As Artificial Intelligence enters every aspect of our lives and the consumer becomes more digitally educated she also becomes increasingly demanding and less trusting.
Large European and US ecommerce brands such as Amazon have realized the trend for more AI and have been using it in order to boost their sales. It principally collects and analyzes data in order to understand consumer tastes and trends, recommend products and personalize websites accordingly. Software companies such as BloomReach have been focusing on building tools to algorithmically empower ecommerce websites. Their aim is to understand and analyze what attracts customers to a site and how they’ll find what they’re looking for. The data used to fuel the machine learning mechanism isn’t so much about the customer per se; it focuses more on web relevance and what customers like. So if a person liked blue wine glasses the data suggests they’re likely to like green tablecloths. And if the customer doesn’t end up buying the suggested product the data is consequently fed into the machine for future use.
Far from the large brands that have been using machine learning for some time now, gradually smaller scale ecommerce retailers are adopting it with amazing results. A good example would be Otto in Germany. By use of a deep-learning algorithm they now have an AI system that predicts with 90% accuracy what will be sold within the following 30 days. So far the use of AI has only had positive results for Otto. It has allowed the company to hire more employees and to keep customers happy and coming back. Meanwhile, Indian fashion retail website Myntra produces clothes that are designed by software without any human intervention. According to Myntra’s chief product officer Ambarish Kenghe their next AI project is to create a fashion assistant that will be able to talk to customers and suggest to them what to wear on various occasions.
As consumers adapt to the changes of an increasingly digitalized world, retailers need to keep up if they want to keep them. Retail is undergoing a pivotal change in terms of customer engagement and as Stephen Scheeler, head of retail, automotive and QSR at Facebook Australia points out, retailers have to move from a traditional marketing mindset to one of real-time creativity in order to design the connected, consistent, and customized experience across devices that customers want.
Meanwhile, the increased consumer engagement with retailers through the social media has made them realize that another key for success is social media innovation. Mavi Jeans CEO Cüneyt Yavuz underlines that far from using social media channels in order to promote and sell they also use them to start a dialogue with their customers and interact with them through all available social media channels. Here too, AI systems are essential in order to manage the ever growing data that is generated and to handle the interaction with the consumers.
The above demonstrate that as AI, bots and intelligent assistants become more sophisticated, a growing number of retailers are using them to boost sales and they are doing so in various ways; whether that is personalized recommendations or analysis of customer behavior or managing social media interaction or even the creation of enticing products. Moreover gradually AI is used by all retailers regardless of their size and is becoming a necessary tool for their survival in an increasingly digitized world.