AWS claims that third-party agents are yet to deliver great customer experience.
In its third-quarter earnings call, the technology platform saw a strong earnings result following significant investments in AI.
When questioned on the future of agentic e-commerce, Amazon claimed that most of these third-party agents currently lack the capabilities required to deliver ‘acceptable’ customer experiences.
Amazon CEO, Andrew Jassy, expressed difficulty in finding a third-party to partner with for AI shopping agents.
He said, “Right now, I would say the customer experience is not – there’s no personalization.
“There’s no shopping history. The delivery estimates are frequently wrong. The prices are often wrong.”
He also notes that despite its sudden upsurge, creating AI agents is still “harder than it should be.”
Currently, these agents are unable to deliver the required seamlessness and reliability requirements that consumers expect.
However, Jassy remains determined that the future of agentic commerce will greatly improve the online shopping experience, narrowing down personalized choices using accurate user context.
Amazon has also announced its plans to continue investing to keep up with AI trends, after adding more than 3.8 gigawatts of AWS power capacity during the past 12 months, doubling the capacity levels of 2022, as well as expecting to add another gigawatt by the end of the quarter.
Despite AI adoption still being at the start of its journey, Amazon believes this can benefit its customers by introducing the features early on to avoid the competition.
This investment has included the recent launch of Project Rainier, a multi-data center housing almost half a million Trainium2 chips to advance its agentic AI systems and support AI-based services, expecting to double by the end of the year.
Success in AI Features
AWS has already seen successful innovations with AI in retail this quarter.
Currently, the company is already working with several internal AI features to improve online shopping experiences.
Rufus
An AI assistant designed for consumers to ask shopping-related questions, recommendations, and product comparisons to offer source-generated responses.
This feature saw 250MN active customers, with a monthly interaction increase of 140% and a year-on-year growth of 210%. It also found that customers were 60% more likely to buy an item by using Rufus.
AI-Powered Audio
The GenAI-powered audio feature simplifies shopping experiences, allowing users to listen to a summarized audio description of the product, as well as analyzing customer reviews and product details to give you access to the needed information at the top of the page.
This feature has now been enabled for millions of products, with AWS reporting a total of almost 3 million minutes listened.
Amazon Lens
Lens has been enhanced with an AI visual search tool that reduces product discovery time by allowing you to scan products using product images and bar codes.
The tool also now offers Lens Live, which can be used to find products as well as showing similar recommendations via a swipeable carousel in real-time, seeing a monthly customer usage of 10 million.
Key Earnings Results
The big news was Amazon Connect hitting $1BN in annual revenue after improving its efficiency and personalization capabilities for both agent and customer.
This was a result of 12 billion minutes in customer interactions with AI handling each year for AWS customers such as Toyota, American Airlines, and Capital One.
Other notable figures include:
- In annual revenue, Amazon saw a 12% increase of $180.2BN
- Across year-on-year increase, the company saw its improved growth rate of 20.2%, its highest in 11 quarters
- Its operating cashflow still saw upwards of 16% increase at $130.7BN despite major investments in AI
- However, its free cash flow decreased from $47.7BN the previous year to $14.8BN
