Chatbots for Retail: How They Work, Use Cases, Examples (2025)

Customers have more choice than ever—and even when other variables aren’t equal, it’s those who offer excellent customer service that often win the sale. 

Retail chatbots are the new 24/7 store associates, welcoming browsers, answering their questions, and even completing checkouts. And shoppers like them: Zendesk’s CX Trends Report found that 72% of consumers want immediate service from businesses, and some 64% will spend more if issues are resolved where they already are. 

Many tools are integrated with Shopify, so they can pull live inventory and customer data to create responses that feel human and personalized, while alleviating strain on your sales associates. Ahead, you’ll learn how the technology works, how to deploy them without compromising the customer experience, and retail chatbot examples to learn from.

What are retail chatbots?

Retail chatbots are software agents powered by large language model (LLM) AI that talk with shippers across live chat, SMS, social DMs, and even voice. 

Without any human assistance, retail bots can:

• Answer product questions
• Offer personalized recommendations
• Summarize returns policies
• Check order status 
• Complete a checkout

Unlike traditional rule-based chatbots which respond to users based on predefined scripts, generative chatbots interpret intent, pull real-time data from your store, and respond in consistent language across every channel. 

Plus, when deployed inside Shopify, they can tap into your store’s inventory data and unified customer profiles for responses. And if a request is too complex, they can hand it off to a human. 

Types of chatbots for retail and how they work

Virtual shopping assistants

Virtual assistants are conversational “personal shoppers” that stay with the customer from discovery to checkout. For instance, a shopper might ask for “black sneakers under $150” and get a carousel of in-stock options pulled from your store, then drop the chosen size straight into the shopping cart. 

This category is scaling quickly. Analysts project the market will exceed $8 billion by 2032—largely because customers are enjoying virtual shopping assistants. Some 55% say they’re open to letting an artificial intelligence (AI) agent actually place an order for them. 

Rule-based chatbots

Rule-based chatbots follow a decision tree that you make before deploying them. For example, if a customer asks, “Where’s my order?” or “What’s the return policy?”, the retail bot references your store’s policy or order tracking software to provide an answer.

Rule-based bots cannot handle more complex queries or learn from customer interactions like an AI-powered bot. But they offer immediate answers—a leading reason why 51% of consumers still prefer to interact with them over a human.

AI-powered chatbots

AI chatbots leverage LLMs to understand free-form questions, pull live data, and answer customer queries in brand voice—even when you haven’t given it a rule to follow. They also learn from every interaction and can provide insights like “20% of all chats are sizing questions” to refine product pages. 

McKinsey estimates this type of generative AI could unlock up to $310 billion in additional value for the retail industry, largely through customer-service automation and personalized selling.

📚 Read: Chatbot vs. Conversational AI for Customer Experience

Where to use retail chatbots

Chatbots have their place across the entire retail customer journey. Here’s where you typically find them:

• Feedback kiosks. Add a small touchscreen or voice-activated stand near doors to prompt shoppers for a one-question NPS survey (for example, “How was your visit today?”). A chatbot logs the answer, tag sentiment, and alerts your team if scores dip too low. 
• Self-serve product finder stations. If a shopper asks “Where can I find gluten-free pasta?”, the retail chatbot can return a store map pin with current promotions. 
• Mobile app live chat. When a customer opens the retailer’s app inside the building, GPS or Wi-Fi triggers an “Ask me in store” button. The chatbot can locate items, push personal offers, or start a locker pickup flow.
• Buy online, pickup in-store (BOPIS) text bots. SMS or WhatsApp chatbots confirm arrival—for example, “Reply ‘HERE’ when parked” for BOPIS orders—and cross-sell complementary items that can be added to the order in a single tap. 
• Post-purchase customer service line. A WhatsApp or Facebook Messenger bot answers “Where’s my order?” style questions. For in-store purchases, chatbots can process easy size-swap requests or warranty look-ups based on scanned receipt barcodes.

