Australian retailers may need to work harder to retain shoppers this Black Friday and Christmas season, with new research revealing that 85% of consumers would consider purchasing from another retailer if artificial intelligence (AI) found the same product at a better price.
The findings, from a survey commissioned by Manhattan Associates, suggest AI shopping assistants could create new challenges for customer loyalty as consumers gain easier access to pricing and product comparisons.
With Australians spending a record $23.8 billion during the extended Black Friday shopping period last year, according to CommBank iQ, retailers are preparing for another highly competitive sales season.
The research found that 83% of Australians expect AI to feature in their shopping activities over the coming months. Comparing products, brands and retailers (36%) and finding the lowest prices or best deals (35%) were the most popular intended uses.
Retailer loyalty faces growing competition
As more consumers turn to AI to research purchases, retailers may find that competitive pricing plays a greater role in attracting shoppers who would otherwise return to familiar stores.
Raghav Sibal, Vice President APAC at Manhattan Associates, said the technology could encourage consumers to explore retailers they had not previously considered.
“AI is giving consumers another way to compare retailers, and that could make it harder for businesses to rely on established customer loyalty. If a shopper can find the same product for less elsewhere, they may be more willing to consider a retailer they haven’t purchased from before,” said Sibal.
“But price is only one part of the purchasing decision. Retailers also need to make sure the product is available, the delivery options are convenient, and the overall experience gives customers confidence to complete their purchase.”
Retailer websites remain central to the shopping journey
Although shoppers are increasingly interested in AI recommendations, the research suggests they still value checking information directly with retailers.
Nearly eight in ten Australians (78%) said they would verify an AI-recommended deal before making a purchase, with 52% most likely to check the accuracy of the price or discount.
Product details and reviews were the next most common concern at 23%, followed by delivery times and costs at 20%.
The research also found that 53% of Australians would prefer to complete purchases through a retailer’s website or app, compared with 35% who would be comfortable buying directly through an AI shopping assistant.
These findings suggest that while AI may influence product discovery, retailers still have an opportunity to secure sales through their own digital channels.
Local stock could help retailers win sales
The survey also highlighted the importance of stock availability and fulfilment when shoppers are comparing retailers.
When asked which factor should influence an AI recommendation where two retailers offered the same product at the same price, 39% selected nearby stock availability, ahead of free delivery (28%) and faster fulfilment (27%).
Three in four Australians (75%) also said they would be willing to share their location with an AI shopping assistant to find products available locally.
For retailers, the findings suggest that having the right products available, alongside convenient delivery and collection options, could help convert AI-driven product discovery into purchases.
“An AI recommendation might bring a customer to a retailer’s website, but the retailer still needs to deliver on what that customer expects. If the price doesn’t match, the product isn’t available or the delivery timeframe isn’t suitable, the customer can easily look elsewhere,” said Sibal.
“During peak shopping periods, retailers need accurate inventory information across their sales channels and flexible fulfilment options to meet changing customer demand. Getting these fundamentals right will be important to converting AI-driven interest into sales, regardless of where a customer begins their shopping journey.”
