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Amazon says the power of AI is leading to significant shifts in its business. The tech giant uses AI in everything from customer assistance and summarizing customer reviews to fit recommendations and rewriting product titles on the fly.
Doug Herrington, CEO of Amazon Worldwide Stores, said AI is among the biggest technological revolutions.
“AI is becoming transformative for our business, and we really haven’t had a technology revolution as large as this since the start of the internet,” Herrington said during his keynote session at NRF on Sunday. “We had some big ones roll through. I think the shift to mobile was very large, the rise of the social platforms was quite large, but nothing as large or as extensible as this.”
Herrington said multiple teams within Amazon are figuring out ways to use AI: “They might be rebuilding a feature or a product that we already have but making it cheaper or better, or they’re inventing some totally new experience that felt like science fiction like two years ago.”
Rufus, Amazon’s conversational shopping assistant, can now answer up to half a million questions that Amazon wouldn’t have been able to answer before in the search box, Herrington pointed out. “Things like: ‘Just tell me about protein powder’ or ‘Can I use this fishing reel in salt water’? It's really opened up a whole new level of customer convenience.” Amazon released Rufus powered by Generative AI in February 2024.
Herrington said about half of Amazon’s customer service interactions are powered by Generative AI in some form or another, and it’s delivering higher quality responses with higher customer satisfaction.
“It’s just everywhere right now,” he said. “It’s improving our robotics…it’s helping manage traffic with our big fleets and mobile robots.”
According to Herrington, Amazon’s investments in AI have revealed significant unforeseen opportunities, potentially leading to innovative new retail store concepts and formats.
“I think it’s a prudent bet that we’re making,” he said. “I’m really excited to see how it’s going to change. It’s going to touch all of us, all of our businesses. It’s going to lower costs, going to improve quality, it’s going to help us develop new customer experiences, and it may even spawn new retail formats.”