Trends

AI and e-commerce: How they cooperate in Germany

AI and E-commerce: How they Cooperate in Germany


AI is shaking up e-commerce everywhere – predicting what customers want, optimizing supply chains, and even chatting with shoppers. 

But in Germany? Things are a little more complicated.

Despite having some of the best AI research in the world, German businesses haven’t turned that knowledge into a full-blown e-commerce revolution just yet. Regulations are strict, digital adoption is slow, and many companies (especially smaller ones) hesitate to embrace AI.

But that doesn’t mean Germany is out of the game. Far from it. 

AI is already impacting logistics, fraud detection, and customer service. And with the right approach, German e-commerce could be on the verge of something big.

So, what’s working? What’s holding businesses back? And where is AI in German e-commerce headed next?

Let’s take a closer look.

The state of Germany’s e-commerce & AI adoption

When it comes to e-commerce, Germany stands as a formidable force in the global arena, with its market projected to reach $141.2 billion in 2025 – it’s positioned as the sixth-largest worldwide. This growth trajectory is underpinned by:

  • a robust digital infrastructure
  • and a population that increasingly embraces online shopping

Source

The German e-commerce market is dominated by a couple of big brands and marketplaces. Three of them are:

All right, what about AI?

Regarding integrating Artificial Intelligence into business operations, Germany exhibits a cautious yet progressive stance. In 2021, AI ranked 20th among future technologies in Germany. It trailed behind areas like cybersecurity (14th place) and the Internet of Things (18th place). Now, however, AI is becoming more critical.

Source

The country itself ranked 16th in digital transformation among European countries. Through this, we see Germany’s slow progress in the development of artificial intelligence despite its economic potential after all.

As of 2024, 19.8% of German businesses have adopted at least one AI technology. However, this adoption rate still trails behind frontrunners like Denmark, where over 27.6% of businesses have embraced AI solutions.

Next, only 37% of German businesses invested in any AI in 2024, and over half of German AI companies (52%) believe EU regulations slow innovation. The AI Act, introduced in June 2024, imposes transparency rules and bans harmful AI applications, adding another layer of complexity.

Source

Moreover, in 2024, Germany’s AI patent share was at only 6%, significantly lower than China (29%) and the US (27%)! Such a patent gap highlights Germany really struggles to compete globally as an AI provider and affects e-commerce AI advancements. China also has the best rate of external trade in artificial intelligence.

Source

Source

For the broader context, the AI technologies most commonly implemented by EU enterprises, and to some extent in Germany, include:

  • Text mining. It’s utilized by 6.9% of businesses to analyze written content.
  • Natural language generation. Employed by 5.4% for generating human-like text.
  • Speech recognition. Adopted by 4.8% to convert spoken language into machine-readable formats.

What do German consumers think about AI?

90% of shoppers in Germany believe that AI has not significantly improved their online shopping experience. 82% of respondents do not find AI-driven product recommendations useful, suggesting that personalization algorithms may not be effectively tailored to German consumers’ preferences. 58% feel that chatbots are less effective than human support, and 58% have never purchased an item based on an AI recommendation.

Source

In addition, around 50% of Germans view AI’s rise as more positive than negative, yet 52% believe AI harms human relationships. Concerns over privacy, automation replacing jobs, and unclear regulations create uncertainty here. 

Right now, AI in Germany is more of a slow climb than a breakthrough, but sooner or later, businesses will have to jump in if they want to stay competitive.

How AI is used in German e-commerce today

Now, let’s see how AI is currently being utilized in Germany’s online retail sector.

Personalized shopping and recommendations

E-commerce retailers in Germany rely on AI-powered recommendation engines to increase sales, improve customer experience, and stay GDPR-compliant. For example, one of the biggest fashion retailers in Germany – Zalando uses AI to engage users, reduce returns, and align with strict data privacy laws like GDPR.

Source

Generally speaking, AI algorithms analyze browsing history, purchase behavior, and preferences to suggest relevant products. At least, that’s how it should be. But something is wrong with AI recommendations in the country. 

The above Statista survey revealed that 82% of German shoppers do not find AI-driven product recommendations useful. So, there’s a gap between AI’s potential and consumer perception.

AI in logistics and supply chain optimization

Retailers and logistics companies in Germany use AI to manage inventory, optimize delivery routes, and forecast demand. Otto, one of the largest e-commerce players, applies AI to:

As a result, they prevent unnecessary markdowns, storage costs, and reduce overstock.

AI-driven automation just makes logistics more efficient, cost-effective, and eco-friendly. Companies know AI can make supply chains smarter, but full adoption takes time. Yet, they automate warehouses and fine-tune last-mile delivery to reduce waste, cut fuel costs, and speed up shipments.

German businesses focus heavily on sustainability, and AI plays a role here too. AI-powered route optimization software helps delivery companies cut CO₂ emissions by selecting the most efficient paths. Consumers demand faster, greener shipping, and AI helps make it happen.

➡️ Read about sustainability and supply chains here.

