How can artificial intelligence improve e-commerce?
Companies are increasingly interested in using AI-powered tools in e-commerce because they help them understand customer needs with greater accuracy and choose the right offers for them. AI also enhances the shopping and customer service experience and makes it easier for users to find what they are looking for quickly and accurately.
The role of artificial intelligence in improving e-commerce:
Here are the top ways AI can improve e-commerce:
1- Artificial intelligence boosts sales:
In a customer experience report published by Salesforce Research, which included more than 6,700 respondents, 76% of them expect companies to understand their needs and expectations.
What e-commerce customers are looking for is convenience and customization, and given the ability of the latest AI technologies to personalize the shopping experience, e-commerce companies are seeking to include AI in their work to attract and retain customers.
An effective AI-powered marketing strategy can deliver what the customer wants and needs at the right time, meaning that AI is not only able to know what customers want, but also helps predict their desires.
Another advantage that AI offers to online retailers is helping them maintain long-term relationships with customers. AI increases customer loyalty to the company due to the unique experience they get while shopping.
2- Machine learning systems can predict what customers want:
E-commerce is where the potential of machine learning is most evident; by observing recurring patterns in customer behavior, the technical systems used by e-commerce companies can accurately determine the interests of their target audience now and in the future.
Machine learning can be applied in e-commerce with the following steps:
- Collect different scenarios about customer behavior.
- Processing information and identifying patterns in customer behavior.
- Improve analysis algorithms and predictive capabilities.
By collecting and processing data about the customer experience, AI can generate individual recommendations and special offers in real time, and as a result, offers come to customers at the time when they are most interested in buying.
3- Artificial intelligence increases customers’ desire to buy more:
When shopping for a new suit or dress, for example, a customer may wonder whether the shoes or accessories they already own will match the new piece, and even though they only need one thing, they decide to make additional purchases. This is known as the Diderot effect.
In e-commerce, Diderot's impact can be greatly amplified by using artificial intelligence. AI-powered tools can recognize and analyze customer behavior patterns on a shopping site, and make product suggestions that match the product they want to buy.
Some of the most common patterns that AI can detect and address include:
- Items that a user clicks on, stars, or adds to their cart.
- Products that the user skips.
- The time a user spends on a page displaying product information and images.
- Products stored in the user's order history.
By analyzing this information, AI helps e-commerce website owners accurately guess buyers' interests and display the right products for them.
4- Helps in personalizing offers and shopping experience:
According to a Deloitte report , people are willing to pay 20% more for a personalized product or offer, which shows the importance of providing personalized offers to customers according to their desires. By leveraging AI tools, online retailers can increase the variety of offers provided to customers and personalize them.
AI and machine learning-based systems can provide many personalization possibilities, such as:
- Customizing descriptions : This means customizing the texts that describe the products and adapting them to the needs of the potential buyer.
- Create customized offers : This means creating individual offers for different groups of your target audience that suit their specific desires.
- Email Newsletter Personalization : Customize email newsletter content according to customer interests.
- Processing customer reviews : Analyzing customer reviews to identify products in high demand.
- Providing advice and guidance : Providing advice and solving customers’ problems in a timely manner, and talking to them online directly on the website through chat programs or voice assistants.
The most prominent applications of artificial intelligence in e-commerce:
Below we will mention the 3 most prominent applications of artificial intelligence in the field of e-commerce:
1- Search using images:
AI-powered image search helps you find products that you may not know the name of or how to describe. For example, you may like a pair of pants with a unique design and you saw a picture of it online. You can save the image and then upload it to a shopping site that supports image search. You will see search results that include similar products. Because this search method makes it easier for customers to quickly get the right results for them, many e-commerce sites have added this feature.
2- Communicating with customers via chatbots:
Most e-commerce sites use chatbots and AI-based virtual assistants to provide round-the-clock support and instantly answer customer queries. These chatbots with machine learning capabilities can continuously learn from customer queries, making them more accurate over time in responding to their inquiries. Chatbots can also interpret voice messages through natural language processing.
3- Predicting trends and monitoring prices:
AI is used to predict fashion trends by monitoring social media and digital press. Merchants who use AI to predict fashion trends can identify in-demand product categories and form effective marketing strategies.
AI algorithms also help analyze prices set by competitors and predict price changes, and based on the results, AI recommends the ideal price to maximize profits.