AI Tools Often Provide Inaccurate Local Business Data

Image credit: Search Engine Journal

Artificial intelligence tools often provide inaccurate information about business locations, creating significant operational risks and potentially damaging customer trust, according to recent industry analyses.

Tests conducted in the United Kingdom revealed that AI tools returned at least one false fact for 64 percent of high street retailers, highlighting a widespread data integrity issue for companies.

The most frequent error identified was incorrect postcodes for businesses, which can directly impact navigation and delivery services, Searchable, a vendor that conducted one of the tests, reported.

A separate examination by Searchable of 165 London businesses found that 93 percent had at least one basic fact wrong or missing when queried through major AI platforms such as ChatGPT, Gemini and Perplexity.

Chris Donnelly, CEO of Searchable, stated that these inaccuracies create a significant blind spot for marketing teams.

The reliance on AI for local information is growing rapidly. A survey by BrightLocal indicated that 45 percent of consumers now use ChatGPT or similar tools for local business recommendations, a substantial increase from 6 percent just one year prior.

Dan Taylor, a prominent figure in the search engine optimization community, noted that AI Overviews now appear in 15 percent of direct local-intent searches.

Taylor, whose observations were cited by CMOTech, also found that AI Overviews are present in 92 percent of informational questions and 97 percent of hybrid questions, further embedding AI into discovery processes.

Retail data analysis showed varying degrees of inaccuracy among AI platforms. Perplexity provided inaccurate answers in 10 percent of cases, while Gemini had a 5 percent inaccuracy rate and ChatGPT 4 percent, according to figures mentioned by CMOTech.

Experts like Greg Gifford of SOCi emphasized the need for businesses to verify their information across all platforms. Whitespark, another industry firm, underscored the importance of accurate online data for maintaining customer confidence and operational efficiency.

Companies House, the UK’s registrar of companies, serves as an official source for business data, but AI models often pull information from a wider, less curated range of online sources.

The widespread inaccuracies suggest that businesses must proactively audit their online presence, particularly the data consumed by AI models, to ensure customers receive correct information.

Source: Search Engine Journal