Unless you have been studying this field for many years, otherwise, we may have only heard about artificial intelligence ( AI ) but do not know what AI applications are in Ecommerce.

In this article, we will share some of the amazing and practical ways retail businesses are using AI in the online shopping industry.

AI has penetrated every aspect of our lives. From the increasing presence of self-service checkouts to advanced security screening systems at airports; artificial intelligence is everywhere.

Many predict that the use of AI will increase dramatically in the next few years, for example, tech giants like Google and Microsoft have invested heavily in AI initiatives.

Google's £400m investment in the purchase of AI startup DeepMind , an artificial intelligence company that specialises in algorithms and machine learning for positive impact, is just one of many anticipated acquisitions as the potential of that technology becomes a reality.

Other major tech companies like Facebook, IBM and Yahoo have publicly expressed interest in developing artificial intelligence as a new business line.

When we search for AI, we easily come across hundreds of articles predicting a market dominated by the use of artificial intelligence.

In fact, a recent study by Business Insider found that up to 85% of customer interactions will be managed without humans by 2020.

But how does AI impact? Here are 19 great ways to use AI in Ecommerce.

1. Create customer-centric search

Amir Konigsberg, CEO of Twiggle – creating eCommerce search engines that think like humans. Amir says consumers often abandon eCommerce experiences because the product results they see are often irrelevant.

To solve this problem, Twiggle will use natural language processing to narrow down, contextualize, and ultimately improve search results for online shoppers.

US-based tech startup Clarifai is trying to improve e-commerce search. Clarifai's initial focus was on the visual elements of search, with the company claiming on the Web that the software was 'big vision with artificial intelligence'.

Developers build smarter apps that 'see the world as we do', empowering businesses to develop customer-centric experiences through image processing and video recognition.

Leveraging machine learning, AI software tags, organizes, and searches visual content by labeling features of images and videos.

About the company's Custom Training , which allows for the construction of pre-built models on demand, where AI is taught to understand any concept, from logos, products, aesthetics to Pokemon.

You can then use these new models, combined with existing pre-built models (e.g. overall, color, food, wedding, travel, etc.) to browse or search for content media using Keyword Tags or similar images.

AI technology gives businesses a competitive advantage that is available to any developer or business of any size and budget. A great example is Pinterest’s recent update to its Chrome extension, which allows users to select any online photo and then ask Pinterest to show similar items using image recognition software.

It's not just about introducing a new Pinterest search experience powered by AI.

Shoppers are rapidly embracing new software platforms – powering eCommerce websites and creating innovative visual search capabilities.

As well as finding the right product, AI allows shoppers to explore complementary product offerings whether it be size, colour, shape, fabric or even brand. The software’s intuitive capabilities are truly outstanding.

First, by capturing visual cues from uploaded images, the software can successfully assist customers in finding the products they desire. Consumers no longer need to shop to see something they want to buy.

For example, we may like our friend’s new dress or our colleague’s new Nike shoes. If there are images, through AI, consumers can easily find similar items in e-commerce stores.

2. Retarget target customers

According to Conversica, at least 33% of leads go unfilled by sales teams . This means that pre-qualified potential buyers who are interested in your product or service often fall through the inevitable cracks.

On top of that, many businesses are overwhelmed and have a hard time managing customer data, yet the company does little or nothing about it. This is an incredible source of profit, the insight of which can be used to improve the sales cycle.

For example, if we look deeper into the retail industry, facial recognition is used by scanning customers' faces on surveillance cameras.

But how can AI be used to enhance the customer shopping experience?

Some AI in e businesses are now using facial recognition to track how long customers spend in stores.

This means that if a customer spends a long enough time next to a product, such as an iPod, this information will be stored for use on their next visits.

As AI develops, companies are offering special product deals on customers’ computers based on how long they spend in stores. Omnichannel retailers are starting to make progress in their ability to remarket to customers.

Sales are changing with businesses responding directly to customers. It's like businesses are reading customers' minds thanks to data used with AI.

3. Identify specific target prospects

Advantages of ai in ecommerce technology provides e-commerce companies with the information they need to promptly address business challenges and generate leads.

Predictive marketing companies like Mintigo – which provides AI solutions for marketing, sales, and CRM systems. Using Mintigo’s software, Getty Images has successfully found potential customers by crawling the websites of businesses that have featured images from Getty’s competitors.

Getty can re-qualify high-quality leads – giving the company’s sales team a competitive edge in closing new business. Real-world business intelligence is available to Getty’s sales team at scale and across millions of lead profiles. Without AI and machine learning, Getty’s system would not be able to do this volume.

