Macy's customers who use its new AI shopping assistant spend nearly five times more than those who don't. Frasers Group's equivalent tool lifted conversion rates by 25% in its first weeks. And Bunnings just launched its own AI "Buddy" across Australia. After years of hype about AI in retail, the receipts are finally arriving — and they're hard to ignore.
These aren't pilot programmes buried in investor footnotes. They're public, measurable results from household-name retailers deploying AI shopping assistants to real customers at scale. For business owners still weighing whether conversational commerce is worth the investment, this wave of data changes the calculation.
What Macy's Actually Built
Macy's launched "Ask Macy's" to the general public in late March 2026 after piloting it with roughly half its website visitors since December 2025. Built on Google's Gemini platform, the assistant lets shoppers describe what they want in plain language — "I need a dress for a spring wedding in Miami under $150" — and surfaces products, styling ideas, and "complete the look" suggestions.
The standout feature is virtual try-on: customers can visualise how an item looks on them without visiting a fitting room. Barbie Cameron, Macy's chief stores officer, told Bloomberg that customers are also using it in-store when they don't have time for a physical fitting.
The numbers are striking. During testing, shoppers who engaged with the assistant spent approximately 4.75 times more than those who didn't. Max Magni, Macy's chief customer and digital officer, attributed part of the lift to intent — chatbot users tend to be searching for something specific, like shoes for an event, rather than idle browsing. He also noted the tool appears to attract a younger demographic more willing to experiment.
"This is anybody's game. Nobody has cracked the code," Magni told Bloomberg. That candour matters. This isn't a victory lap — it's an early signal from a retailer that's been fighting a decade of declining sales and sees AI as a genuine path forward.
Frasers Group and the Conversion Lift
Across the Atlantic, Frasers Group launched "Ask Frasers" on its premium fashion and lifestyle platform (formerly House of Fraser) in April 2026. Powered by Algolia's Agentic Experience, the tool interprets product data — features, availability, real-time popularity — and delivers conversational responses to shoppers.
Early results showed a 25% increase in sales conversion rates compared to traditional search. That's a significant lift for a technology that's been live for weeks, not months.
Richard Lallo, group head of customer marketing at Frasers Group, said the launch "marks an important step forward in this mission, enabling us to offer a faster, smarter and more seamless way to shop our premium fashion and lifestyle offering, reinforcing our belief that intelligent technology is shaping the future of retail."
The Frasers deployment is notable because it's not a bespoke Google partnership — it uses Algolia's platform, which is available to mid-market retailers. The barrier to entry for conversational commerce is dropping fast.
Australia Is Already in the Game
Australian business owners don't need to watch this trend from afar. Bunnings launched "Buddy" in April 2026 — a Google Cloud Gemini-powered assistant that can photograph handwritten shopping lists, suggest products for renovations, estimate project costs, and connect customers with local tradies. Woolworths is upgrading its Olive chatbot with agentic AI capabilities, turning a basic support bot into a meal-planning assistant that reads photos of handwritten recipes and builds shopping baskets.
Meanwhile, Tesco in the UK is trialling its AI assistant with 280,000 colleagues before a customer launch, built in partnership with Tomoro AI (an OpenAI-allied consultancy). The pattern is unmistakable: the world's largest retailers are all building conversational commerce layers simultaneously.
The Broader Data Picture
Individual case studies are compelling. The aggregate data is even more so.
Across 329 brands studied by Alhena AI, AI-assisted shopping touches just 1% of site visitors but drives roughly 10% of total sales — a 10x sales multiplier. Shoppers who engage with AI during their session convert at 12.3%, nearly four times the 3.1% baseline. Bloomreach's Clarity AI shopping agent reports a 9% conversion lift and 20% higher average order value across its early customers, with South African retail group TFG achieving a 35.2% higher conversion rate during Black Friday testing.
Ali Furman, PwC's US consumer markets industry leader, told Bloomberg that the most effective tools work "less like a chatbot and more like a personal shopping agent who knows the assortment and understands your preferences." That distinction matters. The first generation of retail chatbots — glorified FAQ pages — failed because they answered questions nobody was asking. This generation succeeds because it mirrors what a great in-store salesperson does: understand intent, recommend with confidence, and close the sale.
What This Means for Your Business
You don't need Macy's budget to act on this. The lesson from the Frasers Group deployment is that platform-based solutions — Algolia, Bloomreach, and Shopify-native tools like Preezie (a Melbourne-based company) — are bringing conversational commerce to mid-market retailers at accessible price points.
The practical starting points for a business running an e-commerce operation:
Start with cart recovery. Conversational AI on abandoned carts delivers the fastest measurable ROI. Industry data shows proactive AI chat recovers 35% of abandoned carts compared to 5–15% via traditional email retargeting. For a store doing $1 million in annual revenue with a 70% cart abandonment rate, that delta represents hundreds of thousands in recovered sales.
Put AI on high-intent pages. Don't deploy a chatbot on your homepage and call it done. The conversion lift comes from intercepting shoppers on product pages where they have specific questions about compatibility, sizing, or use cases — the 70% of queries that are about product validation, not discovery.
Measure correctly. Most AI conversations happen mid-funnel. Last-click attribution will undercount their value. Track session-level conversion rates for visitors who interact with AI versus those who don't — the way Macy's and Frasers Group are measuring.
What to Watch
The next inflection point is in-chat purchasing — what McKinsey calls agentic commerce. OpenAI has already partnered with Target, Instacart, and DoorDash for purchasing directly inside ChatGPT. Visa and Mastercard are building payment tokens for AI agents. When consumers can say "buy me running shoes under $120 for wide feet" and an AI agent handles the entire transaction, the retailers with well-structured product data and AI-ready catalogues will capture that demand. Those without will be invisible.
Magni's admission that "nobody has cracked the code" is actually the most bullish signal in this story. It means the winners haven't been decided yet. For businesses willing to experiment now — even with off-the-shelf tools on a modest budget — the opportunity to build conversational commerce muscle before the market matures is real, measurable, and time-limited.
Sources
- Macy's Debuts New Tool Causing Customers to Spend 400% More — Entrepreneur
- Macy's Says Users of New Gemini AI Chatbot Spend About 400% More Online — Bloomberg
- Macy's AI-Powered Shopping Assistant: Customers Who Use It Spend Nearly 400% More — Fortune
- Frasers Group Launches AI Shopping Assistant, Sees Conversions Jump 25% — Retail Gazette
- Bunnings Launches AI Shopping Assistant 'Buddy' Across Australia — News.com.au
- Woolworths to Incorporate Agentic AI into Its Olive Chatbot — Digital Nation Australia
- Tesco Launches Large-Scale Colleague Trial of New AI Assistant — Tesco PLC
- The Agentic Commerce Opportunity — McKinsey
- Bloomreach Delivers Consequential Impact with Clarity — Bloomreach
- AI Commerce 2026: 329-Brand Conversion Report — Alhena AI
