Retailers want ChatGPT buyers but balk at sharing customer data with OpenAI

Consumers increasingly turn to OpenAI's ChatGPT and Google Gemini for product recommendations, prompting retailers like Walmart, Ulta Beauty, and Wayfair to update their websites to boost presence in chatbot search results. However, these retailers intend to keep the checkout process on their own sites to collect data on browsing habits, cart sizes, and past purchases, which helps drive future sales and customer loyalty. Analysts predict that revenue from AI-referred customers will reach $8 billion this year. In June, 41% of U.S. consumers used generative AI for online shopping, and visitors attracted via AI services generated 41% more revenue per visit than those from other sources. Unlike traditional search engines that rank by keywords and links, chatbots answer questions contextually, forcing retailers to rewrite product descriptions and rethink how customers discover brands. Ulta Beauty reported that customers from Gemini and ChatGPT showed doubled conversion rates and intent, and the company collaborates with Google to integrate shopping carts and loyalty programs into Gemini's shopping system, but it wants to keep the ordering process on its own site. Retailers maintain an edge over AI platforms because they know much more about their customers and products. Amazon Web Services advises its retail clients to use AI services for promotion but keep their seller sites as the 'best place to shop.' Similarly, wedding planning platform The Knot optimized its site to increase partner presence in ChatGPT search results while encouraging couples to book venues directly. In March, OpenAI discontinued Instant Checkout feature in ChatGPT, now simply helping users find products and directing them to online stores and marketplace sites.