Erin Gates, a resident of Calgary, Alberta, finds herself on the road quite often. With three of her four children participating in ice sports during the winter and the family frequently heading out to ski, Erin is no stranger to driving long distances on highways and attending out-of-town tournaments. This means navigating through varying winter conditions, including snow, slush, and ice. Recently, Erin invested in a used minivan and realized she needed reliable winter tires. However, the process of selecting the right tires proved to be daunting.
Fortunately, Erin discovered a helpful resource in Canadian Tire’s new AI-powered shopping assistant named CeeTee. This innovative tool, represented by a friendly, waving red triangle, aids customers in choosing the perfect tires by asking relevant questions and providing options based on their answers. Whether through voice or text, customers can interact with CeeTee to compare different tires, check availability at their local store, or receive personalized recommendations based on specific criteria such as bestsellers or ongoing sales.
“I found it really helpful,” says Erin. “It immediately showed me three different kinds of winter tires at varying price points and even informed me about the stock available at my store. I loved how conversational it was, like chatting with someone at the store who is knowledgeable about tires.”
Launched in March, CeeTee is accessible via the Canadian Tire app. Despite the fact that 95% of Canadian Tire’s sales occur in its more than 500 stores across Canada, a significant portion of transactions—up to 80%—begin with a visit to the retailer’s website. Recognizing this trend, Canadian Tire developed CeeTee to connect customers with suitable tires before they even step into a physical store.
According to Ilana Santone, Senior Vice President of Digital and Connected Retail at Canadian Tire Corporation (CTC), the company’s mission is to enhance the lives of Canadians. A crucial part of this mission is ensuring that customers can quickly find the products they seek. Most customers start their shopping journey online, which sparked the idea behind CeeTee. “We asked ourselves: ‘How can we reduce the barriers to getting them to the right product more efficiently and easily?’” Santone explains. “That’s how CeeTee came to be. We identified the major friction points in the customer journey and explored ways to eliminate these barriers or support customers both online and in-store. Generative AI provides an opportunity to achieve this in a new or even better way.”
CeeTee was developed in collaboration with Microsoft and operates on Azure OpenAI Service, utilizing OpenAI’s GPT-4. It combines internal product data with knowledge from the large language model to assist customers in selecting the right tires. Extensive testing was conducted to avoid potential errors, and controls were implemented to prevent misuse. Under the company’s data privacy policy, any information provided or collected during interactions with CeeTee is anonymized and only used to refine the model. Customers are asked for their consent before using the tool. Since its launch, the AI assistant has drawn nearly 10,000 users and recorded over 700,000 chat sessions, according to CTC.
Canadian Tire’s new AI-powered shopping assistant helps customers choose tires by asking questions and making recommendations based on their responses.
### ‘True Consultative Sellers’
CTC, which began with two brothers acquiring a tire shop in Toronto in 1922, has expanded over the years into a general merchandise retailer offering a wide range of products, from auto parts to sports equipment, clothing, home decor, and tools. Now, according to Santone, CTC sees the potential for generative AI to address some of its significant challenges, such as connecting customers with the right products.
Tires, a core offering of Canadian Tire, were chosen as the initial category due to the complexity of the buying process. With a substantial share of Canada’s tire market, around 18%, CTC views CeeTee as an opportunity to capture additional market share while better serving the 2.2 million active customers who use its app.
“Although we already have a substantial market share, the remaining market share in Canada is quite dispersed,” states Cari Covent, the company’s head of AI and emerging technology. “Introducing this type of assistance for tire purchases could set us apart from other automotive service organizations or tire companies.”
The retail industry has long employed AI for tasks such as inventory management and customer service, notes Sudip Mazumder, Senior Vice President and Retail Lead at Publicis Sapient, a global digital consultancy. Over the past year and a half, retailers have increasingly adopted generative AI to engage customers and boost productivity.
Mazumder highlights some major retailers in the cosmetics and fashion industries that offer “virtual try-on” capabilities, allowing customers to try out makeup, clothing, and other products virtually before purchasing. Other companies, like Canadian Tire, are using generative AI for virtual assistants that provide personalized recommendations or equip employees with information to better assist customers.
Generative AI’s ability to facilitate a dialogue, Mazumder explains, results in a richer and more satisfying customer experience. “It means that retailers become true consultative sellers, guiding customers through their entire shopping journey,” he says. “Every retailer, big and small, is pursuing this type of use case.”
Mazumder views CeeTee as a valuable tool for customers facing a costly and sometimes complex decision. A driver navigating the rainy streets of Vancouver will have different tire requirements than a commuter in Saguenay, Quebec, which receives around 10 feet of snow annually. “I think this will help customers,” he says. “The process now becomes much more streamlined.”
John Motuz, a resident of Vancouver Island in British Columbia, has tried CeeTee and is impressed. He plans to purchase a set of all-weather tires soon and says he will “definitely” use the shopping assistant to make an informed decision. “You enter your car details and the type of tire you’re looking for, and it provides some excellent suggestions,” says Motuz, who, like Gates, participated in a customer survey in exchange for a gift card. “It was almost like a chat, but much quicker and more relatable. It’s super easy to use.”
Mazumder anticipates that generative AI will transform various aspects of retail, from customer service to supply chain operations and content creation. However, he emphasizes that AI cannot replace human interaction. “Human touch is crucial in retail,” he asserts. “If you become too reliant on AI, your customer experience could feel sterile. At some point, you want to involve a human in the process.”
Canadian Tire sees CeeTee as an opportunity to further increase its high share of the country’s tire market while better serving the 2.2 million customers who use its app.
### An Evolving AI Strategy
In June 2023, CTC and Microsoft announced a seven-year partnership aimed at leveraging Azure AI tools to better serve customers and drive innovation in Canada’s retail sector. This collaboration is part of a broader, long-term AI strategy at CTC, explains Covent. Nearly a decade ago, the company began using AI to automate manual tasks, such as a bot that enables purchase coordinators and category business analysts to make bulk changes to active purchase orders. “This bot has saved the company close to one million dollars with minimal investment to build,” Covent notes.
Recognizing the need to effectively harness its data, CTC brought in a team of data scientists and began migrating data to the Azure cloud platform. It developed AI tools and capabilities, including a centralized analytics platform, a system to better understand customers, and a solution using store-specific data to determine the optimal product mix on shelves.
Additionally, CTC launched data and AI literacy training programs for board members and employees and created a chatbot using Azure OpenAI Service called ChatCTC. Now used by over 4,300 of CTC’s corporate employees, ChatCTC assists in summarizing documents, generating content, writing code, and supporting administrative tasks. According to Covent, the tool saves users between 30 to 60 minutes each day.
The company is taking a “very measured approach” with CeeTee, Santone states, and will study how customers use it over the coming months. While the tool could eventually be expanded to other product categories and additional channels, including major smartphone operating systems, the company chose to focus on tires initially. “Tires is a highly, highly complex business,” Santone remarks. “This is about examining the tire journey from start to finish and removing friction from the buying process to provide customers with the best experience on the market.”
“After all, we’re Canadian Tire,” she adds. “If we can’t solve the tire journey, who will?”
For more information, you can visit the Canadian Tire website.
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