AI, or artificial intelligence, used to strictly only be associated with the realm of science fiction. However, today, it has entered the world of science while also taking on a constantly increasing position in the fastest growing as well as the most innovative organizations of today. Indeed, through AI, marketers have been able to understand their customers a whole lot better while it has also let firms leverage predictive modeling so that they can figure out or predict how the outcome of a certain campaign or test will perform based on the data that has been gathered.
However, talking about the progress in AI is entirely different to truly understanding the real-world utilization of this pervasive technology.
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Big Box AI
Amazon is the most notorious company that utilizes AI in ecommerce. Indeed, Amazon has completely altered both the shopping and the buyer behavior-targeting algorithms to a level that’s very advanced, starting from when it first dipped its toes into AI in order to make personalized recommendations.
Amazon takes advantage of AI in order to deal with its dynamic pricing model which revolves around decreasing prices whenever inventory is high and demand is low and then raising the prices as soon as the supply decreases. However, Amazon doesn’t only use AI in their website; they also use it in its Echo Look, which is a home device that provides users with outfit suggestions. In other words, Echo acts as a personal shopper as well as a stylist.
Only over time will we see what happens next for this ecommerce giant, however, you can rest assured knowing that it will completely rattle what we currently know ecommerce to be. However, Amazon isn’t the only firm that utilizes AI. Take, for example, Starbucks, which is notorious for its coffee personalization that way they can cater to everyone’s different tastes. They have taken things up a notch by utilizing information from their sources that are readily available to them like both their mobile application as well as their loyalty card. Through them, they are able to figure out what customers are purchasing and at what time. As a result, they are able to evaluate the information to forecast how they can boost the customer’s average per-order amount.
Is AI Technology Useful for Smaller Firms?
Most definitely! We have only talked about giants such as Amazon and Starbucks so far because they have huge budgets with employees and the knowledge necessary to scale their operations to positions that small companies could only dream of. That being said, small firms and startups aren’t destined to fail when it comes to taking advantage of AI in order to hold onto customers. Indeed, a lot of small firms can use AI-powered solutions by incorporating them into their operations so that they can gather very crucial data that will let them make decisions with certainty with regards to their target audience as well as come up with strategies that are backed by behavior rather than by educated guesses.
How Small Companies are Able to Benefit from AI
Search Powered by AI
Regardless of the size of the company, a firm can take advantage of AI through search. Indeed, AI-backed search lets online retailers go into on-site customer behaviors that way they can figure out what is being searched, at what time, and the frequency of the search, along with many other aspects. On top of that, in the case that a shopper doesn’t know what they are looking for, AI can come into play and help pinpoint them in the right direction. For instance, if a user can’t seem to remember the name of a certain brand, AI-powered search is smart enough to be able to figure out what the product is, even in the case that the name isn’t spelled correctly. Features such as autocomplete as well as auto correct let online merchants take advantage of boosted sales and profits from searches that would have, in any other case, not come up with any searches that were relevant. This would have caused the customers to think that the product wasn’t in stock, for example, or that it simply wasn’t available at the time.
Sales Forecasting and Predictions
Small companies can also benefit from AI by utilizing sales forecasting. Before, purchasing items or trying out services that had just come out required a lot of money in order to make tests and then the response of it was simply a hypothesis. Today, going about it in that fashion would be quite expensive as well as risky. Thankfully, though, through AI predictive modeling, both plans and strategies can incorporate large-scale sales forecasting in order to figure out if a launch will be profitable when it comes to things such as historic trends or consumer behavior. As a result, firms can accurately pinpoint what may occur depending on the situation. Best of all, firms wouldn’t have to spend the energy or the money at the start in order for it to occur.
Ad Purchasing That’s Automated
Outside of small firm websites, AI has additionally helped changed how companies are able to market themselves on the web. AI-driven automated systems deal with both the purchasing and the selling of advertisements while improved algorithms and data collection track how customers interact with those advertisements in order to offer real-time optimization for their campaigns. In the end, the advertisements cater better to the preferences of their customers and it better reflects their journeys, too.
The Conclusion of AI in Ecommerce
Based on the information earlier, it’s clear that AI has made big progress in ecommerce in the past several years. Just as innovators such as Amazon and many other businesses forged ahead, smaller companies are able to follow in their footsteps, while dealing with both the uncertainty and that experimentation that goes hand-in-hand with it, so that those businesses that are ready for it can reap the benefits that come out of it.