Conversational AI in retail: Use cases and benefits in 2026

The bar has never been higher for service in retail. Customers want fast, personalized responses to their questions and concerns — no matter where they reach out. In fact, 90 percent of consumers consider immediate responses to customer service questions important or very important, and 82 percent feel the same about sales or marketing questions.

To achieve this mix of speed and personalization, your retail business needs more than just a standard chatbot. While helpful in their own way, chatbots don’t have the same capabilities as technology like conversational artificial intelligence (AI).

AI chatbots for the retail industry can help your business scale with its current staffing resources. This allows you to provide top-notch service without increasing your costs.

In many ways, conversational AI for customer experience in retail is no longer optional — it’s an essential tool for staying competitive in today’s customer-first e-commerce environment. But what is conversational AI in retail, and how can you use it to your advantage? Read on to learn how you can change the way you approach retail with this revolutionary technology.

What is conversational AI in retail?

Conversational AI in retail facilitates natural communication between customers and your brand through chat, voice, and messaging. This is often seen through tools such as AI chatbots, agents, SMS systems, or voice assistants.

When comparing a rule-based chatbot vs conversational AI, conversational AI has several advantages. These solutions use advanced technologies like natural language processing (NLP) and machine learning to identify context, analyze customer intent, and respond to user issues and questions in a human-like way. Meanwhile, traditional chatbots are limited to rule-based workflows, which can come across as robotic or unhelpful.

The adaptability and intelligence of conversational AI enable your team to tap into benefits that drive sales, optimize operations, and improve the customer experience.

Benefits of conversational AI in retail

Thanks to the versatility of conversational AI in e-commerce, your team can change the way your organization does business and assists customers. Using this automated technology enables you to tap into the conversational AI benefits in retail that can produce measurable business results. These include

• Lower operational costs: By using conversational AI for customer service requests, your team can handle the more complex requests that require a human touch. This allows you to address a high volume of issues while reducing your overall operational expenses.
• Higher sales and conversion rates: Virtual assistants in retail can serve as an extension of your sales team, providing customers with personalized product recommendations. These suggestions increase a customer’s likelihood of purchasing.
• Faster customer service: Conversational AI in e-commerce can instantly respond to customer inquiries with personalized outputs. This speed improves customer satisfaction, experience, and retention.
• Increased team productivity: Since AI chatbots for the retail industry can handle simple tasks, your team can dedicate more time to high-value interactions or other jobs. This increased productivity enhances your team’s overall value and allows employees to feel that they’re doing meaningful work.
• Stronger customer engagement: Common conversational AI retail use cases center around proactive engagement. These tools can be used to push offers, recommendations, and other relevant content to customers, keeping your brand top of mind.

You can access diverse benefits of conversational AI through a wide range of uses, but how exactly you decide to apply this technology to your business can vary.

Top use cases of conversational AI in retail

Conversational AI in e-commerce can be used in several ways to improve your processes. Check out these conversational AI examples in retail to better understand how this technology can address each use case and drive value for your business.

Product discovery and recommendation

Just as in a brick-and-mortar retail store, customers shopping online may need assistance finding products that suit their preferences. In-store, sales representatives could provide recommendations and drive conversions. But with the sheer volume of online shoppers, it would be impossible to provide this same service in a digital environment.

Conversational AI can act as an extension of your sales team, providing product recommendations that drive sales at scale. Picture this: A returning customer logs in to your website and begins shopping. AI virtual assistants in retail can not only pull historical data from previous purchases but also analyze current session data. Based on this information, your AI sales representative will offer up new products, bundles, or deals that may intrigue your customer — increasing their likelihood of conversion and overall cart value.

Customer segmentation

Not every customer will be receptive to the same messaging, offers, or products. Therefore, your team needs to segment them into marketing and sales campaign groups. While many businesses still rely on demographics for segmentation, this process becomes more effective when you introduce conversational AI into the mix.

Using AI chatbots for retail industry data analysis, you can quickly get insights from customer information to create accurate segments for your marketing or sales efforts that continuously update over time. These strategic assets can inform key business decisions about advertising, helping you maximize your ROI when it comes to outreach.

You can combine multiple conversational AI retail use cases by using this segmentation to inform your chatbot’s personalized recommendations. This approach allows you to create the most effective and enjoyable customer experience possible.

Enhanced customer support

One of the top conversational AI examples in retail is using chatbots to enhance your brand’s customer support experience. Expectations today revolve around speed, and conversational AI can provide the instant, personalized support that modern shoppers seek.

AI chatbots can act as self-service assistants for customers in need of answers, resolutions, or recommendations. By training these AI tools on your internal data, conversational AI can provide customers with accurate, helpful information — fast.

Compared to traditional chatbots, AI tools can also go beyond canned responses to provide a more human experience for users. And if your conversational AI doesn’t know how to handle specific situations, it can smoothly hand off customers to live agents.

For example, if a customer needs assistance returning an order, conversational AI can pull historical and internal data to help. However, if a more complex issue arises, conversational AI will connect this customer to a live agent trained to handle these situations — reducing self-service frustration while still providing rapid response times.

Post-sale nurturing and engagement

Retail relationships don’t end once the sale is over. Conversational AI helps you stay connected with your customers beyond checkout, creating a continuous cycle of engagement and nurture content that doesn’t require your team’s input.

