The Pros and Cons of Using ChatGPT in Retail
Since November 2022, ChatGPT has taken the world by storm, revolutionizing how artificial intelligence (AI) interacts with our daily lives. Having an AI tool that is accessible to the masses has also altered the future of many businesses, and the retail industry is no exception.

Could ChatGPT help us improve the customer journey? How are retailers already using AI like ChatGPT? And at what cost? Come along with us as we discuss what we know so far. But first, let’s cover the basics.

What is ChatGPT?

For those unfamiliar with the platform, ChatGPT is an AI program that has been available to the general public for a little over six months. Released November 30, 2022, ChatGPT is a sister product to InstructGPT and is built to take user prompts (e.g., “What book would you recommend I read next if I like Colleen Hoover books?” or “What should I do if my dog is panting loudly?”) and respond with coded modeling that pulls from feedback and instruction. ChatGPT then takes these inputs, learns from them, and improves its answers over time.

Despite its short lifespan, ChatGPT has seen enormous success; recent numbers show that ChatGPT has 100 million active users who provide up to 10 million queries per day.

How is ChatGPT Used in Retail?

While the full extent of ChatGPT’s capabilities remain to be seen, the biggest opportunity for retailers is its ability to help us fine-tune and automate customer service offerings, detect fraud, and predict customer behaviors.

And it is critical to try embracing the advantages ChatGPT offers, because AI is not going away anytime soon. Consider when social media was first introduced back in the early 2000’s. There was similar concern and confusion about how businesses could (or should) use the new tool for their needs. In fact, many rebelled against it because they thought it wasn’t necessary. Despite that, social media forms a core part of a business’s marketing strategy, especially in retail.

Accordingly, it’s vital that retailers consider how to embed ChatGPT and AI tools now to avoid falling behind the competitors who are becoming early adopters. So, instead of denying the inevitable, let’s take a closer look at the pros and cons of using ChatGPT in your retail business to learn where the opportunities lie.

Pros of Using ChatGPT in Retail

Consider what ChatGPT can do to benefit your retail business:

Predict Customer Behavior to Improve the Retail Buying Experience

When ChatGPT has access to purchase history, browsing behavior, and other user information, it has the ability to accurately personalize product recommendations at the drop of a hat. The platform can also hold real-time conversations with customers and suggest products that meet their unique needs in the moment.

For example, imagine you’re an outdoor retailer and a customer has purchased a kayak from your store. ChatGPT can now offer kayak-related recommendations such as paddles, dry bags, personal floatation devices, spray skirts, and other useful products, extending the potential lifetime value of that customer. Over time, ChatGPT will further refine its suggestions based on what it learns about the customer’s preferences for colors, sizes, pricing, and more. By offering AI solutions that cater to customer preferences, you can demonstrate your value and front the products that they are most likely to want.

Deter Customer Frustration Amid Workforce Shortages

As businesses continue to face workforce shortages, ChatGPT offers unique solutions that help ensure retailers maintain a seamless shopping experience while also preventing customers from feeling neglected or frustrated by lack of staffing. ChatGPT can be deployed to handle inquiries, provide ongoing customer support, suggest specific products that fit a customer profile, and process orders as they come in.

Additionally, for workers on the clock, ChatGPT offers continuous support by providing information, guidance, and suggestive tools to power their selling capabilities and act as a personal shopper on behalf of the customer. In this vein, ChatGPT can assist employees with complex customer inquiries, provide suggestions for issue resolution, and offer relevant product knowledge to bridge the gap for their customers, ultimately improving the experience for the end user. Win, win.

Cater to the Mindset of Today’s Workforce and Customer-base

We live in a technology-driven world, plain and simple. As you look to attract new customers and workers in tandem, offering the latest and greatest technology shows that you’re doing everything in your power to keep up with competitors and drive a good experience for everyone who walks through your doors or visits your website.

Help with Fraud Detection

From real-time monitoring and analysis of customer behaviors, to reviewing purchasing patterns, assigning customer fraud risk scores for user profiles, and more, ChatGPT is a helpful addition to your security repertoire (though it certainly shouldn’t be your sole fraud detection tool). As an example, if a fraudulent customer often visits a wireless store to purchase phones and resell them, ChatGPT can use the customer’s existing profile to identify them as a fraud risk. While it isn’t the be all, end all for fraud protection, it does add another layer to further secure your business.

Complement Your Existing Omnichannel Retail Strategy

Given that 85% of today’s shoppers start purchases on one device and finalize the sale elsewhere, it’s important to think about your omnichannel retail strategy from every angle. ChatGPT technology can be used to function within your existing strategy – both online and in person – with the use of interactive displays, point of sale systems, social media sharing, and much more. How does this work? Well, ChatGPT can be integrated into self-service kiosks or online platforms, allowing customers to find the information they’re looking for independently while the retailer still provides a high-touch, interactive experience. In turn, this will help drive customer retention and loyalty because of the positive, personalized experience it fosters.

Cons of Using ChatGPT in Retail

When implementing a new tool like ChatGPT, it’s also important to consider its potential pitfalls, such as:


As with many technologies, the lack of trust people feel when entering their personal information into a platform can be troublesome. Couple this with the uptick in data breaches over the past few years, and it’s completely understandable why customers may feel reluctant in sharing their information when purchasing something. Customers may perceive ChatGPT as intrusive to their personal information because it collects data over time, monitors their purchasing behavior, and makes unsolicited recommendations based on the information it has.

To counteract this issue, retailers must ensure proper safeguards and compliance with data protection regulations to protect customer information and build trust. They can do this by garnering customer consent to use the tool, offering human-focused alternatives, and providing opt-out options if they’d prefer not to participate, both on and offline.

Lack of Emotional Intelligence

Last, but certainly not least, ChatGPT is not a complete substitute for human intelligence and emotion. When entering a retail environment, many customers may still want to talk to a real person with whom they can discuss their unique needs. That’s why it’s so important to consider how ChatGPT can be used to enhance your existing worker experience. ChatGPT offers the capability to predict potential opportunities that will better serve your customer base — and that should be the focus above all. While we anticipate the capabilities of AI to grow and expand, we are certain it will never replace the need for human interaction and emotional capability.

Are You Ready to Introduce ChatGPT Into Your Retail Business Processes?

Despite a few potential cons, using ChatGPT for retail provides a great opportunity for your brand. With that said, AI is a new field in retail. If you need support in building out a stronger, more technologically-sound omnichannel retail strategy that incorporates ChatGPT or other AI features, the team at Experience MINT has the experience to help you get started.

Get in touch to learn how we can support you.

June 27, 2023