Benefits of retail chatbots

Provide instant support 

Customers expect responses almost immediately when contacting customer support. Chatbots are helping businesses meet that expectation. An AI-powered retail chatbot checks stock, answers FAQs, and escalates queries to a human customer service agent, so customers get help in seconds even during peak traffic or after hours.

In fact, HubSpot’s 2024 State of Customer Service & CX report found that 77% of service teams using AI are getting excellent results. Almost all (92%) say it improves their response time and improves satisfaction scores (86%).

Cost savings

Chatbots cut labor expenses by automating high-volume, low-value queries that often flood service teams. 

Data from IBM found that conversational AI cuts cost-per-contact by 23.5% and lifts revenue 4% on average. For retailers, this means you can handle more issues during peak shopping time (like Black Friday Cyber Monday) with less headcount, and free up budget for other growth initiatives. 

Apparel brand SilkySilky, for example, helped customer service team members double the number of emails they can manage in a day by deploying a retail chatbot powered by the Re:amaze app. 

Capture and analyze customer data

Every conversation—whether it happens at a curbside pickup bot on WhatsApp or a feedback survey—feeds directly into Shopify’s unified customer profiles, creating a single record that merges in-store and online touchpoints. These profiles update in real time, so you can deploy Shopify’s built-in segmentation tools to trigger tailored outreach.

For example, you could send a “back-in-stock” SMS to shoppers who asked about a sold-out size, or flag a high-value customer to store associates the next time that shopper walks in. You could also keep a record of customer preferences to personalize the retail experience through targeted promotions or recommendations.

This first-party data loop has been shown to lift average order values by up to 20% for brands using unified profiles.

Use cases of chatbots in retail 

Answer customer questions

Ecommerce chatbots can resolve simple customer issues in seconds. They can respond to queries about store hours, return windows, size charts, and warranty details, without the need for a human support agent to intervene. 

Order tracking 

Customers value transparency across the entire customer journey, especially after they’ve handed over their payment information and are awaiting a product’s arrival.

Gone are the days of hunting for a shipment email in your inbox. Customers can drop an order number (or check their status in the Shop app) and have the retail chatbot pull carrier status, predicted arrival, and delay alerts.

Personalized product recommendations

When you bring browsing history and sales data together, chatbots can offer personalized product recommendations that influence sales. The bot can recommend “you may also like” items or “complete the look” bundles on the fly, in context, when your customer is in purchase mode.

Shoppers are more open to these AI-suggested recommendations than you might think: Salesforce reports that AI agents drove $60 billion in incremental online sales during last year’s holiday season through personalized offers.

Locate nearby stores and check product availability

The vast majority of retail customers research a product online before they head in-store to buy it. Chatbots facilitate these omnichannel experiences. Mastermind Toys, for example, uses a chatbot on its ecommerce website that connects online shoppers to in-store associates. 

You can automate this process too, using AI-powered chatbot to retrieve inventory data from your POS systems and locate items for shoppers. If someone asks, “Is the black hoodie size large in stock near me?”, the bot can return live quantities and provide a reserve-in-store or ship to home link. 

💡Tip: Shopify’s unified commerce engine already syncs online and in-store stock, helping merchants that adopt it realize an 8.9 % gross merchandise value lift, on average.

Loyalty program management 

Customer loyalty programs incentivize repeat purchases. Instead of having customers locate your loyalty dashboard or ask a store associate to lookup their balance, retail chatbots let members check point balances, unlock tier rewards, or redeem perks with a tap. 

Plus, because all conversations flow into unified profiles when you use a Shopify-integrated chatbot, any redemption instantly updates the shopper’s segment for hyper-targeted follow-ups—such as a bonus-point flash sale for VIP buyers.

Manage returns and refunds

Returns are a necessary evil in retail. As much as you’d like to deter customers from returning merchandise, most refund requests are outside of your control. 

Limit the disruption in-store and cut down checkout by deploying a chatbot that can manage returns, refunds, or exchanges. When a customer types “I need to return my sneakers,” for example, the chatbot can verify order details, generate a return label, and—if your policy allows—issues an instant refund or store credit.

