How generative behavioral AI transformed e-commerce in 2024

Online shopping soared to new heights in 2024, with 2.71 billion people (33% of the global population) purchasing products and services online. This figure is expected to rise to 2.77 billion by 2025, reflecting the colossal growth of the e-commerce sector.

But with rapid growth comes intense competition, forcing retailers to find new ways to stand out in a crowded marketplace.

Against this backdrop, generative behavioral AI has emerged as a key solution, helping businesses adapt to shifting expectations and deliver bespoke shopping experiences. By 2027, an estimated 95% of retailers are expected to have tested or invested in generative AI, recognizing its potential to elevate customer engagement.

With this in mind, let’s explore the top 10 AI-driven trends that defined e-commerce in 2024:

1. Hyper-personalization becomes non-negotiable

In 2024, unique shopping experiences weren't just a nice touch - they became a must-have. As customer expectations for tailored interactions skyrocketed, advanced technologies like generative behavioral AI became instrumental in meeting this demand. Today, 71% of customers expect businesses to provide personalized engagement, emphasizing the increasing importance of bespoke shopping journeys.

Platforms like Quin AI enabled brands to analyze subtle behavioral cues, gaining deeper insights into their visitors. Armed with this understanding, more businesses were able to deliver highly relevant product recommendations and tailored experiences that hit the mark.

A prime example of this is Kingfisher’s success with Quin AI. By integrating AI-driven recommendations, Kingfisher turned aimless browsing into focused, satisfying shopping journeys. The result? A remarkable 2.7x increase in conversions.

2. The rise of real-time behavior-based engagement

This year, generative behavioral AI changed how e-commerce businesses connect with customers, using real-time behavior prediction to create more effective and personalized interactions.

Rather than relying on reactive strategies like follow-up emails sent hours after a user abandoned their cart, online retailers started using AI to monitor live session data. This allowed them to identify key moments when customers might hesitate or lose interest and respond instantly, re-engaging them with timely, relevant actions to keep shopping journeys on track.

Take M&S, for example. Using Quin AI's real-time behavior prediction, M&S was able to better understand its customers and provide incentives at the right moments to keep them engaged. This quick, targeted approach boosted conversions by 1.3x, turning moments of hesitation into completed purchases.

3. AI-driven solutions for price sensitivity

With economic uncertainty weighing on shoppers, price sensitivity became a critical focus for brands in 2024. Despite stabilizing inflation rates, 53% of respondents in a recent survey still cite rising prices as a major concern.

In response, more companies implemented contextual pricing strategies to adapt to these shifting customer needs. For example, Calvin Klein used generative AI to pinpoint price-sensitive shoppers and highlight their flexible payment options through Klarna, ensuring a more accessible shopping experience.

This targeted strategy eased customer hesitation, resulting in a 1.8x increase in conversions. It’s a powerful example of how generative AI can build customer confidence, drive sales, and protect profitability – even during periods of economic uncertainty.

4. Smarter loyalty programs powered by generative AI

Loyalty programs saw a tech-driven upgrade in 2024. Thanks to generative behavioral AI, brands could connect with individual customers more effectively, making it easier to encourage sign-ups.

Take Kiko Milano, for example. The cosmetics giant saw a massive membership boost for their "Kiko Me" loyalty program using real-time customer data. This allowed them to replace their generic offers with more targeted messages that clearly highlighted the perks of joining "Kiko Me." Within just a month, this thoughtful approach increased daily sign-ups by 1.92x – without relying on discounts.

5. Maximizing sales opportunities with generative AI

In 2024, the capabilities of generative behavioral AI took upselling and cross-selling to a whole new level. To illustrate what we mean by this, let’s take another look at M&S. By analyzing browsing behavior, customers exploring pajamas were seamlessly guided toward complementary products that Quin AI's Audience Engine predicted they would find appealing. This resulted in an impressive 24% of these shoppers adding extra items to their carts, showcasing the power of AI to enhance the shopping experience and drive sales.

What made this approach so effective was its precision. Instead of feeling pushy, the suggestions were unique for each visitor based on their in-session behavior, creating an intuitive shopping experience. In other words, M&S wasn't just increasing basket sizes – they were making the whole customer journey more enjoyable, making customers feel understood and valued.

6. Late-night conversions fueled by generative AI

In the last year, we’ve seen more brands use AI to find innovative ways to connect with customers during off-peak hours.

For instance, a leading sportswear retailer partnered with Quin AI to spot shoppers at risk of abandoning their carts during quieter nighttime hours. By delivering targeted incentives at the perfect moment, they re-engaged these customers and boosted revenue by an impressive 67% during those periods. This highlights how businesses can successfully use generative AI to stabilize conversion rates during less active shopping times.

7. Free delivery reminders to boost AOV

Free delivery has always been a powerful incentive for shoppers, but in 2024, generative AI elevated it into a strategic tool for driving sales. For instance, brands like Tommy Hilfiger leveraged this technology to pinpoint shoppers with smaller baskets and sent timely reminders about their free shipping thresholds, resulting in an impressive 3.04x increase in average order value. By showing customers how close they were to unlocking free delivery, Tommy Hilfiger not only boosted sales but also improved the shopping experience, making their checkout feel seamless and rewarding rather than purely transactional.

8. Engagement beyond discounts

As this round-up has shown, 2024 taught online retailers that discounts aren’t the only way to drive conversions. IKEA exemplified this perfectly. Rather than cutting prices, they focused on strategically promoting their 90-day return policy, resulting in a 40% increase in conversions within their bed product category. This approach highlights how value-driven incentives - such as convenience or peace of mind - can be just as impactful as discounts while protecting profitability.

9. Reducing friction at checkout

Generative behavioral AI proved essential in 2024 for overcoming one of the biggest challenges to online shopping: checkout friction. By analyzing real-time customer behavior, this technology helped businesses pinpoint exactly where shoppers were getting stuck during checkout. Whether it was simplifying forms, offering personalized payment options, or sending well-timed reminders, these tailored solutions made a big difference. The result? Fewer abandoned carts and a smoother, more enjoyable shopping experience that left customers feeling taken care of.

For example, Axcess Credit Cards used Quin AI to identify customers who abandoned their credit card applications halfway through. By delivering timely messages offering assistance and clarifying the benefits of completing the process, they successfully guided hesitant users back to finish their applications, resulting in a 1.52x completion rate increase. This highlights how businesses can easily use generative AI to streamline complex checkouts and remove obstacles that often lead to drop-offs.

10. Building loyalty through transparency and ethical AI

Today, 73% of shoppers are more concerned about their data privacy than they were just a few years ago. This growing awareness has compelled brands to focus on transparency and adopt ethical AI practices to earn customer trust. Shoppers increasingly seek reassurance that their personal data is being handled responsibly.

Generative behavioral AI stands out in this department for its ability to create personalized shopping experiences using only first-party data. Relying on real-time interactions and insights from visitors' own browsing sessions eliminates the need for intrusive third-party tracking, offering a more privacy-conscious approach.

This ensures compliance with privacy regulations, giving customers peace of mind that their information is secure. In return, brands can foster deeper trust and loyalty while still delivering the relevant, engaging experiences that shoppers have come to expect.

The road ahead

What’s evident from these ten trends is that shoppers expect more than ever before - seamless, tailored interactions that respect their time and privacy. Generative AI has proven highly effective in meeting these demands, helping brands not only boost sales but also build lasting trust and loyalty.

Ready to future-proof your e-commerce strategy? Book a demo with Quin AI today and see how you can implement these trends to drive growth and stay ahead of the competition.

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