What do most people think when they hear the term “Artificial Intelligence”? While the term might seem like it fell off a science fiction novel, it has become a significant part of our daily lives. Artificial Intelligence is an algorithm-driven modern learning technology that many industries have profited from and continue to do so. One of these flourishing industries is eCommerce, where automation has helped modern-day online retailers make intelligent business decisions and improved customers’ purchasing experiences. In this post, we will precisely discuss the role of AI in eCommerce and help readers get acquainted with its indispensable benefits.
Is AI an eCommerce competitive advantage?
AI is becoming a staple in our lives. It is already helping us with self-checkout cash registers, automatic security checks at airports, online shopping, and more. More and more businesses are using AI-driven solutions! A report by Gartner claims that the number of companies fostering AI has jumped by 270 percent. Still, numbers can be deceiving. So, is AI a competitive advantage?
Well, running an eCommerce store isn’t children’s play. Business owners have to compete with other retail businesses! They have to manage several business operations and processes, make them more efficient, generate sales, and maximize their revenue. Managing the operations and processes has become quite challenging especially due to the post-pandemic surge in eCommerce.
Indeed, leaders can hire more people to run their online stores. But will they be able to work 24/7 and/or without making errors? They can close such gaps using Artificial Intelligence and machine learning solutions that run on data. AI gets the job done quicker, more efficiently, and without causing any errors. In other words, it assures online retailers of improved productivity and efficiency so they can focus on tasks that are more challenging.
Top benefits of AI for eCommerce brands in 2023!
Should companies deploy AI in their eCommerce operations? Here are some of the most compelling reasons why their eCommerce store needs AI and machine learning in the coming years.
Helps with eCommerce dynamic pricing
Most eCommerce brands have tons of products on their sites. And the number of products might never cease to increase. What will these brands do if they have to change the prices of these products? They just don’t have the time to manually change the prices, do they? It can get excessively stressful and hectic. Instead, they should use AI-driven solutions that help them with dynamic pricing. All they need to do is set the data points and the AI solutions will easily adjust the prices across the inventory. Dynamic pricing is based on several factors like capacity, market conditions, competition, customer behaviour, available inventory, demand, and more. AI helps consider these factors and execute dynamic pricing to perfection.
Facilitates fraud detection and prevention
Fraud is the biggest enemy of an established and emerging eCommerce brand. The global fraud index for the month of October 2017 reached a staggering $57.8 billion! eCommerce companies just cannot let this slip. We highly recommend they prioritize fraud detection and prevention to keep their eCommerce brand and associated customers safe. Artificial Intelligence and machine learning can help them make real-time decisions related to fraud prevention. The technology can implement risk scoring to detect factors leading to fraud. Such AI solutions can even prevent hacks by introducing multiple layers of authentication.
Allows social listening
eCommerce brands thrive on customer feedback. And one sure shot source of reliable customer feedback is social media. We highly recommend enabling social listening to have a firm grip on what the target audience is talking about. Artificial Intelligence helps with social listening as several AI-powered solutions can track online conversations over social media networks. This is made possible when eCommerce brands define the set of keywords and phrases AI can use to filter the conversation — building a highly reliable social listening foundation. Social listening is extremely helpful in keeping a check on the audience’s emotions, improving weaker areas of the business, and making informed strategic business decisions.
Bolsters customer service support
The customer service department needs special attention, especially if a company is building an eCommerce store. Most unsatisfied customers will go through customer support before leaving a bad review. So, bolstering customer support service is indispensable. This is where AI-driven chatbots come to the rescue. These chatbots help companies save billions of dollars every year. Potential eCommerce customers will first need some answers to their questions before they go ahead and make purchases. These questions are generally about the eCommerce company’s credibility. Therefore, the situation demands an instant and effective response. With chatbots, eCommerce brands can ensure a prompt response 24/7, which also helps cut down on costs associated with call centres.
Improves capacity for personalization
Implementing Artificial Intelligence in any business is simply a way of easing things out via technology. eCommerce brands can use modern technology to indirectly lessen the workload so that they can focus on operations that matter the most, for example, scaling the eCommerce business. AI allows eCommerce companies to implement personalization — a major factor for smart marketing campaigns that give them the opportunity to interact with their customers efficiently. We have numerous personalized intelligent automation tools and services that businesses can use and interact with customers instantly. AI-powered personalization also helps improve targeted emails, personalized ads, and product recommendations.
Leverage predictive marketing
Bring in AI-driven positive changes in eCommerce business operations, especially if they lack performance. Business owners must realize that modern-day consumers love to use social media apps like Instagram and Facebook and, at the same time, use them to make purchases. Since these social media applications are also AI-powered, it makes perfect sense to use them to understand the audience’s behaviour and choices. In other words, eCommerce brands can use AI for predictive marketing and provide recommendations to their customers. Predictive marketing helps optimize an eCommerce site to maximize the possibility of customers looking at a certain product and purchasing it. It helps put the most favourable products on top where the customers can see them. This indirectly results in more sales.
Chatbots and virtual personal assistant
AI and machine learning-driven chatbots are a rage in eCommerce and have singlehandedly changed the way customers interact with businesses online. These chatbots have helped companies cater to the needs of their customers 24/7 while answering their queries to perfection. The ability to provide customers with correct and instant responses has made it easier for eCommerce brands to stay in touch with potential customers, and push them further into the buyer journey. These eCommerce brands also use virtual personal assistants, a form of a chatbot, but smarter. A VPA does an excellent job of keeping companies updated with the performance of different business operations. It is a must-have AI-powered solution, especially to meet the surge in the upcoming holiday season.
Complete eCommerce automation
Lastly, Artificial Intelligence can help eCommerce businesses grow manyfold through the magic of automation. eCommerce businesses are run by several operations and processes that are predominantly repetitive. Such tasks are to be executed on the loop. Business owners have the opportunity to improve the efficiency of these tasks by using AI-driven automation tools. This helps significantly simplify the frontend and backend workflow and allows business owners to focus on tasks that matter more.
What is the future of AI in eCommerce?
Is AI a fad? Will it become irrelevant in the coming years? We are hit with these questions every day, left, right, and center. Here’s an answer to the sceptics — the implications of advancements in technologies like AI and machine learning are beyond human imagination. Frankly, it is quite difficult to wrap our heads around how AI is transforming eCommerce at present. The way it intelligently (and consistently) collects, analyzes, and presents customer data points to help identify purchase patterns is quite extraordinary. The insights help online retailers successfully forecast future purchasing patterns. No wonder experts at Business Insider and Tractica predicted that the profit generated from AI applications in eCommerce will increase by $59.8 billion in the coming three years!
Here’s a given all eCommerce brands should prepare for — AI and machine learning will revolutionize how customers approach online shopping in the coming years. It will be, therefore, wise to drop everything and focus on building a solid foundation for an eCommerce store. The foundation, when strengthened for AI-related applications, will help make future third-party integrations easier and more efficient. Only then can we make the most of customer data collection and deliver better customer experiences, apply innovative eCommerce solutions, and leverage other distinctive uses of AI in eCommerce. Did you find this post helpful? Let us know in the comments. Also, don’t forget to check out other informative posts on the blog!