGPT developer OpenAI over consumer protection law violations, and new research from business solutions firm Capterra indicates that consumers are just as concerned, and are demanding more regulation.
As AI-driven shopping tools such as ChatGPT search plugins and AI personal stylists aim to revolutionize eCommerce by replicating the intuitiveness of human salespeople, the firm’s newly released 2023 Retail AI Security Risks survey of 1,000 online shoppers reveals that two-thirds (65 percent) of respondents don’t think AI tools are handling personal data responsibly.
There’s little doubt that generative AI can help growing retailers compete with big brands. But there’s a major roadblock: As businesses using AI haven’t yet been reeled in by any significant regulatory insight, there is no established sense of trust—and consumers rightly fear how such tools will handle the data they share in exchange for personalized online shopping experiences.
Notably, only 35 percent of online shoppers trust AI tools to manage their data responsibly
Compared to last year, 64 percent of online shoppers are more wary of AI, and a resounding 86 percent believe AI should face stiffer regulation. Furthermore, while most shoppers are willing to share product reviews and style preferences with an AI tool, few would share the kind of sensitive data that leads to truly personalized AI-driven shopping: biometric data, images of themselves, and payment information.
As demand for AI regulation grows, a potential bridge between AI acceptance and user trust likely lies in more human oversight, known as human-in-the-loop AI. A substantial 60 percent of surveyed shoppers expressed greater confidence in AI tools when human intervention is involved.
“Unlike human salespeople, AI can draw from vast data sets, ensuring a more comprehensive and personalized shopping experience,” said Molly Burke, senior retail analyst at Capterra, in a news release. “For growing retailers, AI adoption means a potential surge in sales conversions, deeper insights into customer preferences, and the ability to scale customer interactions without significant overhead.”
When used responsibly, AI is unquestionably a powerful ally for growing businesses
In fact, 58 percent of online shoppers are interested in shopping online using an AI tool to help personalize their experience. And nearly half (45 percent) of those surveyed even say they’re willing to share personal information with AI in exchange for curated product suggestions, despite widespread concerns about data safety.
Becoming an early adopter of generative AI will help small retailers, though they’ll have to pay attention to consumer demands for more oversight. Retailers looking to integrate AI must prioritize transparency, data protection, and customer support.