The Role of AI in E-commerce

by Samiksha S. Author

All of you know about Amazon, right? It is one of the most popular e-commerce platforms we have in current times. One of the major success stories of the Amazon e-commerce platform pertains to product upselling and cross-selling, which forms 35 percent of the overall revenues. And the technology that is driving this conversion mode is our topic of discussion for today, i.e., Artificial Intelligence – the dominant force driving the product recommendation tech of Amazon.

Aside from product recommendations, artificial intelligence in the e-commerce industry is also being leveraged by online retailers to offer chatbot services, analyze customer comments, and offer customized services to shoppers. In fact, studies have found that one in every five consumers are eager to buy services or goods from chatbots, while 40 percent of the shoppers love the shopping deals and great offers they receive from the chatbots. With the global e-commerce sales expected to go over $4.8 billion by the year 2021, Gartner predicts that AI technologies will manage more than 80 percent of all customer interactions in the coming years.

So, what role does artificial intelligence play in the world of ecommerce and online retail? Today, we, at JobsAcademy, will take a closer look at the crucial applications of artificial intelligence in e-commerce in this article and will also have a glance at a few industry examples with respect to the same.

The support of digital assistants to the online shoppers

Ecommerce retailers are increasingly embracing digital assistants or chatbots to offer 24×7 support to shoppers. In fact, chatbots are projected to drive e-commerce transactions worth $122 billion by 2023. Leveraging the best of artificial intelligence, chatbots are becoming more intuitive and ensuring an improved customer experience. And the good news is that 25 percent of consumers are open to talking to a chatbot, as long as it leads them to their desired outcome.

In addition to offering efficient customer support, chatbots are improving the impact of artificial intelligence in e-commerce through capabilities like:

Natural language processing that is able to interpret voice-based interactions with the consumers
Meeting consumer needs through in-depth insights
Self-learning abilities to help in improving over time
Deliver targeted or personalized offers to the customers

Intelligent product recommendations that get the job done

Among the main applications of artificial intelligence in e-commerce, personalized product recommendations for shoppers are raising the conversion rates by at least 915 percent and average order values by 3 percent. With the usage of big data, artificial intelligence in e-commerce is influencing customer choices due to its knowledge of searched products, previous purchases, and online browsing habits.

Also, product recommendations offer multiple benefits for e-commerce retailers, including:

Enhanced customer sales and retention
A high number of repeat customers
Enabling a personalized business email campaign
Offering personalized shopping experience to shoppers

Artificial intelligence personalization in e-commerce

Source – https://www.bloomreach.com/

Ranked among the most efficient modes, personalization stays at the core of artificial intelligence in e-commerce marketing. Depending on particular data derived from every online user, artificial intelligence and machine learning in e-commerce works by gathering crucial user insights from the customer data generated. And to that end, it has been found that personalized videos for Call-To-Actions (CTA) have helped to increase the Click-Through Rates (CTR) by almost 202 percent.

For example, the artificial intelligence-enabled tools are able to analyze customer data from several touchpoints (comprising websites, email campaigns, and mobile apps) to notice how they’re carrying out online interactions.

The insights let e-commerce retailers offer suitable product recommendations and extend a reliable user experience on all devices.

Efficient inventory management to fulfill market demand

Efficiency in inventory management is about maintaining the proper inventory level to fulfill market demand without adding to the idle stock. Though the conventional forms of inventory management stayed limited to the present stock levels, artificial intelligence based inventory management is helping to maintain the stocks depending on data related to:

Sales trend in the earlier years
Anticipated or projected changes in product demand
Probable supply-related issues can impact inventory levels

On top of inventory management, AI facilitates warehouse management through the emergence of automated robots that are being projected as the future of artificial intelligence in e-commerce. Unlike human employees, artificial intelligence robots can help store or retrieve stocks anytime, along with timely dispatching of the ordered items after an online order.

Along with affecting the e-commerce industry in more ways than one, artificial intelligence in the B2B e-commerce sector is leading a host of innovative solutions as well. So now, let us take a look at some of the industry case studies where artificial intelligence has come to the aid of e-commerce businesses.

Innovative AI-led solutions benefitting the e-commerce industry

AI led technologies are introducing shoppers to a wide range of products that they did not even know exist in the market. With the help of artificial intelligence, companies are now able to recommend new products to digital shoppers depending on personal data insights and buying patterns.

For instance, led by the success of the Amazon Alexa device, many e-commerce giants are now introducing voice shopping features that let customers review the best of their daily deals on Amazon and place online shopping orders with simply their voice. Furthermore, many e-commerce sites also support voice-enabled features to offer wardrobe tips to the customers, like a comparison between the outfits that would look good on someone and the best fashion combinations.

This has enabled the fashion e-commerce industry to lower the number of returned goods bought through online sales. For example, Zara, the fashion brand, uses artificial intelligence capabilities to suggest the right apparel size depending on the shopper’s measurement and the best match designs based on their style preferences. The feature has been helping fashion brands improve repeat purchases and reduce product returns.

Source – https://itchronicles.com/

Apart from the innovations, AI-powered solutions are changing the e-commerce industry in the given areas as well:

AI-led email marketing sends out marketing emails for services or products that the recipient is interested in. Aside from reading more like human than automated, the email marketing tools offer an intelligent user analysis depending on their response and are better aligned to individual customer requirements.
Supply chain automation led by artificial intelligence enables effective management of the supply chain for e-commerce platforms. Also, other benefits involve helping business decisions related to delivery schedules, market needs, and vendors.
AI-based data analytics tools for the e-commerce sector offer a host of benefits like easy customer profiling, robust business intelligence, and efficient online sale analysis.
Multichannel artificial intelligence solutions enable a seamless and consistent customer experience across brick-and-mortar and online retail stores. For example, artificial intelligence led multichannel solutions from a top brand like Sephora are using a combination of machine learning and artificial intelligence, computer vision, and natural language processing for reducing the gap between online and in-store customer experiences.

As you can see, AI has got a strong place for itself in the business world and is definitely here to stay for a pretty long time! As such, those who get along with the trend now and jet off for learning the nuances of AI can expect to receive high professional demand. At JobsAcademy, a leading training institute for learning AI & Advanced Machine Learning, we offer you the training and mentorship under the top industry experts to ensure that you have a major role to play in the AI-based job of your dreams.

As a part of our 3-months AI training, you get both the options of self-learning and instructor-led mode to choose from. To add to that, we offer lifetime placement assistance and ensure that you can put your skills to test in a top-notch organization. So, if artificial intelligence is your chosen field of work, we, at JobsAcademy, are right here to show you the way!