4. Create a more efficient sales process

Most companies have switched from old sales techniques like choosing trusted Yellow pages and connecting with customers through cold calling.

Consumers’ lives are influenced by a variety of mediums, from TV ads to social media. In fact, over the past 12 months, even Snapchat has established itself as a standalone marketing and sales tool, creating new opportunities.

If a company wants to re-engineer its solutions to solve problems and create a powerful sales message that reaches consumers at the right time on the right platform, integrating AI into its CRM is the way to go.

Many AI systems enable natural language learning and voice input like Siri or Alexa. CRM systems will answer customer queries, resolve issues, and identify opportunities for sales teams. Some AI based ecommerce CRM systems can therefore multitask to handle all of these functions.

The North Face , a major eCommerce retailer, is stepping up their game by using AI to better understand their consumers. Using Watson – IBM’s AI solution , it allows online customers to see which jacket would be a great fit for them.

The company achieves this by asking customers questions like “where and when will you use your jacket?” using voice-activated AI technology. IBM’s software then scans hundreds of products to find relevant results based on the customer’s current information and research, such as weather conditions in the local area.

There is little doubt that AI has already begun to impact the e-commerce industry and evolve the sales process with new data. These changes ensure that customers are offered the right products and services.

AI is making profound changes to the way companies do business – enabling faster access to information and better harnessing the capabilities of employees.

5. Take the next step in cross-device personalization

Personalization is nothing new to eCommerce. If you’ve used Amazon on a regular basis, you know exactly what we’re talking about. However, with advances in artificial intelligence and machine learning, deep levels of personalization have permeated the rapidly evolving world of eCommerce.

Meanwhile, AI-powered personalization for eCommerce takes an omnichannel approach. New AI tools, such as Boomtrain , rely on multiple customer touchpoints and help businesses analyze how customers interact online.

Whether it’s a mobile app, website, or email campaign, AI tools continuously monitor all devices and channels to create a comprehensive view of the customer. This unified customer vision enables eCommerce retailers to deliver a seamless customer experience across all platforms.

The next time a customer searches for an iPhone case on the company's website, they can receive a notification about the company's flash sale on iPhone cases. The customer can make the purchase directly on their phone, saving both parties a lot of steps.

6. Provide friendly interactions with chatbots

Technology has advanced like a whirlwind and has changed customer expectations so that commerce is now focused on building personal experiences rather than mass markets. For consumers, company interactions influence purchasing decisions.

Many eCommerce retailers are becoming more sophisticated with AI’s ability to reach and capture attention becoming more popular and is called “Conversational commerce” (Mobile eCommerce, integrating the ability to communicate between sellers and buyers through messaging applications such as Facebook Messenger, WhatsApp…).

In eCommerce, it’s a combination of visuals, voice, text, and predictions. Consumer demands are evolving so quickly that retailers are struggling to keep up.

If brands want to survive, this is one of the business strategies that must be prioritized. Using artificial intelligence through the application of 'chatbots' is just one way to foster conversations in the era of conversational commerce.

So, what is a Chatbot?

A chatbot is a computer program designed to simulate a conversation with a customer over the Internet.

Chatbots can take on some important responsibilities like running an online business, especially when it comes to performing tasks for operations and marketing.

Chatbots can automate the ordering process efficiently and cost-effectively to provide customer service. Online customer service is becoming a necessity rather than an option.

Typically, when consumers shop online, they are already logged into social platforms like Facebook, so there is a great opportunity to use messaging to confirm orders or provide instant online support.

It is possible to integrate a chatbot system into the shopping cart.

Once the chatbot system is integrated with the company's shopping cart, it works with all stores on the platform. The more shopping carts a company's chatbot application supports, the more potential customers it has.

Additionally, systems integrate with shopping carts to retrieve information such as product details, quantities, and shipping terms that chatbots use to provide accurate answers to customers.

Chatbots provide customer support solutions for eCommerce retailers. The company has several alternatives such as forms, phone, and email. However, live chat is still the fastest way and in many cases, Live Chat is the most convenient way for visitors to get answers.

7. Empower store staff

While many online retailers have experimented with chatbots, few are considering the usefulness of recreating the in-store experience.

Lowe's is a home improvement store that introduced its first autonomous robot in late 2014, called the LoweBot.

Lowebot greets customers in-store, guides them around the store, sources relevant product information, and even assists employees with inventory management .

This allows Lowe's to move experienced store employees and involve them in customer interactions.

8. Virtual assistant

We all need online help sometimes.

So, what are cloud-based AI software agents used for?

We are all familiar with the usual virtual assistants: Siri , Google Now and Alexa , they have successfully introduced us to the idea of ​​talking to our phone, laptop or even a home appliance.

