In today’s digital world, e-commerce has become an integral part of business to maintain a consistent presence and drive sales. In fact, nearly 80% of total retail sales in the United States now take place on digital platforms. This increasing demand for e-commerce has led to the emergence of Artificial Intelligence (AI) as a game changer for e-commerce businesses that are willing to embrace it. AI is revolutionizing every industry from healthcare to education and there’s no decelerating curve for it either — almost all leading tech companies have announced AI-driven initiatives recently including Microsoft, Facebook, Google, Amazon, etc. In this post we will focus on how artificial intelligence can make your e-commerce business more profitable.
What is Artificial Intelligence?
Artificial intelligence is the implementation of computer systems with the ability to perform tasks that humans can perform. It is made possible by advancements in computer science, and the incorporation of techniques from areas such as psychology, neuroscience, statistics and bioinformatics. Computer systems are designed to learn, store and execute patterns to make predictions and perform actions. AI has been used to enhance marketing and sales processes to help decision-makers make quicker and more effective decisions. Companies are using AI to increase productivity and create new products and services. By analyzing data, AI can automate tasks, process information and make decisions for businesses. AI is also used to improve customer engagement through chatbots, which allow businesses to communicate with customers by using conversational language. Chatbots can be very useful when it comes to managing customer relationships, especially when it comes to dealing with customer inquiries or complaints.
Application of artificial intelligence in e commerce
E-commerce is basically the practice of selling goods or services online. Artificial intelligence can be used to make the buying process more seamless and efficient. A combination of machine learning, natural language processing and computer vision can help retailers and brands improve their in-store experience and make shopping an enjoyable experience. With artificial intelligence implemented in e-commerce, retailers can make their shopping experience more personalized, accurate and efficient. For instance, AI can help detect if a customer is looking for a specific product or not. Once the customer is shown that particular item, the system can tell if he/she wants to purchase it or not. Additionally, AI can also be used to recommend products to customers based on their past purchases and preferences.
Benefits of artificial intelligence in E-commerce
- Automated Decision Making - AI can help businesses automate decision making processes, which will save time and resources for human decision-makers. It can help to make faster, more informed decisions that will improve employee efficiency and productivity.
- Quality Assurance - AI can also help to ensure quality of products. By scanning products in a given inventory, it can catch any product that does not meet quality standards, thus improving the overall product quality.
- Visibility Of Data - The visibility of data is also one of the major advantages that businesses are getting from AI. With the help of artificial intelligence, businesses can now understand their customers’ behavior and make much better predictions of what their customers want.
- Better Customer Engagement - The next reason for why AI can be used in e-commerce is the better customer engagement. With the help of artificial intelligence, retailers can now engage customers on an even deeper level. For example, they can use chatbots to understand customer’s emotions and engage them accordingly.
- Cost Reduction - The final advantage of using artificial intelligence in e-commerce is cost reduction. AI can help businesses achieve savings through savings on personnel, operational costs and time reduction.
Role of AI in E-commerce Businesses
Artificial intelligence can be used to help optimize the performance and efficiency of a business’ IT system, improve marketing campaigns and drive sales. Some of the other key use cases of AI in e-commerce include the following:
- Predictive Modeling: Predictive modeling is a machine learning technique where the AI system learns from the data that it has collected. By knowing the past data about customers and products, AI can make predictions about the same.
- Recommendations: Recommendations are another key use case of AI in e-commerce. A business can use the data about customers to create recommendations for them. These recommendations can be customized depending on the customer’s data, e.g. shopping history and preferences.
- Tracking Of Orders And Inventory: The data about customers and orders can also help AI to track inventory and orders. By knowing the data about orders, a business can track if any of the products are not available or if they have been delivered late.
- Information For Customers: The data about customers can also help AI to provide information about other products or services that the customer might be interested in. For example, AI can use customer data to recommend a hotel booking service to a customer.
Key challenges for E-commerce with AI Implementation
E-commerce businesses are facing difficulties in implementing AI. The reasons are as follows:
- Lack Of Expertise: AI requires special expertise and understanding of computer science. If the team lacks the required skills, then it will be very difficult for them to implement AI in the business.
- Data Quality: The quality of data is another challenge for implementing artificial intelligence in e-commerce businesses. If the data is not accurate, then it will not be possible to make use of it for making any predictions or recommendations.
- Matching Of APIs: The next challenge for implementing AI in e-commerce business is the matching of APIs. The systems that are used in AI require specific APIs to operate. If the business does not have such APIs, then it will not be possible to implement AI in the business.
Artificial intelligence can be used to make the buying process more seamless and efficient. A combination of machine learning, natural language processing and computer vision can help retailers and brands improve their in-store experience and make shopping an enjoyable experience. With artificial intelligence implemented in e-commerce, retailers can make their shopping experience more personalized, accurate and efficient. The benefits of artificial intelligence in e-commerce include cost reduction, automation of decision making and better engagement of customers. It also helps businesses achieve savings through savings on personnel, operational costs and time reduction.