New York, June 12, 2023 (GLOBE NEWSWIRE) -- According to MarketResarch.Biz, the Generative AI in E-commerce Market was valued at USD 0.5 Bn in 2022 and is anticipated to reach USD 2.1 Bn by 2032, registering a CAGR of 14.9% from 2023 to 2032.
The global generative AI in E-commerce market includes software solutions, platforms as well as services that use generative AI algorithms to provide E-commerce businesses with different functionalities like product recommendations, chatbots, personalized shopping experiences as well as fraud detection. The market is driven by the maximizing demand for personalized shopping experiences, the need for efficient inventory management & pricing optimization, and the increasing use of AI and machine learning in E-commerce. The market is expected to grow significantly in the upcoming years, with a vast range of applications and use cases emerging as technology continues to advance.
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Key Takeaway:
- By deployment model, the on-premises segment generated the largest revenue share of 46% in 2022.
- By technology, the machine learning segment generated the largest revenue share of 36% in 2022.
- By application, the B2C segment generated the largest revenue share of 19.36% in 2022.
- In 2022, North America dominated the market with the highest revenue share of 42%.
- The Asia Pacific region is expected to grow at a significant CAGR from 2023 to 2032.
Factors Affecting the Growth of the Generative AI in E-commerce Market
- Requirement for personalized and efficient shopping experiences: The requirement for personalized & efficient shopping experiences among customers is a key factor driving the growth of the generative AI in E-commerce market. The more demand there is for live experiences, the more opportunities there are for generative AI solutions.
- Investment in AI & machine learning technologies: The level of investment in AI & machine learning technologies by E-commerce businesses can impact the growth of generative AI in E-commerce market. Higher the investment, more opportunities arise for generative AI.
- Regulations & Policies: Regulations & policies related to AI & machine learning can impact the growth of generative AI in E-commerce market. Policies that promote the uses of AI & machine learning can drive growth, while policies that restrict their use can hinder growth.
- Competition: Competition among generative AI solution providers and E-commerce businesses can impact the growth of generative AI in E-commerce market. Increased competition can lead to more innovation and investment in the market, while decreased competition can slow down growth.
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Top Trends in Global Generative AI in E-commerce Market
Conversational commerce is a trend that contains the uses of chatbots and other conversational interfaces to enable customers to interact with E-commerce businesses through natural language processing. This trend is driven by the requirement for more personalized & efficient shopping experiences. Ethical & responsible AI is a trend that prioritizes the development of AI solutions that are transparent, explainable as well as bias-free. This trend is driven by the rising concern around bias and discrimination in AI.
Market Growth
The growth of the market can be attributed to different factors, including the increasing adoption of AI and machine learning technologies, the maximizing demand for personalized and efficient shopping experiences, and the rapid advancement of AI and machine learning technologies. Additionally, the rising adoption of E-commerce across the globe is making the latest opportunities for generative AI solutions that can help E-commerce businesses enhance efficiency, minimize costs, and provide better shopping experiences for customers. This is further driving the rise of the market. Moreover, as more E-commerce businesses invest in AI & machine learning technologies, we can expect to see more innovative & sophisticated generative AI solutions being developed, further driving the growth of the market.
Regional Analysis
North America is the leading region in the global generative AI in the E-commerce market. owing to the high adoption rate of advanced technologies and the presence of major players in the region. The US & Canada are expected to be the major contributors to the growth in this region. The rising demand for personalized and efficient shopping experiences among customers is driving the adoption of generative AI solutions in the E-commerce industry in North America.
Competitive Landscape
The market for generative AI in E-commerce is highly competitive, with a few established players and new entrants competing for market share. These players offer a range of AI & machine learning solutions that can be used to enhance the efficiency of E-commerce processes and provide a better customer experience. For Example, IBM Corporation is one of the leading players in the market for generative AI in E-commerce, with a significant market share.
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Scope Of Report
| Report Attribute | Details |
| Market Value (2022) | US$ 0.5 Bn |
| Market Size (2032) | US$ 2.1 Bn |
| CAGR (from 2023 to 2032) | 14.9% |
| North America Revenue Share | 42% |
| Historic Period | 2016 to 2022 |
| Base Year | 2022 |
| Forecast Year | 2023 to 2032 |
Market Drivers
By automating numerous processes including inventory control, price optimizations', and fraud detection, generative AI can increase the effectiveness of e-commerce enterprises while saving time and resources. The increasing demand for personalized shopping experiences is one of the biggest motivators for the use of generative AI in E-commerce. To create personalized product recommendations and shopping experiences that are catered to each customer's tastes, generative AI can analyze customer data. This can increase customer happiness and loyalty. E-commerce companies may scale up their operations rapidly and cost-effectively without the need for expensive hardware or IT infrastructure thanks to the cloud-based deployment of generative AI technologies.