However, the evolution of many of these virtual assistants has become a boring commodity for users, with limited and useful updates in recent months.

Advances in virtual assistants all stem from natural language processing and the ability of machines to interpret what people say through speech or text.

So what does this mean for eCommerce retailers?

Consider Amazon's virtual assistant, Alexa.

Alexa has recently emerged as one of the prominent voices in the commercial space, successfully integrated into Amazon products as well as those of other manufacturers.

For example, using Alexa on an Amazon Echo device, customers can discover local weekend gigs through StubHub, arrange transportation to and from an Uber event, or order dinner from a Domino's event (tracking order status in real time).

1-800-Flowers is growing in popularity in the US and advancements have even allowed consumers to send flowers to loved ones using just their voice.

Virtual assistants are impacting the way customers shop and offering innovative opportunities for eCommerce retailers.

9. Integrate with everyday household items

Some of the more interesting examples of AI integration beyond Amazon's Alexa collaboration are LG's Smart InstaView refrigerator.

LG has experimented with a few previous versions of its InstaView refrigerators with giant touchscreens built into the door. This time, however, LG has included a virtual assistant and webOS software. That’s where the virtual assistant’s capabilities really come in handy.

In addition to providing news and weather updates, refrigerators help customers place their shopping orders. We can buy milk right at home. Imagine the possibilities of eCommerce retailers reaching directly into consumers’ homes.

10. Improve customer recommendations

Using AI, brands can intelligently and efficiently scan petabytes of data to predict customer behavior and make relevant and useful recommendations to each customer.

This level of awareness is crucial in providing a personalized shopping experience to consumers.

Starbucks has been heavily involved in using AI and analyzing all the data they collect about their consumers so that Starbucks makes more personalized recommendations.

For example, Starbucks recently launched ' My Starbucks Barista ', which uses AI to allow customers to place orders using voice commands or text messaging.

The algorithm leverages a variety of inputs, including account information, customer preferences, purchase history, third-party data, and contextual information.

This allows Starbucks to deliver more personalized messages and recommendations to customers.

The eCommerce industry, has revolutionized the way mobile shopping is done. The desire of eCommerce companies is to deliver the best offline shopping experience, by providing customers with a seamless way to discover the products they are actively looking for.

There is a key point in ‘hyper-personalization’, which is facilitated by understanding consumer behavior and making predictions. Hence a huge amount of data is collected from user activities on smartphones, tablets and desktops.

The recommendation process is widely practiced by eCommerce retailers to help customers find the best solution.

For example, Amazon makes recommendations to users based on their activity on the site and any past purchases.

Netflix makes TV and movie recommendations based on user interactions with categories, such as drama, comedy, and action.

While eBay collects user feedback on products to recommend products to users with similar behavior.

This continues to evolve with some changes and consolidation. AI has been put to good use in providing personalized recommendations to subscribers based on customer preferences and the company expects this to grow rapidly in the coming years.

11. Introducing virtual shopping assistant

AI enables brands to create purpose-built 'virtual shopping assistants' to assist customers online.

There are many benefits to shopping in-store that both brands and customers love. For example, customers have the opportunity to chat directly with sales staff.

Employees can ask customers for an item in a specific color or size. But this privilege is only available online, as customers have to go through a time-consuming (and sometimes frustrating) process of checking boxes or entering keywords.

As a result, many eCommerce retailers have had to find new innovative ways to make the online experience as good as the offline experience.

Flipkart, an India-based eCommerce company, has been working to build human-like capabilities to sell smarter to its over 45 million registered online shoppers.

In fact, the company launched a messaging service called Ping, which until it was shut down in 2016 was a shopping assistant that featured artificial intelligence that allowed customers to quickly find the items they were looking for.

Flipkart discontinued the app after just 10 months to focus on improving its 'user-to-seller' chat.

In 2016, department store Macy’s partnered with IBM’s Watson to create a personal AI mobile shopping assistant called ‘ Macy’s On Call ’. An innovative and cognitive mobile tool that uses Watson’s natural language API, Macy’s On Call is designed to assist shoppers with a virtual assistant that provides information at ten Macy’s retail stores across the country, as they navigate each store.

Amazon's home assistant, Alexa, is perfectly suited to providing a modern shopping experience to consumers.

Customers can simply ask Alexa to order milk in the morning and don't need to go directly to the store.

In addition, Alexa uses Amazon to place orders for us, the company is ready to deliver the next morning. An attractive feature is that Alexa only needs to verify the voice to process the order. Alexa is truly a real shopper at the command of your voice.

We might have heard of ' Mona ', the virtual shopping assistant developed by ex-Amazon employees.

