“AI e-commerce” may become a new hope for major e-commerce platforms

In China, in the face of competitive pressure from Pinduoduo, Alibaba has high hopes for AI e-commerce and regards it as a “winning weapon” to deal with Pinduoduo and Tiktok e-commerce. In foreign countries, in order to cope with the fierce competition from Temu, TikTok and SHEIN, Amazon has taken the initiative to reduce the commission of the clothing category, and vigorously develop AI technology, which is regarded as the key to maintain its leading position.

In April 2023, Amazon CEO Andy Jassy revealed in a shareholder letter that Amazon is investing heavily in large-scale language models and generative AI, which it sees as the core of business innovation in the coming decades to enhance the user experience. This shows that Amazon is not only satisfied with the existing “search e-commerce” model, but also actively innovate itself, intending to completely change the platform ecological pattern. To this end, Amazon has made a key move to use AI tools as a new traffic entry point, which will significantly reduce the traffic to product pages through “keyword search.”

For sellers, this change means a huge shift in the traditional “search e-commerce” operating logic. If sellers do not adjust their strategies in time, including adapting to AI traffic entry in terms of product titles, A+ content, descriptions, etc., they will face the risk of a sharp decline in traffic and increased competitive pressure.

Amazon is making major changes at the entrance level, using AI technology to transform a number of products, including intelligent voice assistants, image search, etc., and introducing three major AI features: AI review integration function, AI fit function, and AI link writing function. Especially in the field of buyer reviews, Amazon’s AI technology has been deeply tested and applied.

Recently, Amazon launched an AI tool called Rufus, which is similar to Chat GPT in the e-commerce scene, and uses generative AI technology to help customers choose products through “questions and answers”. Rufus has a prominent entry position inside the search box at the top of the Amazon shopping App. Buyers can ask a variety of questions through Rufus, which will quickly integrate information and provide detailed answers and recommendations. Rufus is also an independent judge, able to analyze and advise buyers when they ask unrealistic questions.

Rufus’s Q&A shopping scenario will likely completely change the ecological landscape of Amazon and subvert the traditional operation logic of search e-commerce. It became a new entry point for traffic, allowing users to “discover” products or get specific shopping suggestions through Rufus, in addition to searching for products through the search box. As users experience the convenience of Rufus, their shopping habits will gradually change.

This change brings new opportunities and challenges for sellers. On the one hand, users can ask more complex and segmented questions through Rufus, giving sellers the opportunity to segment their products. Sellers, on the other hand, will need to re-plan their traffic layout around Rufus to accommodate new AI content queries and recommendation displays.

In order to get more traffic and orders in Rufus’s Q&A shopping scenario, sellers need to make traffic layout from the following aspects: First, pay attention to the setting of Amazon category nodes, and try to set multi-category nodes to increase the chance of being included; Second, guide customers to write useful reviews to increase the likelihood of being included in Rufus; In addition, answer customer questions about the tonality of Rufus to increase the probability of being recommended; Finally, brand and product information is laid out inside and outside the site to provide Rufus with a rich source of data. Through these strategic adjustments, sellers can better adapt to Amazon’s ecological changes and seize the opportunities brought by new traffic portals.