How Is AI Making Its Way In The eCommerce Industry?
Artificial Intelligence (AI) has become the talk of the town for the last couple of years. It is ruling in almost all areas where eCommerce is no exception. AI has exposed the true potential of the eCommerce industry and has opened up many opportunities to generate new businesses.
With global eCommerce sales reaching $4.88 trillion by the end of 2021, it is evident that the sector is expanding at a fast pace. And with the advent of artificial intelligence, it can go even further.
And according to a development stat, by 2023, most organizations utilizing AI for eCommerce will accomplish around 25% improvement in revenue, customer satisfaction, and cost reduction.
Aren’t these stats & facts surprising? By looking at these stats, I can say that AI can be a true game-changer in the eCommerce business. With the quickest progression of technological boost, AI is quickly revolutionizing the eCommerce business.
Want to know how? Then follow this blog until the end to understand how AI is bridging a significant change in the eCommerce industry today. Let's get started!
What is AI in the eCommerce Industry?
Did you know? The adoption of AI in eCommerce can increase business productivity by 40%? As a result, many eCommerce businesses all over the world are making use of AI to accomplish complex tasks.
AI enables businesses to predict, understand and automate. And this results in improving user experience and enhanced brand reputation.
From Alexa to Google's home appliances and chatbots, AI has already been a part of our lives. AI in eCommerce has improved the entire online shopping & selling experience and can solve real-world issues that ecommerce businesses are facing.
If you have still not used this state-of-the-art innovation, you can opt to hire ai developers to add this technology curve to your business.
How is Artificial Intelligence changing the eCommerce Industry?
While there are multiple advantages of artificial intelligence in eCommerce, here are some of the AI applications in eCommerce that are benefiting the online eCommerce stores. Take an in-depth look:
Improved & Flexible Visual Search
Did you know? About 74% of the users get irritated with websites when they find irrelevant content. If the search function of a brand is not correct, it will disappoint the customer. Later, it increases the bounce rate and initial site abandonment.
To manage this error, AI has started to utilize natural language processing (NLP)(NLP) to mitigate the problem and the most relevant search items for online customers.
Artificial Intelligence in eCommerce has drastically improved visual search capacities to discover and match items near to your search.
It is an AI-driven technology that enables users to find what they want with just one click. Visual search reads images to see colors, shapes, proportions, and shapes, even text to identify product names and brands.
For example: if you are searching for something precisely what your companion purchased? All you have to do is click an image, upload it and let the AI discover it for you! Isn't this amazing?
Visual intelligence has significantly improved technologies to provide a fantastic customer experience. The smart insights study report states that 33% of individuals have utilized or performed the visual search.
While 36% of individuals express, visual search is more applicable and gives better search results over voice shopping. Visual search provides a relevant way for users to look for products in-depth with the assistance of AI in eCommerce.
Voice Assistance Into Action
Have you ever thought of a voice-driven personal shopping assistant? As AI is advancing, many new technologies are emerging in the ecommerce industry for better customer experience.
Voice assistance is the most prominent among them and is taking the world by storm. It makes use of AI to look for products or services by taking the help of speech.
With Apple's Siri, Amazon's Alexa, and Google Assistant, shopping for your favorite content is only a voice command away. And Artificial Intelligence Fed Voice Assistant has sculpted a niche by empowering users to control things.
Voice commerce sales are expected to reach $40 billion by 2022. While the timing for such functionality is still experimental, brands are looking for ways to exploit it.
Here are some of the facts that clarify why voice shopping is a massive thing in eCommerce:
62% of users use the voice assistant to purchase products through voice commerce.
85% of consumers stated that when they have gone with the top product recommendation of a virtual assistant instead of a specific brand, they are probably ready to purchase.
30% of US Internet users use voice assistants to purchase products and see product information.
If you are an entrepreneur and want to gain success in the competition, take a step forward and plan to cover all the essential AI applications in eCommerce.