The impressive and friendly assistant simplifies mobile shopping and provides customers with the best deals and products that best match their preferences. In fact, the more time and effort we spend interacting with Mona, the better she gets to know us.

Sentient Technologies , the world’s most funded AI company, is also leveraging AI systems to deliver in-the-moment personalization, increasing engagement and revenue per shopper for retailers.

The company believes that AI will play a major role in making decisions, creating superior solutions and providing insights, resulting in a more productive society.

Sentient shows customers things to see and buy that they never knew or understood what they liked. The advent of virtual shoppers is a real example of how AI, for the eCommerce industry, has completely disrupted traditional customer engagement techniques.

12. Working with intelligent agents

Intelligent agents negotiation systems have become a popular tool used in e-Commerce, following the development of artificial intelligence and agent technology.

There are three main functions performed by automated agents: matching buyers and sellers; facilitating transactions and providing infrastructure.

Agents are fully autonomous and have control over their actions. Agents have their own communication language and not only react to their environment, but also have the ability to use initiative such as creating their own Agent goals.

It is AI at its best and useful for the eCommerce industry.

13. Building intelligence tools

Customers expect retailers to change their pricing strategies. Therefore, omnichannel retailers must adopt flexibility in their pricing structures to retain customers.

Many retailers are turning to intelligence – enabling 24/7 visibility and insights into entirely new value propositions versus competitor product categories.

Businesses can track their competitors' product mixes, Products are segmented by product type and brand, and overlap rate. The intelligent type tool then gives businesses the ability to adjust product mix and pricing with high precision.

A powerful competitive advantage is providing complete visibility into what products are available in the market. Intelligent software puts retailers in a strong position to make specific assortment and planning decisions and track the business impact of those actions.

14. Bridging the Gap Between Personalization and Privacy

When it comes to personalization, we often worry about user privacy. User privacy has been a hot topic in recent years, with its importance being considered stronger than ever.

Brands are actively striving to take transparency, security, and honesty to a whole new level. However, to achieve this, brands cannot abandon user personalization, as it plays a vital role in any successful e-commerce venture.

So how can eCommerce retailers solve this problem? Many brands believe the answer lies in artificial intelligence.

Users feel more comfortable sharing details with the promise of getting something truly valuable in return.

For example, if we give Google current access to our account, Google will synchronize our calendar, email, and search habits.

Google will greet us in the morning with a summary of what we have and let us know if our train is cancelled we'll be late for work.

Amazon’s Alexa applies the same magical approach to everyday life. Modern shopping assistants prioritize daily routines and even help us with daily chores. Most recently, Amazon added the intelligence needed to let Alexa shop for us.

So, what is the end result?

More and more consumers are aware of Amazon's Alexa-based products including Echo & Dot and a large portion are using them in their daily lives.

AI enables retailers to deliver superior experiences throughout the user's day even when the user is not browsing the e-commerce store.

To get such an experience, users share their details. That's how AI is bridging the gap between user personalization and privacy.

15. Generate sales from wearable technology

We are all aware of the important role mobile devices play in e-commerce.

In fact, according to Shopify, 2016 saw mobile surpass other channels as the primary source of eCommerce traffic. As products like the Apple Watch, FitBit, and other forms of wearable technology enter the eCommerce market, the impact on eCommerce retailers is huge.

So, why is the technology useful for eCommerce platforms ? Because wearable devices have the ability to collect data beyond what eCommerce platforms do today.

Some technologies can see what products a user has viewed, determine their interests, and can instantly recommend personalized products.

We start adding in physical data like vital statistics, measurements along with pupil dilation rates, to the degree that recommendations can be tailored is truly amazing.

Amazon Go promised to revolutionize the customer shopping experience by going cashless. Customers no longer need to pull out their wallets thanks to wearables; that's the key to a checkout-free shopping experience.

AI integration will be at the core of any evolution as retailers enhance their customer experience with data. Forward-thinking eCommerce retailers will want to build new partnerships with the best AI technology to stay in touch with their growing global customer base.

16. Improve dialogue systems

Amazon has begun applying AI to conversational systems, such as speech recognition, natural language understanding, and question answering.

For example, by applying a machine learning algorithm called ' deep learning ', Amazon can efficiently convert speech (spoken by customers) into text with highly accurate results.

Amazon is also tackling the problem of automated question answering using AI by leveraging content on its websites like product descriptions and customer reviews.

For example, a customer might ask “how many USB ports are on this particular laptop?”

More complex questions would include “does this camera work indoors?” or “Which of these two TVs has better picture quality?”

AI is bringing new opportunities for eCommerce retailers to engage with customers.

