It wasn’t so long ago that the concept of AI, or artificial intelligence, seemed to many like science fiction. But now, we come across AI on a daily basis. Indeed, much of our engagement with the apps and online services we use regularly relies on artificial intelligence.
For example, anyone that has ever used Google Maps while driving and heard the narrator say that a faster route has become available has benefitted from the work of AI. The recommended videos on Netflix or YouTube have been selected just for us, and personalized using AI that’s informed by viewing choices we’ve made in the past.
But how does AI help ecommerce businesses?
AI in Online Retail
AI is now being taken advantage of by retailers. Take, for example, the suggestions we see when we visit online retailers. These suggestions—the ones that appear after we’ve added an item to our carts, or even items on the sides or bottom of a specific item page—have all been carefully selected for us using AI algorithms.
The same goes for products we see featured under the “recommended for you” or “customers who viewed this item also viewed” sections of retailer web pages. These are all suggestions driven by analyses of data gathered about our online activities. And these analyses are led by machines, not humans.
Find out how your ecommerce business can increase profits using AI. Contact Personali, today.
How Online Retailers Can Boost Profits with AI
Here are some of the ways online retailers can use AI to boost profits:
1. Analyze and use huge amounts of information
It’s practically impossible for humans to analyze and act on the huge amounts of data that can be gathered about online shoppers. Much less implement incentives according to that data in a timely manner. AI, however, can analyze more data exponentially quicker to help retailers design incentives based on unique shopper behaviors. AI can, in real-time, inform retailers on new incentives shoppers will find attractive, taking the time, analyses and guesswork out of the equation for human marketers.
A great example of AI being put to use this way is GWYN, or “Gifts When You Need” by 1-800-Flowers. This AI-powered “concierge” asks online shoppers questions about their needs and then offers products accordingly. This is an effective way of both collecting necessary data from shoppers and using AI to apply it instantly in a way that helps increase sales and customer satisfaction.
2. Implement AI in shopping apps
Today, more people than ever are shopping online. This is partly because more people than ever own smartphones and other devices that make online shopping easy and convenient. It’s also due in part to the fact that today’s consumers are more Internet savvy than ever before; according to IBM, more than 60% of consumers will spend 15+ minutes comparing products online.
With this, shopping apps that make the online shopping experience even smoother are becoming ever more prevalent. What’s also changing are our expectations as shoppers: we’re now demanding greater levels of personalization from the retailers that serve us. And if those expectations aren’t met, we quickly move on.
AI’s analysis capabilities allow online retailers to deliver informed, data-based incentives that best suit customers. While customers greatly value incentives that appear to have been designed just for them—a win for the customer—these incentives also drive more customers to buy—a win for the retailer.
AI incorporated into online retailer shopping apps can remember purchase and browsing history and suggest products and discounts based on the user’s behavior. AI used in these apps can also alert shoppers directly on their mobile about offers, sales and other promotions they’ll be most interested in.
3. More effective customer service through chatbots
Many online retailers already employ intelligent chatbots that can offer immediate, around-the-clock support to their customers, to varying degrees of sophistication. The AI technology behind these chatbots is constantly advancing, enabling AI to understand and participate in conversations with humans.
Chatbots help online retailers enhance the customer experience and boost profits through quick and efficient customer service. Rather than waiting for a live representative, customers can use chatbots to instantly solve issues they’re encountering. On the retailer side, these chatbots also offer another opportunity for collecting and analyzing data that can help the retailer improve their site, app and more. Data collected through chatbots enables retailers to predict future buying patterns and create autonomous replenishing systems.
Lowe’s, for example, has implemented LoweBots in the San Francisco Bay area. These bots can answer questions from in-store customers and locate items for them as they shop. These machines help Lowe’s keep track of inventory and also stay up-to-speed on shopper patterns to help the company make better business decisions.
AI can do more than chat and analyze customer data
You can embrace AI as a method for eliminating costly, time-consuming content testing. Testing at the hands of marketing and sales professionals involves a number of touchpoints (messaging, text positioning, call-to-action, etc.) that make it difficult to implement the exact array of changes needed to achieve the best possible communication—especially if you’re targeting a variety of consumer types. AI can quickly shed light on the web page layouts and messaging that work best for a number of audiences without the need for testing and analyzing.
Evolutionary algorithms (EAs) are a subset of AI that help improve the customer experience and grow sales. EAs create a group of potential solutions (for example, solutions to content presentation) that are tested. New groups of potential solutions are then automatically developed and tested based on the most successful solutions from previous groups. In other words, EAs can test variations of messaging, images and layouts, constantly creating better options to find the best solution.
In order to boost your online retail profits, you should find a solution that uses AI and EAs to take care of the “heavy lifting”, so you can deliver the best possible online user experience, boost sales and loyalty. The most effective type of ecommerce platform is one that is based on machine learning algorithms, like Personali, which can help you deliver highly targeted incentives to specific shopper segments at precisely the right moment.
Contact us to learn more about how AI, EAs and Personali’s platform can help your online business increase profits.