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Here’s how AI is revolutionizing ecommerce

If you’ve even been near a computer recently, you’ve probably heard something about the artificial intelligence (AI) revolution. Depending on who you believe, you might soon defer to a robot lawyer and get news from robot journalists. And while those things seem a bit far off, AI is already changing the ways we think about ecommerce by helping brands reach out to customers in increasingly personalized ways.

AI has fascinated the human imagination for centuries, and been a part of the lexicon since the term was coined in the 1950’s. According to ClickZ’s Nico Bibb, AI has three distinct stages:

  • Artificial Intelligence. (1950’s). Defined as a program that can sense, reason, act and adapt.
  • Machine Learning. (1980’s). Computers begin to learn without being programmed. A single algorithm learns from past experiences and data fed to it by humans.
  • Deep Learning. (2010). Machines start to mimic the way in which the human brain works. AI systems that can be trained to predict outputs given a set of inputs.

The last stage of AI’s evolution, deep learning, is what makes AI invaluable for ecommerce. Machine learning that can not only analyze customer data but use that data to anticipate customer needs in order to create personalized experiences is a game changer as ecommerce companies struggle to keep up with customers who demand personalization across devices. Here are a few ways that AI in ecommerce is revolutionizing the ways we interact with our audience.

AI is battling the abandoned cart

Ecommerce is excellent for browsing, but it can be difficult to get customers to stop deliberating and actually buy something. In fact, it’s estimated that upwards of 70% of online shopping carts are abandoned before customers complete their purchases. For clothing retailers, it’s even more difficult to get customers to commit to a purchase, since most prefer to hit a brick-and-mortar location and speak to a sales associate, or better yet, bring along a friend for a second opinion, before they buy.

Recently, outdoor wear company, The North Face, partnered with IBM to better personalize their customer experience, incorporating AI into its online shopping app. IBM’s Watson creates a psychoanalytic profile of customer data in less than a second, and from there, asks questions about where, when, and for what activities customers will be using their apparel. Next, the AI provides personalized suggestions ranked from “High Match” to “Low Match,” saving customers the hassle of scrolling through hundreds of images and then second guessing whether the purchase will be right.

So, does it work? Early data points to yes. According to IBM, customers spent an average of two minutes with the AI, not to mention 60% click through rate for product recommendations. Using AI for personalization in ecommerce could solve a huge problem for retailers: the runaway customer.

Visual search is changing the way we browse

Using AI in ecommerce for personalized product recommendations goes a long way towards helping bridge the gap between working with a sales associate in a store and scrolling through a website solo. But perhaps one of the best things about brick-and-mortar shopping is being able to browse the aisles searching similar products until something truly perfect pops out.

AI is helping ecommerce companies like eBay, Target, and social media giant Pinterest take the guesswork out of online shopping by simplifying the search process. Recently, Pinterest reported that 93% of its users use the site to plan purchases, so the company recently used AI to create searchable images where users could tap just one part of an image to find product information. Retailer Target has recently partnered with Pinterest to substitute keyword search for image search in its app, so instead of typing “mid-century modern sofa,” users can just upload a photo and let AI technology scour the company’s inventory for a perfect match.

Ebay has recently added similar technology but is upping the ante by allowing users to share images from social media or websites in order to find similar products for auction on the site.

Recent studies show that social media platforms are responsible for 3.2 billion daily visual shares, so it stands to reason that customers want to shop what they share. Visual search is still in its early stages, but AI technology is leading the charge in blurring the lines between online and in-store shopping.

Robots are awesome customer service reps

The last time you called a pharmacy, a robot probably answered the phone. We all know the tells: smooth female voice, preprogrammed questions, and infuriating, mechanical slowness. Most of us have pushed zero over and over in frustration at a robot, hoping to be transferred to a human.

However, in the near future, customers might chat with AI just as easily as they would chat with any customer service reps, and the days of angrily mashing buttons at robots could be over.

For instance, Google recently unveiled Duplex, which uses AI voice technology to have natural conversations with human beings. Over the course of the demonstration, Duplex called a hair salon and made an appointment with a human receptionist and then made a dinner reservation at a local restaurant. While it’s unclear how Google plans to use the technology, its possibilities for customer relationships are endless. AI never gets sick or has a bad day, and with humanistic robots, um, manning the phones, true 24-hour customer service could soon be possible.  

Of course, back and forth banter with robot customer service reps is just one possibility for the future of AI in ecommerce. But many savvy ecommerce companies are using AI right now to build better relationships with customers by incorporating chatbots into their marketing strategies.

Chatbots, or AI designed to engage in human conversation with users, have come a long way since the Turing test was designed to see if a robot could convince a person that they were having a human interaction.

These days, many brands are using chatbots to simplify the user experience, and whether humans realize it or not, they’re having functional, personalized relationships with robots on the regular. For example, Starbucks has recently introduced a chatbot to it’s “My Barista” app that allows users to order by voice or text, and then uses AI technology to analyze customer order data to provide more accurate recommendations for future orders. So, if a customer loved their unicorn frappuccino, they might just love the next Instagram-worthy drink the brand rolls out.

Chatbots are on the cutting edge of customer service because, as AI technology evolves, chatbots help ease pain points in the ecommerce experience by providing always-on customer service. In fact, consumers actually find chatbots to be 35% better at answering questions than human representatives.

A robot may have written this article

A couple of years back, Gartner predicted that by 2018, 20% of business content would be computer generated. That future is here, and while there are no hard stats that prove whether or not Gartner’s prediction came true, companies are making great strides toward incorporating AI into their content marketing strategies.

For example, when The Washington Post wanted to provide its readers with hyper-local sports coverage, the paper knew it didn’t have the manpower to send reporters to hundreds of games that only mattered to a handful of people. What they had instead was AI technology. An AI program called Heliograph analyzes data around scores, players statistics, and weekly regional rankings then uses that data to write hundreds of sports articles that the Post never could have covered using human reporters.

The potential for AI in ecommerce is boundless, but most ecommerce companies are focused on AI for online shopping. And while chatbots and more accurate, personalized recommendations are exciting, using AI to analyze customer data and language in order to create hyper-personalized content is another revolutionary possibility for AI.

But, even as chatbots begin to take our coffee orders as we shop our Pinned pictures, customers remain wary of AI technology, which may be the biggest roadblock for ecommerce companies looking to integrate AI into their company strategy.

Recently, a story went viral about a bot that was “forced” to watch 1,000 hours of Olive Garden commercials and then asked to write a script for an Olive Garden commercial. The (fake) results were hilarious, with lines like “See the unlimited stick. It is infinite. It is all.”

The story was a hoax, but it clearly illustrates customers’ fear of a future where our content and conversations are controlled by cold, unfeeling bots who suck the humanity out of even a fun trip to the Olive Garden.

However, while the perception of AI as cold and stiff seems to be common among consumers, in reality, AI is helping brands get more personal than ever before. While the technology is still in its early stages, AI that impacts every aspect of a brand’s ecommerce experience, from content creation to customer service, might not be just a fantasy. It could be a future.

The post Here’s how AI is revolutionizing ecommerce appeared first on ClickZ.

Reblogged 4 weeks ago from www.clickz.com

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