17. Dealing with fake reviews

Any experienced online retailer will receive at least a few fake reviews for the brand.

Consumers are exposed to countless advertisements every day, which can become overwhelming and often delay decision making. This is where word of mouth becomes invaluable.

If a customer's friend purchased the company's product and had a positive experience, the customer will eventually buy the product as well.

In fact, according to a recent study by Dimensional Research, an astonishing 90% of respondents who read online reviews said that positive online reviews influence their purchasing decisions.

More importantly, 86% say their purchasing decisions are influenced by negative online reviews.

What if these reviews are fake? AI is used to manage this issue and here's how:

Regarding the creation of fake reviews, known as 'astroturfing' and prevalent on many websites or services including Amazon.

By definition, astroturfing is the creation of false or fraudulent popular reviews that customers will believe to be credible and reasonable testimonials resulting from a neutral third party.

Customer reviews have become the foundation of trust in the online shopping world. When users can't see what a product looks like before buying it, ratings and reviews from users who have supposedly purchased it before can make or break a product.

Some eCommerce retailers are using artificial intelligence to combat astroturfing by placing more emphasis on verified and helpful reviews.

Amazon is using AI to combat fake product reviews and inflation in its popular star rating process.

Built in-house, its AI machine learning system ensures that the prominence and weight of purchase reviews with customer verification are enhanced.

There is also priority given to reviews that have been marked as helpful by other users, as well as reviews that are newer and more up-to-date on the site. The company is constantly looking at certain features of reviews, such as their ratings, to detect fake reviews. They are important to the company because they help build customer trust in Amazon.

18. Say no to counterfeit goods

Product, brand, and category attributes are also useful for detecting counterfeit products.

When browsing large online marketplaces, it can be difficult for everyday consumers to identify counterfeit products from third-party sellers. When consumers purchase a product that appears genuine but is poorly used, it can leave them feeling uncomfortable and negatively impact their perception of the brand.

So how can eCommerce retailers tackle counterfeiting?

Chicago startup 3PM Marketplace Solutions adds an extra layer of brand protection by applying machine learning algorithms to detect counterfeits and help businesses understand how consumers discover products.

The company then draws on data from multiple online marketplaces and analyzes that data to determine which products are actually counterfeit. An intriguing and effective way of using artificial intelligence to solve the thorny problem of counterfeiting.

Rob Dunkel, founder of the tech startup, recently claimed that factors like an account's posting rate, the type of items the account sells, and even potentially fake reviews on listed items, are all used to flag counterfeiters. Customers can then file a complaint with a marketplace like eBay or Amazon, which can remove shady counterfeit products.

19. Localize the customer experience

With the rapid development of AI in recent years, we are starting to see more engines focusing on the service industry. Wayblazer – an AI platform for the travel industry, is an example of this.

Wayblazer uses ai in b2b ecommerce in the hotel, activities, cruises and tours business as well as for companies looking to generate new revenue through hotel bookings.

By integrating IBM Watson and natural language capabilities, businesses can successfully personalize local recommendations to consumers.

Personalizing results means that the information overload presented to travelers is cut out. This allows consumers to make decisions faster and with more confidence.

AI is expected to expand in this industry to the point where customers can type in specific adventures and it will provide them with a solution, for example “where can I go hiking on my honeymoon?” The AI ​​system can then provide personalized recommendations for places of interest and local insights that we don’t know about yet.

20. Conclusion

While the term “artificial” has negative or dehumanizing connotations, artificial intelligence allows businesses to provide more personalized experiences to customers.

AI enables eCommerce retailers to analyze millions of interactions every day and ultimately deliver to customers – an experience every marketer aspires to deliver.

Sales teams are now empowered with information we’ve never seen before. Sales teams can personalize the sales cycle through AI-driven applications and help salespeople engage prospects with the right message at the right time.

There have been many articles written about the impact of AI, especially on industries that rely on manual labor. As marketing expert Seth Godin puts it: “Artificial intelligence does a job that we don’t necessarily have to work so hard at, it does it quietly and beautifully, and we take it for granted.”

AI technology is likely to have a huge and beneficial impact on the eCommerce industry in the coming years. AI is changing and improving the way consumers search for products online.

AI is already walking and talking to us and in the age of Instagram and Snapchat, coupled with the rapidly diminishing attention span of the digital age, there is evidence to suggest that new AI-based platforms will be essential to success in the eCommerce industry.

Hopefully, the above article will provide you with useful information about ideas for applying AI technology to the field of e-commerce. If you need advice on solutions to integrate AI technology into your sales system. Do not hesitate to contact EDUTO experts for advice.

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