Even before the pandemic, eCommerce made massive progress in recent years. But with work-from-home and the concept of social distancing, online shopping emerged as a lifesaver in a very literal sense. Ecommerce is snowballing, and AI is poised to accelerate the growth of ecommerce further.
In 2020, global eCommerce amounted to a staggering $4 trillion and is still going strong.
Here is how AI is transforming eCommerce.
AI-Controlled Supply Chain
AI for eCommerce is now ubiquitous. Artificial Intelligence is making its presence felt in all business sectors and at all supply chain stages.
Ecommerce retail giant Amazon is leveraging AI not just on its website but also in its mega warehouses. Robots work alongside humans at Amazon storage sites. Amazon plans to fully automate its warehouse operations in about ten years. AI for eCommerce will be central to this lofty ambition. The bulk of labor at Amazon and other eCommerce facilities will be AI-controlled soon.
AI-Based Recommendations
Amazon customers are well aware of AI-powered recommendations that keep showing up to induce them to spend more. Based on these AI-based recommendations, customers feel compelled to buy more. Hence, AI for eCommerce helping to boost sales for all sorts on online retail sites, including Amazon.
AI-Based Cyber Security
Behind the scenes, AI is also playing a key role. Online security has become a major concern. Customers are worried that their critical personal data will get stolen. Brands are concerned that online breaches and attacks will erode customer trust and tarnish their brand image.
To counter this, eCommerce platforms are using AI to fight cybercrime. Ecommerce giant Amazon is using AI to protect the accounts of its sellers. Hence, eCommerce is striving to bolster online security by implementing robust AI solutions.
AI-Powered Online Ads
Competition for online ads is intensifying. Thus, savvy entrepreneurs turn to AI for more effective online ads that are better at targeting prospects and leads.
Cutting-edge AI software analyzes user browsing history to identify their interests and preferences. Based on this, the most relevant ads are shown that correspond to what users want.
Personalization is paramount for more effective targeting. Doing this manually would be onerous, precise, and simply impossible due to the sheer size of customer numbers. Not only can AI automate this critical task, but it can also do it better than human beings. Personalization has become a reality thanks to AI. This is empowering eCommerce platforms to show more relevant ads that have a better conversion rate.
Voice Search
Voice search is proving to be a very convenient way for busy shoppers to buy quickly and effortlessly. Smart speakers are now widespread, and it is estimated that around a quarter of US adults own one.
And just about everyone these days has smart phones. This has further boosted the appeal of voice search since typing on these gadgets is a hassle. Users now want voice search to complete their queries quickly and easily.
The realm of eCommerce must take note of how voice search is revolutionizing online shopping. Ecommerce brands should have AI-based tools for answering voice queries accurately and quickly.
The AI-based Amazon Alexa is a powerful tool that empowers shoppers to issue voice commands for a satisfying shopping experience quickly.
Intelligent Chatbots
Virtual assistants or intelligent chatbots are providing automated customer service. For big brands, high-quality customer service has always been a challenge. Innumerable customers must be served, and every additional human agent is a major source of added cost.
AI-powered technology in the shape of smart bots is resolving this key facet of eCommerce. Although not perfect, AI-based customer service is steadily improving. Basic queries can be handled satisfactorily by virtual assistants. Soon, virtual agents will also be handling more advanced queries for good results.
Better Customer Retention
Customer retention is crucial for eCommerce. Acquiring new customers entails considerable costs. Hence customer retention is vital for a good profit margin. This key aspect of the business is particularly vital for eCommerce, where switching sites are just one click away.
One way to improve customer retention is to utilize omnichannel personalization solutions. According to McKinsey, such an approach can bring about 10 to 15 percent improvement in customer retention rates. Such AI-based systems work by recognizing patterns and gaining insights from customer data pulled from multiple channels. The report asserts that such personalization methods will soon prove to be more effective than traditional marketing techniques. Hence, AI is at the forefront of customer retention as well.
Greater Automation
AI can drive greater automation. Instead of expending precious time, energy, and resources on repetitive tasks, entrepreneurs can deploy AI solutions to handle such mundane processes. This will leave them free to consider strategic aspects of the business that can bring value and drive growth.
AI solutions reduce human intervention, thereby freeing up staff for more important work. These solutions are now being used for hiring, marketing, scheduling emails, and just about any other eCommerce aspect that comes to mind.
AI solutions can improve inventory management; for instance, eCommerce platforms with thousands of products on offer can benefit from these tools. Whenever stocks fall to critical levels, these tools can send an alert to vendors. Hence, AI tools are extremely useful for tracking numerous products while minimizing human intervention.
Better Sales Performance
Abandoned carts are the bane of eCommerce. A huge chunk of sales is lost to abandoned carts. Hence, it is necessary to follow such customers via email to get them back.
AI software can automate sending emails to customers who abandon carts. This automated function is vital since it is not feasible for human staff to follow many customers each day. AI can thus help eCommerce brands minimize lost sales.
Bottom Line
Targeted ads, user recommendations, chatbots, automated cybersecurity, AI boosts revenue in more than one way. In fact, the time is not too far off when AI for eCommerce will dominate all avenues through which online platforms earn their revenue.
