(Reuters) - Artificial intelligence-powered chatbots helped consumers purchase and return products during the 2024 holiday season, boosting online sales in the United States by nearly 4% year-over-year, according to a report by Salesforce (NYSE:CRM).
Retailers turned to nifty conversational customer services - or chatbots - among others such as targeted promotions, product recommendations and loyalty programs, to influence customers hunting for trending products and best bargains.
Online sales rose to $282 billion in the United States between Nov. 1 and Dec. 31 from $272 billion a year ago, ahead of Salesforce's forecast of 2% growth, even as discounts were tempered.
Shoppers used AI-based chatbot services 42% more than a year ago, according to Salesforce, which analyzed data from 1.6 trillion page views on its platform.
AI influenced-sales rose to $229 billion of global online sales between Nov. 1 and Dec. 31 from $199 billion in 2023, the report said.
However, a high rate of product returns by customers at 28%, compared with 20% in 2023 was a "significant concern" and could reduce the overall profit margins for retailers, said Caila Schwartz, director of Consumer Insights at Salesforce.
"Retailers who have embraced AI and agents are already seeing the benefits, but these tools will be even more critical in the new year as retailers aim to minimize revenue losses on returns and re-engage with shoppers," Schwartz added.
Orders placed through smartphones peaked on Christmas day, as customers set out to do some last-minute shopping, with about 79% of all orders being placed through mobile devices during the holiday season, the report said.
Apart from AI, retailers used social media sites such as TikTok Shop and Instagram to help generate interest, with social media driving 14% of all traffic to e-commerce sites.