AI Personalization in eCommerce
Artificial Intelligence in eCommerce offers a personalized shopping experience to users. Based on the data collected from every user, AI in eCommerce is gaining vital user insights from the triggered consumer data.
Organizations can now view their customers' preferences in real-time and give them a reliable and exclusive shopping experience because of AI-enabled systems.
For example, Boomtrain - an AI-enabled tool, can analyze customer data from multiple touchpoints to see how they interact online.
And all these insights allow eCommerce retailers to make appropriate product recommendations and offer a consistent user experience.
Proficient Inventory Management
Systematic Inventory management is about maintaining the right inventory level that can fulfill market needs without adding futile stocks.
Here’s a stat that shows the same scenario. Approximately $ 1.1 trillion of capital is trapped in inventory, equivalent to 7% of US GDP. The figures do not end here. About 45% of small and medium-sized businesses either do not keep track of their inventory or manage it manually.
It’s a vital factor shaping the overall development of the e-store as well as its success. AI can tackle inventory challenges through a highly automated process. For instance- it will start creating purchase orders for goods that have high demand.
While the traditional type of inventory management was limited to existing stock levels, AI-empowered stock administration is empowering how to keep up stocks dependent on related information:
1. Estimated or expected change in item demand
2. Sales trends in earlier years
3. Potential supply-related problems that may influence stock levels
Other than inventory management, Artificial Intelligence is empowering warehouse management with the rise of automated robots, which is being promoted as the future of AI in eCommerce.
In contrast to human representatives, AI robots can be utilized for immediate dispatch of requested products and store or retrieve 24×7 stock after online orders.
AI is bringing a change in the eCommerce industry in many ways and driving many new solutions in the B2B eCommerce sector.
Chatbots and Other Virtual Assistants
According to Gartner, 25% of customer service operations have become automated using chatbots or virtual assistants in 2020.
Chatbots are programs that take frequently asked questions and provide you with the information you need.
Businesses are now turning to chatbots or virtual assistants to offer round-the-clock support to their online buyers. Powered by Artificial Intelligence technology, chatbots are becoming more intuitive and offer a better user experience.
In addition to providing excellent user support, chatbots are increasing the influence of AI in eCommerce through the following abilities:
1. Meeting customer needs via in-depth insights.
2. NLP (Natural language processing) can explain voice-based interactions with customers.
3. Self-learning abilities that help them improve with time.
4. Give personalized offers to consumers.
Intelligent Product Recommendations
ECommerce companies widely practice product recommendations to help their customers find what they are looking for. Customers often indicate what they are looking for or what they like.
And eCommerce websites recommend products to their users based on their activities and previous purchases on the website.
Now, AI can smartly analyze these signals and identify each customer's preferences to determine which category they prefer, which brands they follow, and their comfortable rates.
With this degree of personalization, an eCommerce store can get more deal openings and give a customized shopping experience.
Use case: The coffee company Starbuck showed how it is accomplished. The organization implemented AI to analyze information gathered from consumers to provide them with better proposals.
The organization has incorporated AI into a virtual assistant that empowers consumers to put orders with voice orders.
The algorithm depends on an assortment of information sources, for example, account data, user inclinations, purchase history, context-oriented data, and third-party insights.
ECommerce retailers generally utilize the recommendation functionality to help users find the best item. Amazon, eBay, Netflix, and numerous others are currently using this AI-based recommendation feature.
AI fundamentally empowers Amazon's product recommendation innovation. A stirring 35% of its total revenue on the Amazon eCommerce platform is one of the great success stories of this retailer.
Automated Pricing Management
As an online retailer, besides taking care of catalogs, inventories, and customer purchasing preferences, you should also know the best prices for your products.
Because of AI, eCommerce organizations can now give them the minute details that assist them in improving their business operations.
So, with AI in eCommerce, you have analytics software for price investigation that uses a fixed factual model, ML, and numerous other AI models to construct algorithms that automatically recognize pricing patterns from the information and predict costs dependent on that data.
