AI based machine learning and algorithms are transforming the way we interact online and subsequently the way we buy and sell online. Not only can AI perform the tasks we used to do manually, but also provide retailers with the information needed to make informed business decisions.
Here are 6 ways AI will transform and drive e-commerce in the future:
Targeted marketing and personalization: Advances in AI and machine learning have enabled retailers to leverage big data to better predict future purchases and design personalization techniques to customize content based on a customer’s preferences, while delivering messages that will most resonate. By sifting through big data, AI algorithms can retrieve actionable insights into customer behaviour to better predict customers’ needs. They can also use the information from customers’ shopping history to suggest products that will align with their ‘search result’.
Chatbots and virtual assistants: As retailers compete to provide the best customer experience, the use of chatbots and virtual assistants are increasing. Providing 24/7 assistance, they contribute enormously towards efficient sales processes. These chatbots and VAs can interpret voice-based interactions through natural language processing (NLP) and generate relevant results to provide personalized offers to customers.
Increased customer retention: A McKinsey omnichannel personalization research indicates a 10-15% uplift potential in revenue and retention from omnichannel targeted marketing and personalization. Intelligent customer engagement at every point is key when it comes to customer retention.
Seamless automation: From scheduling emails in a CRM or marketing tool, leveraging AI can help automate repetitive tasks that enables the smooth functioning of an online store. With AI, retailers can automate product recommendations, loyalty discounts, low-level support, and more.
Smarter logistics: Machine learning help to predict transit times, demand levels, and shipment delays using real-time information through sensors, RFID tags, and such, for inventory management and to better forecast demand. Over time this will help retailers build better predictions for their supply chain and logistics functions.
Better inventory management: Forecasting sales and inventory management has become a necessity for every business. Using AI’s predictive analysis, businesses can make estimates about the future demands in the market and accurately predict the inventory needed as well as the quantity required. AI can anticipate quick changes in demand and conduct preventive maintenance to increase efficiency.