Fraud prevention

Not all orders come from legitimate customers. Chatbots tied to Shopify Flow or third-party risk solutions can flag suspicious orders in real time or verify unusual payment attempts by asking knowledge-based customer queries. This gives you a chance to intercept—for example, by cancelling the order or blocking known bad actors—before you process their payment. 

Collect customer feedback

Shoppers are willing to talk with chatbots and AI support agents. Why not ask for some feedback in the same session they get help? 

A retail chatbot can capture sentiment, log top complaints, and help your team respond proactively before customers leave a negative review. This is especially useful for retail staff training—you can educate store associates on how to improve customer service and boost store sales.

Best retail chatbot tools

Shopify Inbox

Shopify Inbox provides a great support toolkit with live chat, AI instant answers, and shopping cart insights. All inside the Shopify admin for free. It’s perfect for businesses that want simplicity and native integration. 

Notable features: 

• Shopify Magic instant answers and suggested replies
• Cart, product view, and order previews inside the chat panel for contextual upsells 
• Share discount codes, product links, photos, and order-status updates in one click 
• Message classification to flag chats likely to convert
• Automated greetings, away messages, and contact capture
• 20-language interface out of the box (including English, Spanish, French, German, Japanese, Portuguese, and Chinese)

Pricing: Free.

Tidio

Tidio bundles live chat, rule-based automation, and generative AI into one Shopify-friendly app. It also offers a help desk system that lets human agents pick up queries that the chatbot couldn’t handle, or instances where the shopper would prefer to talk to a person. 

Notable features include:

• Visual chatbot builder
• Ready-made templates
• Lyro AI agent trained on your site/FAQ 
• Cart and product previews inside the chat panel for contextual upsells
• Rule-based triggers for greetings, discounts, abandonment recovery, and surveys

Price: Free for 50 live chat users and 100 chatbot visitors per month. Paid plans start at $29 per month. 

Chatty AI

Chatty AI delivers a full help-desk stack (live chat, knowledge base, and a generative-AI agent) inside Shopify with an excellent support reputation. Its conversation-quota pricing keeps entry costs low, but make sure those quotas scale with your traffic before you rely on it for 24/7 coverage.

Notable features include:

• Upload URLs/CSV files to “teach” the chatbot about products and policies
• Visual FAQ helpdesk builder 
• Behavior-based pop-ups for upselling and discounts
• Auto-translate on paid tiers
• Unlimited chat history on Pro

Price: Free for up to 100 AI replies per month, 1 agent, and 20 docs. Paid plans start at $19.99 per month.

Best practices to use retail chatbots

Be realistic

Before integrating a new chatbot into your retail toolstack, set a clear scope from day one. Tell customers what the bot can and can’t do in the welcome message to manage expectations and prevent frustration. 

On the backend, track unresolved chat rate as a key performance indicator. If it rises, tighten the playbook rather than hoping the AI model will “just learn.”

Provide omnichannel support

Connect the chatbot to every touchpoint shoppers use, such as online live chat, WhatsApp, and social media platforms, so that conversations and data flow into a single customer profile. This gives a central source of truth for not only who your customers are, but how you can proactively support them through the conversation. 

Consistent intents and responses across channels also keep the brand voice steady and reduce training overhead.

Commit to regular training 

You never want your retail chatbot to give customers the wrong information. Upload new product catalogs, policy updates, and seasonal promotions at least monthly to keep the retail chatbot’s knowledge current. 

Similarly, review transcript analytics to identify misunderstood intents, then add example phrases or update the knowledge base accordingly. You could also split-test answers to see which has the biggest impact on customer satisfaction (CSAT) scores. These incremental improvements can have a significant impact on service recovery rates long-term.

Make human support an option

While retail chatbots are rising in popularity, not all customers enjoy interacting with them. Forced loops are the quickest way to tank CSAT scores.

Always display a “talk to a person” button or voice prompt in the conversation. Pass the full chat context to the agent (including order number, loyalty tier, and last messages) so customers never have to repeat themselves.