The automated AI pricing solutions in eCommerce can help diminish manual work in relation to tracking your competitors' prices. Hence, in this manner, organizations can decide item costs dependent on information from both inner and outer sources.
Cybersecurity
Did you know that in 2018, approximately 60 million Americans were affected by identity theft?
Breaking through cybersecurity and stealing valuable user information is nothing new. And, earlier organizations used to take 100 to 200 days to identify or distinguish an infringement.
As eCommerce is a platform that stores users' crucial data, cybercriminals consistently search for approaches to take that information. AI algorithms have emerged to reduce the possibility of fraudulent activities and thus preventing unauthorized access.
And this empowers a website for taking real-time decision making along with risk scoring. And, it does this by identifying even subtle patterns that are hard for people to distinguish.
As it facilitates a persistent learning cycle, the software analyzes transactions to guarantee that the authorized individual is shopping or transacting on the site.
Cybersecurity experts are not entirely convinced to put back AI to handle cybersecurity, but AI is still growing its roots in cybersecurity. Here are some examples where AI is helping in cybersecurity:
1. AI can detect potential vulnerabilities, bugs, and security flaws. For instance, AI can be utilized to identify when untrusted information has been sent from an application.
2. AI is being used to update the security database. It can analyze logs from different sources and can identify when new dangers are unavoidable. It can likewise recognize malware and spyware trends by examining information across various channels.
3. AI can detect any abnormal activity. It can detect malware movements on a large scale. It might use specific parameters to help decide if it is a danger signal or just a false alarm.
Automation in Warehouse
Warehouse automation has been a requirement in ecommerce in recent years. Functionalities such as the same or next-day delivery have become a typical customer expectation that has substantially affected warehouse automation.
In eCommerce, request volumes are expanding, SKU numbers are also growing. On the other hand, the turn-around-time and order size is diminishing.
To satisfy a vast need, warehouses are ending the conventional practice of clipboard-bearing, forklift, and stock administrators. Instead, they are being powered by AI-based intelligent robots, which sell stock items 24×7 and continue to operate without a break.
And these AI-based intelligent robots talk to their warehouse management software. At the point when a user submits an order request, the data is sent to the respective warehouse software.
After that, the software establishes communication with the robot, and afterward, the robot is sent to take the purchased items out of stock, box them, and get them ready for shipment.
Here are the other various benefits of warehouse automation:
1. Fast stocking and retrieval
2. Better accuracy
3. A few chances of stock damage
4. Eliminates potential hazards of human injuries in the warehouse
5. Results in lower labor expense
Overall, automated warehouse software products disrupt the warehouse industry. But it is instead a piece of good news for the eCommerce business owner.
Creates More Efficient Sales Process
Gone are the days when we used to pick potential customers through cold-calling. Old sales techniques are becoming obsolete day by day. Now customers are inspired by many different mediums, from TV commercials to social media.
A sales campaign is considered successful when it delivers conversions. On the other hand, there is no way to find out if a message is arriving at a suitable customer base at the right time and on the right platform.
And it has been happening with online businesses for so long. But AI can change it completely.
The integration of AI's natural language learning and voice input abilities into your CRM permits the system to address users' questions, tackle their issues, and even discover sales opportunities for the sales team.
North Face, the largest e-commerce retailer, has set a great example of an AI-enabled store that teaches customers about their choice of jackets by asking them a few questions and then showing them great product results.
Wrapping Up
Artificial intelligence provides a lot of benefits and has the power to revolutionize the eCommerce industry today. It will change the world of eCommerce and will undoubtedly improve the way customers find and buy products online.
If you need your eCommerce site to flourish, you need more than a website or mobile app. You need modern technology like Artificial Intelligence. Therefore, given the widespread and beneficial impact of AI in the eCommerce industry, you should integrate this technology into your e-store.
If you need an AI eCommerce platform, reach out to a top eCommerce development company in India, who are well versed with AI technology and have expertise in providing custom solutions to customers around the world.
Good Luck!