Swedish fintech firm Klarna has evolved from a buy now, pay later venture to an AI-powered payments and e-commerce company. Sebastian Siemiatkowski, co-founder and CEO, is leading the transformation, including talks on partnering with Perplexity, an online search engine enhanced by artificial intelligence. We talked to him about how the hot technology will shake up shopping in an edited conversation below.
The View From Sebastian Siemiatkowski
Q: Klarna has taken the AI revolution seriously with a revamp to TikTok-style content that’s hyper-targeted based on user interests. But another vision of the AI-enabled future seems almost the opposite, where people ask large language models what they should buy. Instead of getting an influencer trying to sell them products, the AI lays out the pros and cons of each option and just does the research. How does Klarna fit in?
A: Both versions you describe are complementary to each other. Our recent Future of Retail report found that 26% of U.S. Gen Zers and Millennials expect the shopping experience to be so customized that AI will eventually do the shopping for them. On the other hand, 85% of consumers still like speaking with product experts when shopping online.
The future of shopping will include a combination of hyper-personalization based on users’ unique preferences, AI-shopping assistants, and content creators that connect people and products through entertaining experiences.
E-commerce has historically been very transactional and static, and the reality is people miss the emotional element of shopping at the mall with their friends. Enhancing both the online shopping journey through curated, AI-driven content, while maintaining a meaningful, human touch will be very important. Perplexity is a fantastic company and we’re excited to collaborate with them and others on how we can make these experiences come to life.
Q: How do you see advertising and marketing changing in an AI-driven world? What happens if we’re just chatting with AI bots instead of browsing websites and TikTok?
A: Today in the Western world, 80% of e-commerce is search-driven, whereas in China we are seeing the opposite — 80% of e-commerce is driven by AI-powered recommendation engines, while 20% is through search. Marketers and advertisers benefit immensely when they can more accurately reach their target audiences and tailor their content to meet consumer expectations.
One of Klarna’s biggest differentiators is our SKU-level data, which enables us to provide consumers with highly personalized shopping experiences with unmatched depth and detail, and better match them with new brands and offers that are relevant to them. With over 300 billion data points, we see the consumer’s product purchase, images, size and color.
Q: Klarna is diversifying beyond payments and moving into advertising/marketing. But do you see any possibility that AI enables a commerce landscape that actually does revolve around fees and commissions, rather than marketing and ads?
A: The creator economy is thriving and I don’t believe the model of affiliate marketing will go away any time soon; if anything it will evolve based on consumer behavior with the help of AI. But that’s just one part of the mix.
We’re in the business of matching consumers with retailers and content creators to ultimately help the consumer save time, money, and worry along their financial and shopping journey.
Last month we launched our new AI-powered shopping feed in the Klarna app, as well as our plug-in with ChatGPT, to offer a more tailored shopping experience, and we continue to expand our growth tools for retailers and creators to create more customized experiences that drive revenue.
Q: What did you think about Apple’s Vision Pro announcement? Shopping in 3D has always been one of those things people always say is coming.
A: I have yet to try it out, so we’ll see! Klarna’s data shows over 75% of Gen Zers and Millennials expect [augmented reality] to enhance their in-store shopping experience, and one-third think that this technology will eventually become standard across retail stores.
Shopping will evolve to all kinds of formats, and data will play a key role in the brands that succeed to do this best.