AI will be “game-changing” for how retailers interact with their customers, claimed Ocado e-commerce director Siobhan Bowie, as the pureplay supermarket ramps up its use of AI across its operations.
Following a major upgrade of its core tech stack last year, the retailer has rolled out a suite of new AI capabilities aimed at enhancing customer experience on its website, improving availability and cutting waste, as well as improving how it targets new customers.
It includes a new agentic AI chatbot to handle customer queries on its website. So far, the feature is only available to around 10% of Ocado users as part of a trial, but will be rolled out further in the coming weeks, Bowie told The Grocer.
The bot would free up Ocado’s human customer hub team to deal with customers who need a greater level of support, Bowie said.
Ocado was once again the UK’s fastest-growing grocer in the four weeks to 25 January according to Worldpanel, formerly Kantar. A significant driver of the growth had been its use of data and AI to more effectively target new and potential customers, as well as retain them, Bowie said.
In July the retailer completed a five-year project to transition its entire operation to a new tech platform, which had improved its capabilities and ability to launch new features.
Following the upgrade, Ocado is now exploring how it could use AI to improve how customers search for new products on the website as well as speed up the checkout process, Bowie said. However, it currently has no confirmed plans as to how this will be done.
“At the moment, everything has to be product-led search,” Bowie said. “How do we get to a place where you’re like ‘I want a fancy meal for five people tonight. Show me what that could look like and put those items straight in my basket’?”
AI is reshaping the grocery shelves
Ocado is the latest grocer to confirm plans to significantly step up its use of AI across its network, as retailers look for ways to improve their supply chains, cut costs and make stores more efficient.
While the closure of all Amazon Fresh stores last year put an end to the concept of a fully AI-powered shop, that allows shoppers to walk in and out without the need for human interaction, AI has proved much more effective as a tool to monitor and improve availability.
Sainsbury’s has been embedding AI into its Blue Yonder forecasting tool to improve its sourcing supply chain. Meanwhile, Morrisons has experienced significant improvements in its in-store availability after a widescale rollout of Focal System’s AI-powered shelf-edge cameras to monitor availability.
Tesco is using AI at the heart of an overhaul of its Clubcard offers, as part of a new three-year partnership with French large language model specialist Mistral AI announced in December. In October Tesco’s media arm launched a new creative studio that uses generative AI to create compliant ad campaigns for brands.
“It’s game-changing for this industry,” Bowie said, when asked what the potential of AI could mean for grocery shoppers.
“It won’t happen overnight, but the fashion industry seems to be moving faster because of some of the tools that enable you to do the one-product checkout off-platform, whereas multi-product checkout doesn’t exist yet [in grocery]. But it’s not going to be long,” she said, during an interview to celebrate Ocado’s recent win in the Online Grocer 33.
Ocado’s operating loss fell from £48.5m to £27.5m despite a £48.1m jump in finance costs it revealed in full year results published this week. Ocado also confirmed plans to cut 5% of its global workforce up to 1,000 roles, in a restructure of its Ocado Solutions and Ocado Intelligent Automation division.
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