OTTO tests AI assistants in partnership with Google Cloud

GenAI has been an integral part of public debate since the beginning of 2023. Now OTTO, the largest German online store, is allowing its customers to test AI directly in their own store for the first time. “Many users search for specific product information by going through product reviews and scrolling through endless results. But it can be made easier with the help of AI”, explains Olaf Schlüter, Division Manager Product Management Shopping Platform at OTTO. “That’s why at OTTO, we are testing an AI assistant, making us the first online store in Germany to introduce a real innovation in online retail.”

At least 50 reviews, for all product ranges: this is how OTTO’s AI assistant works

The new AI assistant is very straightforward: customers enter their questions in a chat bar directly above the product reviews on otto.de. They then receive an answer within seconds based on existing reviews, the product description, and the product title. To ensure that the answers remain as balanced as possible despite the subjective nature of product reviews, OTTO only deploys the AI assistant across all product ranges for items with a minimum of 50 product reviews. At the start of the test run, customers will find this option available for approximately 180,000 items, ranging from shoes and carpets to coffee machines and sofas.

The long-term goal of OTTO’s AI assistant is to provide better guidance, increase customer satisfaction, and reduce return rates. To achieve this, OTTO uses the PaLM 2-“Large Language Model” (LLM, a language model) from Google and combines it with their own data, including product reviews, descriptions, and titles, with the help of Google Cloud Vertex AI. The data always remains with OTTO. The LLM ensures that OTTO’s AI assistant can recognise questions and answer them in the best possible way, even if they contain spelling errors or customers use colloquial language. The AI assistant was developed by the Otto Group “Digital & Consulting” team in collaboration with OTTO colleagues, and subsequently integrated into the online store.

AI marks a milestone for online retail

“Our philosophy at OTTO is to try out new technologies as quickly as possible and then make them accessible to all of our customers”, adds Olaf Schlüter. “An artificial intelligence that assists in customer service and provides advice based on such extensive data is a milestone for online retail. The test run with the AI assistant gives us the opportunity to accurately compare whether and how helpful AI really is for customers.” This is why, during the test phase that has now started, OTTO is working with two groups: one half of the customers will see the AI assistant, while the other half will not have access to it for the time being.

Incidentally: in addition to testing the AI assistant, OTTO is already using artificial intelligence in various other areas to further improve the shopping experience in the online store. For example, OTTO displays so-called clusters above the product reviews, which summarise the most important elements from the customer reviews – these are also based on algorithms. Other AI systems are used for image recognition and fraud prevention, among other things.