Over the past few years, retail has been actively seeking and introducing tools and technologies that help to understand customers better. Digital transformation is not only changing the business models of companies, but also affecting consumer behavior.
They react to spam spreading extremely negatively and wait for more personalized offers at the same time. People are becoming more demanding on the service level, and this fact encourages retailers to use innovative technologies, including artificial intelligence.
Maxim Khramenkov, Innodata’s project manager, told New Retail about the way AI helps stores increase demand and revenue, and foster loyalty to food brands. Nix Solutions translated the article so that you can find out which technologies are used in online retail today.
Internet trading is one of the leading areas in retail where AI technologies are used.
In online trading, all user interaction is somehow digitized. A person makes orders, pays for them in applications or on company websites, in online stores, where they receive additional information about goods and services, view ads, click on links, leaving their unique digital footprint. This helps companies collect customer data throughout the customer journey. Subsequently, the collected information is used to train analytic models.
Why are such models needed? For example, they can help fine-tune targeted marketing campaigns. When setting up advertising, all possible factors are taken into account: clients’ gender and age, their interests and needs, the most acceptable communication format, etc. This information helps artificial intelligence customize the trading offers for each client. For example, show suitable advertising banners, offer products that may be of interest to the buyer based on their previous experience and so on.
Computer vision and augmented reality
During 2020, 30% of retailers are projected to use computer vision technology in their stores, which will help optimize many business operations. This technology can be integrated with video surveillance systems in offline stores, which will help control security: track unscrupulous customers and prevent theft. In addition, computer vision is often used to control shelf occupancy, form effective marketing campaigns and increase sales.
In online retail, computer vision performs slightly different functions. For example, large online markets use this technology widely to search for products from photographs. A largest international company, AliExpress uses computer vision to help customers find products of interest on their online platforms. The technology allows you to recognize images and find similar ones on a site or in a mobile application. For example, a person does not know the name of the product inside the online market. He or she takes a photo, and the AI offers a list of similar products among which the client finds what the needed one.
The clothing industry is actively using the AR technology. In the application, the buyer can see how much the thing they like suits them and evaluate whether it will combine with other elements of clothing to select the right image. Now this technology is being tested and implemented by major online services like ASOS.
The organization of internal processes in companies
Artificial intelligence is used not only for the convenience of customers: it also helps online shopping in the organization of internal business processes, for example, in optimization of logistics and warehouse operation. The most striking example is Amazon. The company makes extensive use of robots for sorting orders minimizing manual work in warehouses.
AI can also be used in contact centers of online stores. Chat bots and virtual assistants make it possible to digitize the process of communication between the contact center and the customer, reducing the path information to a virtually instantaneous.
We see that AI is gradually entering the retail industry, helping companies to establish personalized contacts with customers and optimize their work from the inside. It is too early to talk about the absolute perfection of such technologies, as many of them are only tested and applied selectively in companies.
However, increased competition in the market will push retailers to accelerate the development of artificial intelligence and search for the possibilities of its application in various business processes.