Market Restraints
The development and implementation of generative AI solutions can be expensive, especially for small and medium-sized E-commerce enterprises with tight resources. Large volumes of consumer data must be gathered and processed in order to employ generative AI in e-commerce, which raises questions about data security and privacy. The adoption of generative AI solutions may be constrained by the severe data protection requirements that E-commerce companies must follow, such as GDPR. Some E-commerce companies may find it difficult to build and apply generative AI solutions because they lack the technological know-how and specialized skills that are necessary.
Market Opportunities
Businesses that can create and put into precise cutting-edge solutions that enhance the customer experience and boost productivity will have a lot of room to expand in the market for generative AI in E-commerce. As the market for generative AI in E-commerce is anticipated to grow globally, allowing businesses to reach into new client categories, expanding into new geographies is one of the key growth prospects. Additionally, generative AI can be used with other technologies, such as blockchain and the Internet of Things, to create more sophisticated and effective E-commerce solutions. Collaboration with other companies can also result in the creation of fresh, creative generative AI solutions that can enhance consumer satisfaction and spur expansion.
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Report Segmentation
Deployment Model Insight
With a 46% market share, the on-premises sector dominates the generative AI deployment model segment in the E-commerce market. Because of its flexibility, economy of scale, and scalability. Cloud-based deployment enables organizations to use generative AI solutions from any location with an internet connection without the need for expensive hardware or IT infrastructure. Other advantages of cloud-based deployment that are crucial in e-commerce include the ability to manage vast amounts of data and real-time insights.
Technology Insight
Machine learning dominates the technology segment of generative AI in the E-commerce market with a 36% market share. Machine learning is a widely used technology in E-commerce, especially in the context of personalized product recommendations. Machine learning algorithms can analyze large amounts of data to identify patterns & trends, and then uses this information to make product recommendations tailored to the preferences of each customer. This is an increasingly important capability for the E-commerce sector as customers demand personalized and relevant shopping experiences.
Application Insight
The B2C segment is expected to dominate the market in the forecast period with a revenue of 19.36%. The increasing demand from consumers for personalized and efficient shopping has led to the adoption of generative AI products, such as personalized product suggestions and virtual try-ons by E-commerce businesses that sell directly to consumers. The B2C segment will also benefit from the increased use of machine-learning algorithms in E-commerce. These algorithms can analyze large amounts of customer data to generate customized product recommendations and improve E-commerce processes.
Market Segmentation
Based on Deployment Model
- Cloud-based
- On-premises
- Hybrid
Based on Technology
- Natural Language Processing
- Computer Vision
- Machine Learning
- Speech Recognition
- Augmented Reality
Based on Application
- B2B
- Personal
- Business use
- Seasonal use
- B2C
- Other Applications
Key Regions
- North America
- The US
- Canada
- Mexico
- Western Europe
- Germany
- France
- The UK
- Spain
- Italy
- Portugal
- Ireland
- Austria
- Switzerland
- Benelux
- Nordic
- Rest of Western Europe
- Eastern Europe
- Russia
- Poland
- The Czech Republic
- Greece
- Rest of Eastern Europe
- APAC
- China
- Japan
- South Korea
- India
- Australia & New Zealand
- Indonesia
- Malaysia
- Philippines
- Singapore
- Thailand
- Vietnam
- Rest of APAC
- Latin America
- Brazil
- Colombia
- Chile
- Argentina
- Costa Rica
- Rest of Latin America
- Middle East & Africa
- Algeria
- Egypt
- Israel
- Kuwait
- Nigeria
- Saudi Arabia
- South Africa
- Turkey
- United Arab Emirates
- Rest of MEA
Market Key Players
- Alibaba Group
- Walmart
- Shopify
- Magento
- com Inc
- IBM Corporation
- Other Key Players
Recent Development of the Generative AI in E-commerce Market
- In March 2021, IBM announced the launch of IBM Watson Orchestrate, a new product that uses AI to automate routine tasks and processes. This product is expected to help E-commerce businesses improve efficiency and reduce costs.
- In May 2021, Salesforce announced the acquisition of artificial intelligence startup, Parse.ai. This acquisition is expected to help Salesforce improve its AI capabilities and provide more personalized customer experiences for E-commerce businesses.
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