Different generations have varying shopping habits with changing retail trends only adding to the contrasts in how consumers discover, research, and purchase products. At the heart of evolving trends is arguably AI technology, impacting the traditional ways consumers shop.

According to new research from SAP Engagement Cloud, Gen Z shoppers are unsurprisingly adopting AI in their retail journeys but they expect brands to use the technology responsibly and transparently. The survey of 2,000 UK consumers discovered that poor use of AI could persuade Gen Z consumers to switch to another brand, highlighting a disconnect between their willingness to adopt AI and their willingness to tolerate poor implementation.

Young shoppers embrace AI but remain cautious about its use

In all, 48% of Gen Z respondents said they had purchased a product recommended by AI and 37% expressed they would be willing to trust AI assistants in making purchases on their behalf. However, 43% reported that they had moved to other brands due to particular AI use. 

Sara Richter, chief marketing officer at SAP Engagement Cloud, commented on the findings, saying, “Gen Z isn’t rejecting AI. They’re embracing it faster than any other generation and increasingly allowing it to influence what they buy. The surprise is that greater adoption does not translate into greater tolerance.”

AI in retail is moving from marketing trials into an integrated part of the buying process. SAP Engagement Cloud’s figures reveal how automated assistants and AI-generated recommendations are influencing more shoppers, with 23% saying they regularly trust AI assistants and tools to help them make purchasing decisions. 26% have purchased AI recommended goods, while 23% confirmed they would be comfortable in allowing AI assistants to actually buy products and services for them. 

Transparency remains key

The data emphasises how younger consumers are the most active AI users throughout the purchasing process. They also show the least tolerance for brands that may use AI in unclear or intrusive ways. Although there is an appetite for digital tools, brands should not expect consumers to show loyalty based on this. 

Despite a willingness to rely on AI when shopping, Gen Z remains cautious. 37% said they would prefer human support during complications, while 32% said data privacy and security were important. A further 29% sought greater transparency over AI-driven decision-making.

Undisclosed or non-transparent AI use would cause around 25% of Gen Z respondents to lose loyalty in brands, which suggests consumers want greater visibility over when and how AI is influencing their shopping experiences.

Sara Richter added, “Gen Z is willing to trust AI with recommendations and even purchasing decisions, but they expect brands to be transparent about how it is used. Brands that fail to earn that trust risk losing customers just as quickly as they gain them.”

AI and personalisation could strengthen brand loyalty

The research also points towards AI and personalisation creating opportunities for brands to boost customer relationships, particularly amongst Gen Z shoppers. 15% of Gen Z respondents said they were more loyal to brands if AI helped improve their shopping experience. 21% also said that personalised marketing strengthens their loyalty to brands. 

For marketers, this shows that AI does not simply present a risk to customer relationships. When used appropriately, personalisation can give brands more opportunities to make shopping experiences relevant and useful. 

AI rivalling traditional sources of influence 

Almost a quarter of respondents revealed they are more likely to use AI recommendations than advice from friends and family, indicating changing influences within retail. Word of mouth has long been a key influence shaping purchasing decisions but AI tools are now providing a similar role with product rankings and tailored suggestions, filtered for individual consumers. 

This creates a new challenge for brands attempting to understand how purchasing decisions are being influenced. Retailers have invested heavily in AI to improve personalisation, automate customer service, and deliver more relevant recommendations, with the aim of increasing conversions and retention. As AI takes on a greater role in discovery and decision-making, understanding how consumers interact with these systems will become increasingly important.

Commenting on the survey, Mark Ritson, founder of MiniMBA and a former marketing professor noted, “There’s a tendency to assume that because Gen Z loves technology, they’ll tolerate anything brands do with it. The data suggests the opposite. They’re embracing AI rapidly, but they’re also proving to be the least forgiving when brands get it wrong.”

Gen Z shopping habits prove difficult to pin down

The findings highlight a wider challenge for marketers – understanding what drives Gen Z’s decisions cannot always be reduced to a set of statistics. This may be down to the fact that many researchers often interpret them based on their own experiences, creating filtered assumptions and a distorted picture.

The problem isn’t that marketers don’t have enough data on Gen Z; it’s that there is often a lack of insight into the reasons and experiences behind the data. The findings around AI show why this context matters. Gen Z may be comfortable using AI during their shopping journey but the points at which trust and transparency become concerns are harder to capture through metrics alone. Only through real-time observation can researchers get a clearer view of what is driving these decisions. 

Gen Z consumer characteristics 

Understanding these behaviours requires recognising some of the characteristics that shape Gen Z’s approach to shopping. Gen Z are often considered “digital natives” having grown up in a world that has almost always had internet access. Furthermore, Gen Zers tend to be more socially conscious than older generations, meaning they may place greater importance on how brands use technology and communicate their values. 

Older members of this generation are also regarded as financially conscious, thinking carefully before making purchases. Therefore, using AI to support product discovery, and inform purchasing decisions has become increasingly appealing to Gen Z shoppers who are trying to keep to certain budgets.  

Three characteristics play significant roles in defining Gen Z consumers, from their familiarity with digital technology to their expectations around transparency and value. Recognising these characteristics can help marketers provide a clearer understanding of how this generation approaches brands, technology, and purchasing decisions. 

As brands navigate a move towards AI-led customer journeys, understanding opportunities and the expectations of consumers will be key to discussions at upcoming DMWF events where experts will discuss the themes that are impacting the marketing world. 

See also: B2B firms prioritising short-term sales over brand building – Marketing Tech News 

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