How Bunnings Uses AI Agent Technology to Reshape the Trade Customer Experience: Strategic Expansion from DIY to the Commercial Market

From DIY to B2B: Bunnings' Next Stop in AI Strategy

Australia's largest hardware chain, Bunnings, is taking its AI innovation to new heights. Following the launch of its AI assistant "Buddy" based on Google Cloud Gemini Enterprise in April this year, the company's CIO Genevieve Elliott revealed at the Sydney Google Cloud Summit that Bunnings will extend this technology to its important trade and commercial customer segments.

This decision is significant for Australia's retail industry and the application of commercial technology. Bunnings has over 400 stores in Australia and New Zealand, with its DIY business long dominating the market. However, it is the trade and commercial customers—including builders, renovators, and contractors—who are the true high-frequency purchasing group. By deepening its focus on this segment with AI technology, Bunnings is essentially installing a "smart engine" for Australia's largest building material consumer group.

The Success of "Buddy"

"Buddy" has delivered impressive results since its launch. Elliott revealed that the AI assistant has doubled Bunnings' online conversion rate and significantly increased average order value. Its core capability lies in understanding users' DIY project needs and recommending multiple related tools or materials, rather than simple single-item searches. For example, when a user asks "how to build a wooden planter," Buddy lists the required wood, screws, paint, and other items, linking to the corresponding product pages.

This "task-oriented" AI interaction model is a typical application of agentic AI. Unlike traditional chatbots that passively answer questions, Buddy proactively plans and combines solutions, thereby creating higher commercial value. Elliott attributes Buddy's success to "expanding our boundaries of what’s possible for delivering the best customer experience."

AI Opportunities for Trade Customers

Bunnings already offers self-checkout and receipt management for trade customers in its PowerPass app, but the introduction of AI will fundamentally transform service models in this area. Elliott stated that Bunnings is using the GECX platform to "reimagine how we support trade and commercial customers," acknowledging that some features can be implemented immediately while others will take time.

For builders and contractors, the value of AI is clear: bulk price inquiries, automatic material estimation for projects, cross-store inventory checks, personalized purchasing recommendations, and more. For instance, when a construction company takes on a new project, AI can automatically generate an optimal procurement plan based on the drawing list, matching Bunnings' inventory and promotional information. This deep integration not only improves efficiency but also enhances customer loyalty.

Technology Infrastructure and Market Impact

Bunnings' technology investment is not an isolated move.Bunnings' technology investment is not an isolated event. As a core asset of the Wesfarmers Group, Bunnings has been continuously increasing its digital efforts in recent years, with its technical capabilities described by Elliott as "severely underestimated." This deep collaboration with Google Cloud further solidifies its position as a leader in Australian retail technology.

From an industry perspective, Bunnings' AI strategy sends three key signals:

1. Retail AI applications shift from "Q&A" to "agents": Buddy demonstrates the commercial viability of agent-based AI in retail scenarios, especially in the highly complex, high-ticket building materials sector.

2. B2B digitization enters the intelligent stage: Trade customers often rely on traditional procurement models; AI can provide data-driven decision support, accelerating industry efficiency improvements.

3. Technology barriers and competitive advantages: Retailers that deploy AI on a large scale first will gain significant advantages in customer experience and operational efficiency.

Trade Level and International Expansion

Bunnings plans to extend Buddy's availability from Australia to New Zealand and introduce it on product pages. This international expansion path indicates that its AI capabilities are now replicable. For the Australian economy, the technological upgrade of Bunnings as a local retail giant helps enhance the overall innovation level of the retail industry and maintain a leading position in the Asia-Pacific building materials retail market.

Investment Perspective

Investors in Wesfarmers (ASX:WES) should focus on the marginal benefits brought by Bunnings' digitalization. Bunnings contributes about 60% of Wesfarmers' profits, and its AI-driven efficiency improvements and customer expansion will directly boost the group's performance. At the same time, the partnership with Google Cloud also implies future growth in cloud service spending, though the return on investment is expected to be substantial.

Long-term Trends

Over the next 3-5 years, AI agents will become standard in retail. Bunnings' practice shows that it is not only tech giants that can harness AI; traditional retailers can also achieve leapfrog innovation through quality partnerships. As AI technology matures, Bunnings may extend the Buddy model to more product categories or even open it to third-party platforms, thereby building an AI-centric building materials ecosystem.

Conclusion

Bunnings' extension of AI agent technology from DIY to trade customers is an important milestone in the digital transformation of Australian retail. This move not only strengthens its position as a leader in building materials retail but also demonstrates the practical value of AI in complex business scenarios. For investors and industry observers, Bunnings' AI journey is worth continuous tracking—it may be painting a new intelligent business landscape for Australian retail.