65% of Holiday Shoppers Plan to Use AI, but Just 8% of Retailers Feel Prepared

Steve Madden, a client of Narvar, is leaning into AI for holiday.

COURTESY OF NARVAR

Steve Madden believes it is prepared for the holiday season as consumers increasingly turn to AI. The broader retail sector may not be. A new report from Narvar finds that shoppers are adopting AI for holiday commerce faster than retailers are building the systems needed to support it. The company, which provides AI-enabled customer experience and post-purchase technology, says 65% of consumers plan to use AI for at least one part of their holiday shopping this year. Just 8% of retailers describe themselves as very confident in their ability to use AI to improve the shopping experience.

The challenge is not simply generating an answer. Consumers tend to experience AI as a single, continuous conversation, while retailers often rely on disconnected systems. Providing an accurate response may require combining product information, inventory, personalization, fulfillment rules and returns data, each managed across different networks.

“I don’t think the biggest challenge is the AI itself, it’s connecting the infrastructure behind it,” said Colleen Waters, vice president of ecommerce at Steve Madden and a Narvar client. “It’s one answer. It’s a good answer, but it’s just one part of the journey. Consumers are moving very quickly from an answer to simple questions to expecting retailers to understand the full context. That’s a bigger operational leap for retailers.”

The disconnect is central to Narvar’s 2026 Holiday Shopping Report, which surveyed 100 retail decision-makers and 1,348 U.S. consumers to assess whether retailer capabilities align with consumer expectations this season.

Narvar provides infrastructure for retailers including eBay, Sephora and several LVMH brands. Shoppers who purchase from those companies may encounter Narvar-enabled services along the customer journey. The company says its platform reaches 98% of the U.S. population.

As retail has changed, Narvar’s role has expanded beyond package tracking and delivery estimates, said CEO Anisa Kumar. The company now positions its work around “brand hospitality” rather than simply helping customers locate a parcel and determine when it will arrive.

“Actually, brand hospitality started in hotels, airlines, and kind of went down that path to where now retailers need to be thinking about it,” Kumar said. “There’s this broader concept of brand hospitality. Given that, we wanted to understand how consumers are thinking about AI and how they’re going to be using it.”

Steve Madden began using ChatGPT at checkout early and has spent years improving its customer journey. “I’m most interested in places where AI can remove work for the customer and streamline the path to purchase,” Waters said.

AI can give Steve Madden insight into what a customer is buying, how the shopper reached the e-commerce site, and which products or messages the customer has already viewed or engaged with. The company is also seeking context from other channels so the experience feels more connected.

A customer may arrive through email, social media, an AI platform or a Steve Madden store, Waters said. “We see every interaction as a blank slate,” she added. “We do a better job with that than some others. That includes search and recommendations, outfitting and making our products and content more useful.”

For the holiday season, Steve Madden plans to concentrate on three priorities: helping shoppers find the right product more quickly, determining whether AI gives them enough confidence to buy, and identifying where it can remove friction across channels.

“Holiday is a great time for testing because consumers are extremely mission driven,” Waters said. “Everybody loves free shipping. It’s something we use in our loyalty program. Speed, everybody’s used to Amazon. You have to be honest with the consumer about when they’ll be getting their order. We try to meet customers where they are. If you live within a certain radius of our stores you can order a shoe and have it delivered by DoorDash like a pizza.”

“We definitely do see this anecdotally ticking up right from the beginning of the year,” Kumar said. “In consumers surveyed the numbers keep increasing as the months go by. Right now, purchases are not happening at scale on frontier models like Gemini. People are using them for discovery, for comparing, for budgeting and for to-do tasks.”

“If you’re not feeding the frontier models with the right information, you can’t come up with the right comparison when consumers are looking to compare or they’re looking to understand where their return is or where their shipping order is,” Kumar added. “You’ve got to have the data that’s feeding where the consumer is doing the research.”

“It will be interesting to see with holiday what the promotional cadence looks like,” Waters said. “It’s been a roller coaster for a few years with tariffs. Money is always top of mind with our customers.”

AI can help consumers navigate those constraints. Shoppers can tell an AI agent who they are shopping for, the recipient’s age and their budget, then receive guidance from a brand-agnostic personal shopper. Waters said the opportunity is not to add technology to shopping for its own sake, but to make the process more useful.

Consumers are not necessarily rejecting AI; they are rejecting poor experiences that happen to be powered by it. Customers generally do not care whether an interaction uses AI, Kumar said. The problem arises when a bot reaches a dead end, fails to understand a question or creates friction instead of solving a problem.

Consumers increasingly expect a connected experience, which raises the bar for retailers, Waters said. “The more they use ChatGPT, Gemini or Claude, the more those platforms know them. On the retailer side that raises the bar on information, from being discoverable to being understood. This holiday will be a big learning period for retailers. It’s a big shift we’re seeing this holiday season.”

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