Dive Brief:
- Wayfair is investing in AI to enhance its product discovery, personalization and customer service, executives said on a Q3 2025 earnings call Tuesday.
- The Wayfair app’s Discover tab now incorporates learnings from its Muse AI generation tool, which generates shoppable images of rooms, according to CTO Fiona Tan. The updated tab boosted visit duration and conversions.
- Wayfair implemented AI into its image carousels to showcase products that match the customer’s lifestyle and aesthetic, according to Tan. The company plans to further improve personalization by incorporating factors like weather and the customer’s location into the carousels in the near future.
Dive Insight:
Wayfair is just getting started with its AI features, according to Tan.
“Our promise to customers is to make it easy for them to create a home that's just right for them, and the rapid evolution of AI represents a considerable opportunity to deliver on that promise in new ways,” Tan said during the call.
The retailer’s AI investments aim to help it deliver experiences that go beyond simple personalization, according to Tan. Wayfair has embedded AI into its core processes and provided AI tools to every employee, investments that are expected to further elevate its CX capabilities.
Wayfair’s on-site search now uses a large language model to go beyond keywords when helping customers find what they’re looking for, and the company’s visual search lets shoppers find similar products based on photos, according to Tan.
In customer service, Wayfair has rolled out fully autonomous conversational AI agents that are available to answer common inquiries on a 24/7 basis, according to Tan.
The company is still making live agents available for more complex calls, and Wayfair uses intent-based routing to connect customers with the right expert to handle their issue, according to Tan. The agents are equipped with an AI copilot that can help them find proactive solutions to customers’ problems when a standard product replacement isn’t enough.
“This holistic system is designed to live first contact resolution and post contact satisfaction, all while reducing our cost to serve and driving down waste,” Tan said.
Wayfair’s CX investments, which showed signs of paying off in the previous quarter, contributed to sales growth. Total net revenue rose 8.1% year over year to $3.1 billion in the third quarter of 2025, according to a company earnings release.
However, not all aspects of the business were positive. Active customers fell 2.3% year over year to 21.2 million, while Wayfair’s net loss grew to $99 million from $74 million in the third quarter of 2024.
