How AI is revolutionising festive shopping in India

As India’s vibrant festive season approaches, artificial intelligence (AI) is transforming the shopping experience, making it smarter and more personalised than ever before. Here’s a look at how AI is shaking up festive commerce, featuring insights from major online retailers. 

Personalisation: Tailored for the festive spirit 

The festive season in India is synonymous with unique gifts and stylish attire, and AI is enhancing this experience by offering tailored shopping recommendations. Research indicates that 80% of consumers are more likely to make a purchase when offered personalised experiences. AI technology excels at this by analysing data such as past searches, purchase history, and browsing habits to suggest products that are highly relevant to each shopper. 

Amazon India is a prime example of AI’s impact on personalisation. Its recommendation engine scrutinises your previous interactions to highlight products that align with your interests. If you often search for home décor items, Amazon’s AI might bring festive decorations and lights to the forefront of your search results. This means you can effortlessly Find the perfect items to brighten up your celebrations. Similarly, Myntra, a major fashion retailer, employs AI to enhance its festive  collections. The platform’s AI analyses customer data to recommend outfits and accessories that align with individual tastes. During festive periods, this translates to suggestions for the latest  ethnic wear and trendy jewellery. This kind of personalised approach not only helps shoppers discover new styles but also boosts engagement and sales for the retailer. 

Seamless integration: Shopping without the hassle 

In India’s diverse shopping landscape, where customers switch between online and offline channels, AI plays a critical role in ensuring a seamless experience. Companies that use AI across their platforms often see a 25% increase in revenue due to improved customer satisfaction. Take Flipkart, for instance. The company leverages AI to integrate data across its mobile app and website, ensuring a consistent shopping experience. This means whether you’re browsing on your phone or computer, your shopping cart, wish list, and order history remain synchronised. During the festive rush, this integration helps manage high traffic and ensures that orders are processed  smoothly, leading to timely deliveries. Quick commerce platform Blinkit uses AI to handle the spike  in demand for festive groceries and essentials. By predicting stock needs and optimising  inventory, Blinkit’s AI system ensures that popular items like sweets and snacks are always available. This capability is crucial during peak times, as it helps streamline last-minute shopping and delivers convenience right to your door. 

At Mindshare, a GroupM company and India's media agency, we collaborated with our  creative partners at Hogarth and harnessed AI to craft a cutting-edge strategy that seamlessly integrated the product’s visual appeal with the festive theme. By partnering with a quick commerce platform and utilising AI-driven insights, we optimised product placement and personalised the shopping experience. This strategic fusion not only amplified the product’s visibility but also significantly boosted consumer engagement and interactions, resulting in impressive outcomes and a more dynamic, personalised festive shopping journey. 

Enhancing loyalty: AI’s role in building relationships 

AI is not only about optimising shopping but also about fostering customer loyalty. A significant 75% of consumers expect personalised loyalty rewards and AI-driven programs are stepping up to meet these expectations. Nykaa, a beauty retailer, uses AI to tailor its loyalty rewards. 

The platform’s AI analyses shopping history to offer personalised discounts and exclusive access to new products. During the festive season, this could mean special offers on favourite brands or early access to limited-edition items, making customers feel valued and encouraging repeat purchases. Shoppers Stop also utilises AI to enhance its loyalty program. During festive periods, their AI system identifies customer preferences and shopping habits to deliver targeted promotions. This approach not only boosts engagement but also strengthens customer loyalty by offering rewards that resonate with individual shopping patterns. 

Navigating challenges: Privacy and fairness 

While AI brings numerous benefits, it also raises concerns, particularly around data privacy and algorithmic fairness. With 87% of consumers worried about how their data is used, transparency and compliance with regulations like India’s forthcoming Personal Data Protection bills are crucial. Retailers need to be clear about how they use customer data for personalisation and ensure that data protection measures are in place. Another challenge is bias in AI algorithms. If AI systems are trained on biased data, they can perpetuate existing inequalities. Companies like Reliance Retail are actively working to address these issues by auditing their AI systems and incorporating diverse data sets to ensure fairness and inclusivity. Despite AI’s efficiency, 63% of consumers still prefer human interaction for complex issues. During the festive season, where customer service needs can be particularly sensitive, blending AI with human support is essential. Companies like HDFC Bank combine AI chatbots with human representatives to provide efficient and empathetic service, ensuring that complex or emotional concerns are handled with care. 

Emerging trends: The future of AI in festive shopping 

AI is continually evolving, and several emerging trends are shaping the future of festive shopping. One notable trend is the integration of augmented reality (AR) with AI. For example, Lenskart uses AR technology to allow customers to virtually try on glasses. This feature, powered by AI, helps shoppers find the perfect eyewear without needing to visit a physical store, which is especially useful during busy shopping seasons. Conversational AI is also making waves. Zivame, a lingerie brand, uses AI-powered chatbots to provide personalised assistance and  recommendations. These chatbots help Customers find festive lingerie and offer styling tips, making the shopping experience more interactive and engaging. 

Conclusion 

AI is revolutionising festive shopping in India by making it more personalised, efficient, and engaging. With personalisation driving up to 35% of revenue and seamless integration increasing  sales by 25%, AI’s impact is substantial. However, addressing challenges related to data privacy, algorithmic bias, and maintaining a human touch is vital to ensuring that AI enhances the festive shopping experience rather than detracting from it. 

As Indian retailers continue to embrace AI innovations, balancing technological advancements with  ethical considerations and customer preferences will be key. By doing so, they can offer a festive shopping experience that is not only efficient and personalised but also respectful of cultural traditions and diverse customer needs. Here’s to a season of smart shopping and joyous celebrations! 

This article is penned by Kalyan Undinty, Head of Commerce, Mindshare India.

Disclaimer: The article features the opinion of the author and does not necessarily reflect the stance of the publication.