Chatbots and AI-powered customer service

Online retailers in Germany use AI chatbots to handle orders, answer questions, and resolve basic issues. These tools make customer service faster and cheaper, allowing businesses to scale support without hiring more staff. DHL, for example, uses AI for smart assistants. But, many German shoppers don’t trust AI chatbots, as Statista stated above. They avoid them when dealing with complaints, refunds, or product issues. AI can answer frequently asked questions, but many customers still prefer talking to a person for anything more complicated.

Businesses see conversational AI as the future, and investment proves it. The German conversational AI market, worth $310.7 million in 2023, will likely hit $1.141 billion by 2030.

Source

Companies work to improve chatbot accuracy and make AI sound more human. Some brands combine AI and human agents, letting chatbots handle simple queries while humans take over when things get complex.

AI in fraud detection & payment security

Online fraud is a growing issue, and AI helps companies spot suspicious transactions before damage is done. Klarna, a leading payment provider, uses AI to analyze customer interactions, get insights into consumer behavior, and track unusual activity in real-time.

Cyber threats are forcing businesses to act fast. AI enhances security, but online crime keeps evolving. Stronger security helps protect businesses and customers, but AI-driven fraud detection must comply with GDPR rules. Privacy regulations limit how much consumer data AI can analyze, making fraud prevention a balancing act between security and compliance.

One more time about challenges to implement AI in German e-commerce

Germany has the brains, the infrastructure, and one of the biggest e-commerce markets in Europe. But now we know that when it comes to AI, things move painfully slow. 

Here are the challenges.

  • Germany lags in AI patents and digital transformation

Germany holds just 6% of global AI patents and ranks 16th in Europe for integrating digital tech into business. That’s a problem. Patents signal technological leadership, and Germany just isn’t producing enough cutting-edge AI breakthroughs to lead the market. Digital transformation is another weak spot. Some large e-commerce players (like Zalando and Otto) use AI, but many mid-sized and smaller retailers still rely on outdated systems. While other countries push AI forward, Germany gets stuck in endless discussions about regulations and risks.

  • Lack of skilled AI professionals

Germany needs people who understand how to build AI and use it. That’s where things get tricky. There aren’t enough AI specialists to meet demand, and companies struggle to fill tech positions. Universities produce top researchers, but many leave for better opportunities abroad. The hiring struggle is real. AI salaries are high, and small-to-midsize companies can’t compete with big tech firms. A shortage of skilled AI professionals means fewer businesses can actually integrate AI tools.

  • Reluctance of SMEs to adopt AI

Smaller businesses? Many don’t even experiment with AI as they feel it’s an expensive, complicated step. Also, for small retailers, AI sounds risky. Many prefer reliable, proven systems over expensive AI-driven experiments. The learning curve is steep, and with strict regulations like the AI Act, some businesses just don’t see the benefit of jumping in yet.

  • Data privacy concerns

Germany’s approach to AI integration is heavily influenced by a stringent regulatory framework designed to protect consumer data and ensure ethical AI deployment. 

Central to this framework are:

  • GDPR – General Data Protection Regulation. Enforced since 2018, it mandates rigorous data protection measures affecting how e-commerce businesses collect, store, and process customer information. Compliance requires companies to implement robust data security protocols and obtain explicit consent for data usage.
  • AI Act – Proposed by the European Commission, this act aims to establish comprehensive guidelines for AI applications, categorizing them based on risk levels. For German e-commerce enterprises, this means adhering to specific standards, especially when deploying AI in areas like customer service, personalized marketing, and automated decision-making.

Navigating these regulations necessitates a delicate balance and many just are afraid to do so.

The future of AI in German e-commerce

While Germany is slow to implement artificial intelligence, statistics show that it will get better. Businesses are starting to look beyond chatbots and product recommendations. They explore new ways to improve sales, fulfillment, and sustainability.

Voice commerce and AI-powered visual search are set to change how Germans shop online. Smart assistants could make ordering as easy as speaking a command, and AI-driven image search will let customers find products just by snapping a picture.

Germany is serious about sustainability, and AI can help retailers reduce their environmental impact. Smarter logistics mean fewer empty delivery trucks, lower emissions, and less wasted inventory. AI-driven demand forecasting helps prevent overproduction, which is a big problem in fashion and consumer goods.

The German government knows AI adoption needs a push. AI funding is growing, and programs are in place to help smaller businesses adopt AI without massive upfront costs. The goal? Close the gap, support innovation, and ensure Germany doesn’t fall behind global competitors.

Conclusion

Germany has the talent, the funding, and the market size to make AI a bigger part of e-commerce. What’s missing is faster action from businesses and clearer paths for smaller players to adopt AI without drowning in costs or regulations. 

Some retailers already use AI to personalize shopping, optimize logistics, and prevent fraud, but many are waiting on the sidelines. The companies that embrace AI now – while competitors hesitate – will be the ones leading German e-commerce in the next decade.

So, waiting isn’t an option. The opportunity is there. It’s time to act.