How Artificial Intelligence (AI) can Boost Your eCommerce Sales
Wondering what is driving the bottom line at e-commerce giants like Amazon? Yes, they indeed have a robust IT infrastructure, a strong work culture, and a great leader at the helm. Still, with cut-throat prices, escalating warehouses, spiraling cost of maintaining infrastructure, and the cost of human resources, you need something more to stand out from the crowd. Yes, AI is the buzzword for e-commerce giants like Amazon, who are doing exceptionally well in the markets they operate.
One of the biggest success stories at Amazon is cross-selling and product upselling. According to a report by marketing guru Neil Patel, the first introduction of their upselling feature increased Amazon’s revenue by 35% which is nothing short of spectacular!
So how is AI helping e-commerce giants to improve on their bottom line? There is more to AI in the e-retailing business than product recommendations. The sections that follow will throw some light on the various domains within e-commerce that AI is contributing to positively.
Artificial Intelligence is an evolving domain and will see a lot of interesting applications in the future. But for now, there are at least six proven applications of AI that you can use to boost your online retail sales.
It is mostly about running the business efficiently by identifying excesses, running on optimum inventory, and upselling.
Chatbots in E-commerce
Chatbots are the future sales workforce of the online retail industry. With groundbreaking innovations in Natural Language Processing and Machine Learning, chatbots are teaching themselves every day the essential skill of making a sale. Chatbots were primarily introduced to offer support services but, over the period, have been trained to upsell too. Chatbots provide a well-rounded customer experience, just as you would expect a regular support executive on the phone. Chatbots have also reduced costs. How? Well, you would no longer need to employ as many support staff as before. You are relieved of all the expenses that come with hiring people. You could even outsource the voice-based support to a competitive business services provider.
With AI involved, shall we change that to intelligent product recommendations? According to Smart Insights, large e-commerce businesses have seen a considerable jump in conversion rates as recently as 2021. AI provides a sensible product recommendation and combines it with user purchase data and other relevant inputs to present a more personalized recommendation.
You as a retailer can enjoy the below-listed benefits with an AI-powered recommendation engine. The personalised shopping experience, customer loyalty, customer retention.
With AI, the more data available, the merrier. AI uses data from almost all touchpoints the customer has been active on. Data from mobile apps, search history, local shopping trends, including environmental conditions are all brought together to offer a very personalised experience to the customer without being too invasive obviously.
For example, an AI-enabled tool, Boomtrain, processes customer data from multiple touchpoints to create a digital picture of the customer and appropriate recommendations.
AI-powered Inventory Management
Inventory management is one of the pillars of any product-based business. Efficient inventory management requires you to keep just the right quantity and avoid storage and logistics issues. Also, the location of the warehouse is an essential factor as well. An AI-powered inventory management system will work wonders for your business with all the order destination and logistics data. With the AI system learning from every order, from every region, from every hub and logistics provider, you get to have the most optimum inventory system given the circumstances. AI in inventory management systems also brings in sales data, projected sales, and any potential logistics or supply-related issues affecting inventory levels.
Also associated with inventory is the cost of labor in warehouses and having to contend with any potential errors. AI-powered robots at the warehouses perform all warehouse related tasks 24X7 with hardly any error.
AI-powered user experience
You can improve user experience on your e-commerce site many times over with new AI-powered features like product search using an uploaded image or ordering online using a voice assistant like Alexa.
Artificial Intelligence the ultimate problem solver
Machine Learning-based systems are being used to solve complex problems, sometimes native to the population or particular country. In a vast country like ours, you are bound to get delivery addresses that are vague and ambiguous. AI-powered systems can ensure the address provided is a valid one and can be delivered in the timelines.
This alone reduces related problems like delays, rerouting, and returns that affect the logistics cost and customer experience.
Artificial Intelligence in logistics
An AI-assisted address classification system that ensures deliveries are scheduled in such a way as to minimise transportation costs.
Fraud or malpractice detection using AI
You can also develop proprietary AI software to detect frauds and malpractices in your business to minimise pilferage or a parallel market.
AI-powered fashion retail.
Traditional online fashion retailing had to bear huge costs on products shipped for trial and return of rejected products. Artificial Intelligence-powered user interfaces help the customer order just the right size. Customers can now try the products in a virtual environment and place the order. This reduces overhead costs of shipping items for trial and collecting back returned items. With less movement of goods, the chances of an adverse event impacting the customer experience also eliminated.
An AI-powered eCommerce site can do more for you like AI-based email marketing, AI-powered Supply Chain automation, AI-powered Omnichannel solutions.
The possibilities with AI in e-commerce seem endless if you see it as worthy of investing in. If you think you have it to design and develop an AI-powered system or improve an existing one further but lack the specific AI skills, you have GreatLearning to the rescue. You can earn an artificial intelligence certificate online by pursuing an online artificial intelligence course.