By automating the post-sale relationship, your conversational AI tools can keep customers up to date on the latest deals, releases, and events to generate future business. For example, your strategy could include an automated SMS campaign that uses conversational AI to send relevant deals to specific customer segments.

Employee enablement and empowerment

Conversational AI in retail takes mundane, repetitive tasks off your team’s plates. In fact, one of the best uses of conversational AI in retail is as a virtual assistant for your team. 

With virtual assistants in retail, your team can quickly access essential customer data to enhance their service efforts. Say a customer calls about a recurring issue — a customer service agent can use conversational AI to retrieve past conversations with the customer.

Internally, your team can use conversational AI to compile and analyze data. Whether it be measuring customer satisfaction, analyzing employee performance, or identifying trends, conversational AI in retail is a key player in boosting your team’s capabilities.

With these conversational AI retail use cases, your tool goes beyond providing financial benefits to your business. It also creates an improved, hyper-personalized customer experience that can increase satisfaction and loyalty.

Once you’ve decided which of these conversational AI retail use cases is most relevant to your business needs, you’ll need to learn how to implement the tools themselves.

How to get started with conversational AI in retail

Before you can tackle AI-driven conversational commerce in retail, you’ll need to take a few strategic steps to ensure your success and optimize your use of these tools — as well as the results that follow.

1. Define clear goals: What outcomes are you looking to achieve through conversational AI in e-commerce? Create clear goals and benchmarks for success, whether you’re looking to drive sales growth, customer retention, service efficiency, or another key metric.
2. Choose what to automate: Dial in on what would be most beneficial to automate. Typically, repetitive or low-empathy tasks — such as order tracking and answering frequently asked questions — are easy places for conversational AI to add value.
3. Select the right tools: Investing in the right solution will make all the difference to your retail performance. Carefully evaluate conversational AI in e-commerce tools for usability, scalability, and compliance to find the right solution for your needs.
4. Integrate with your tech stack: Your conversational AI platforms must be compatible with your team’s other digital tools. If they aren’t, it can lead to more work and errors in the long term through manual data entry. Check an AI solution for integrations with tools like your customer relationship management system, e-commerce platform, and messaging apps before you make your final decision.
5. Collect data and optimize: Although launching your conversational AI tools may seem like the final step in the implementation process, you need to continuously monitor and train the tools to refine interactions and improve their usefulness.

Using these steps, you can more effectively implement and optimize your conversational AI. Since these tools have shifted from a want to a need, these tips can help you keep pace with the competition.

Why retailers need to use conversational AI

Conversational AI is becoming critical to the digital retail space. Recent reports have shown that 90 percent of retailers are now adopting or piloting AI in some capacity. Those who aren’t are at risk of being left behind. 

But this isn’t the only reason why conversational AI in retail is worth your investment. Consider these factors when evaluating whether implementing this technology is the next best move for your business:

• Advancing technologies: AI is advancing rapidly thanks to NLP and large language models. As these tools evolve, they’ll be able to support more use cases in retail and deliver further benefits for your organization.
• Early adopter advantage: Companies that are already leveraging this technology are producing results through personalization at scale. This competitive advantage can make all the difference to customers choosing between your brand and a similar product. Early adopters also benefit from being more comfortable with AI technology as a whole, making it easier for them to implement more advanced solutions down the line.
• End-to-end automation potential: Soon, conversational AI in retail will be more than just a single-function solution — it’ll eventually be able to automate the entire retail process, from marketing to fulfillment.

Taking advantage of these capabilities and future trends can place your company at the front of the pack when competing for online shoppers. And Jotform AI Agents make it easier than ever to get started.

Supercharge your retail processes with Jotform AI Agents

Implementing conversational AI in e-commerce is easy with user-friendly solutions like Jotform AI Agents. These AI agents make retail chatbot personalization achievable without code — enabling your business to deliver individualized customer experiences in minutes.

Jotform AI Agents can be used to answer frequently asked questions, guide shoppers to the right products, or streamline internal processes that are holding up your team. They fit into any part of your retail operations, making them ideal for supporting or onboarding customers, giving them product information, or collecting their data.

Creating your own Jotform AI Agent takes just a few quick steps:

1. Choose an AI agent building method: From scratch, a form, a template, or a clone.
2. Train your agent using internal and external data from documents, questions and answers, hands-on training, or URLs.
3. Customize your agent experience using the drag-and-drop Agent Builder, taking your retail chatbot’s personalization to the next level.

While you can easily customize your AI agent from scratch, you can also generate ready-made agents using one of the thousands of AI agent templates available for free through Jotform — including specific retail AI agent templates.

These virtual assistants in retail are perfect for businesses looking to provide high-volume customer service without hiring additional staff. Jotform AI Agents reduce the burden on your teams by providing support through instant order updates, product recommendations, or collecting post-purchase feedback. 

Elevate your retail experience with conversational AI

If your team is looking to automate engagement and improve customer experience, implementing conversational AI is the next step in your business journey. These tools deliver real results for retail businesses that use them effectively, including faster service, higher sales, and stronger loyalty.

But staying ahead of the curve requires action, so don’t wait. Try adding conversational AI solutions like Jotform AI Agents to your business strategy today to take advantage of this revolutionary technology and the possibilities it presents.