The upcoming peak shopping season in Australia, encompassing Black Friday and Christmas, is poised to test the limits of traditional customer loyalty. According to new research commissioned by supply chain and commerce technology leader Manhattan Associates Inc., the rapid adoption of artificial intelligence is reshaping how consumers search for deals and interact with brands. The study reveals that a striking 85% of Australian consumers are willing to switch retailers if an AI tool identifies a better price for the same product elsewhere.

This shift comes on the heels of a record-breaking period last year, where Australian shoppers spent $23.8 billion over the extended Black Friday sales period, according to data from CommBank iQ. As retailers prepare for another highly competitive sales window, the integration of AI into consumer shopping habits introduces a volatile new variable to market dynamics.

The AI Disruption of Retailer Loyalty

For years, brands have relied on established customer loyalty and direct-to-consumer relationships to secure sales during peak periods. However, the widespread availability of AI-powered shopping assistants is lowering the barrier to price comparison, making it easier than ever for shoppers to bypass their preferred stores.

The survey conducted by Manhattan Associates indicates that 83% of Australian consumers expect AI to play a role in their shopping activities over the coming months. Rather than relying on brand affinity, consumers are leveraging technology to optimize their spending. The primary drivers for using AI during this shopping season include:

  • Comparing products, brands, or retailers (36%)
  • Finding the best deals or lowest prices (35%)

Raghav Sibal, Vice President APAC at Manhattan Associates, highlights the challenge this poses to traditional retail strategies. According to Sibal, AI provides consumers with an entirely new mechanism to compare retailers, which directly challenges established customer loyalty. If a shopper can easily locate the same product for a lower price elsewhere, they are far more likely to purchase from an unfamiliar retailer.

The Trust Gap: Verification and Transaction Preferences

While Australian consumers are highly receptive to using AI to discover deals, they remain cautious about the accuracy of the information provided. The research shows that 78% of respondents (nearly eight in ten) would verify an AI-recommended deal against the retailer's official website or other sources before finalizing their purchase.

This trust gap is driven by specific concerns regarding the reliability of AI outputs. When asked what information they would be most likely to double-check, consumers identified several key areas:

  • Price accuracy and discount validity (52%)
  • Product information and customer reviews (23%)
  • Delivery times or associated costs (20%)

Furthermore, this caution extends to how transactions are completed. Although 35% of Australians express comfort in completing a purchase directly through an AI shopping assistant, a clear majority of 53% still prefer to finalize their transactions directly on the retailer's own website or application. This preference underscores the ongoing importance of maintaining robust, secure, and user-friendly digital storefronts.

Stock Availability and Fulfilment as Key Differentiators

While price is a powerful motivator, it is not the sole factor determining where a consumer completes their purchase. When multiple retailers offer the identical product at the same price, operational execution and logistics become the primary battlegrounds.

According to the research, when AI recommendations are presented with identical pricing, consumers prioritize the following factors:

  • Nearby stock availability (39%)
  • Free delivery options (28%)
  • Faster fulfilment times (27%)

To facilitate localized searches, 75% of Australians (three in four) state they are willing to share their location data with an AI shopping assistant to locate stock nearby. This willingness to share personal data highlights the premium consumers place on immediate product availability and convenient local pickup options.

Sibal emphasizes that attracting a customer via an AI recommendation is only the first step. Retailers must be prepared to deliver on consumer expectations once they arrive at the digital storefront. If the advertised price is inaccurate, the product is out of stock, or the delivery timeline is unacceptable, consumers will quickly abandon their carts and look elsewhere.

Strategic Implications for Retailers

To convert AI-driven interest into confirmed sales, retailers must focus on operational fundamentals. During high-volume shopping periods, having real-time, accurate inventory visibility across all sales channels is critical. Retailers must also offer flexible fulfilment options to accommodate diverse consumer preferences, whether they choose home delivery or local pickup.

By unifying front-end customer interactions with back-end supply chain execution, businesses can ensure that the promises made by AI assistants are fully realized at the point of sale and delivery.

Methodology Note: The findings are based on a survey of 500 Australian consumers commissioned by Manhattan Associates.