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GUEST COMMENT Demystifying AI’s purpose in the ecommerce journey

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Artificial Intelligence (AI). Automation. Machine Learning. Hyper-Personalisation. These are just some of the terms that have entered the lexicon of the online retailer.

 

Today these ‘buzzwords’ often do little more than perpetuate many of the myths surrounding their use. Nonetheless, these technologies are redefining the art of marketing to the consumer. It is important therefore that ecommerce practitioners don’t just jump on the AI bandwagon. The first step in proving AI is more than just ‘hype’ comes from dispelling some of the most common myths surrounding the term.

 

Myth #1: AI is a miracle sure


AI is not a ‘silver bullet’. Too often online stores are compelled to adopt AI in pursuit of ecommerce excellence and prestige, but quickly realise that AI is only as good as the data you feed it. The ultimate goal shouldn’t be to say ‘I have AI’, but rather, make sure their solution is set up to enhance their brand’s wider customer acquisition strategy. Retailers must first prepare their baseline, and there are tools which can help in this process. Only by doing this will more advanced technology pay dividends. By using the tools wisely and in the right order, they will be more likely to keep up with competitors and adequately respond to growing customer demands around user experience and overall digital delivery.


AI is by no means a ‘one-size-fits-all’ solution, and it is not advisable to try to leapfrog from a standing start to full automation. There are numerous ways that it can be used to create a better experience for customers. Take Netflix, for example. Its success story cannot be explained without understanding their granular knowledge of their subscriber base and their AI-driven focus on personalisation. Netflix not only looks at millions of ratings, searches and “plays” a day, but the entire viewing history of billions of hours of content streamed per month. This process certainly appears to be paying off, but the groundwork takes time; it took 6 years to collect enough viewer data to engineer a show that became the worldwide success: House of Cards.

 

Myth #2: AI just means automation


The biggest pitfall for online retailers going forward is to think that AI is just an automation tool designed to help reduce workload. The key is to use AI to augment the customer journey, creating unique, individual pathways for each user, following that customer recipe. Not only does this establish good relationships with consumers, it also builds the trust needed to ensure customers continue sharing data with you. Only when you have a rich pool of information on your customer can you really deliver the one-to-one personalisation they demand. AI helps you scale - but it also helps you advance through much more than automation. It helps you unearth and implement the knowledge that can drive commercial success through happier customers.


Take the travel industry, for example. Online travel agencies such as Booking.com, can use AI to effectively analyse behavioural data to suggest journeys or holidays to consumers at the optimal time in their lifecycle –when they are ready to book. Booking journey becomes a more refined experience. Many travel sites, for instance, are using chatbots that communicate directly with customers to solve a range of problems, from finding the appropriate hotel to receiving boarding passes and check-in notifications. Passengers therefore no longer have to put up with waiting for an eternity on the phone or browsing through hundreds of web pages to get their queries sorted out. Soon enough, online travel agencies might know what your dream holiday is before you do!


Myth #3: AI will steal your job


While AI will replace certain tasks and play a major role in automation, the function of brand positioning will in no way become obsolete. On the contrary, by taking on time-consuming, labour-intensive tasks and working data harder - through aggregation, analysis, recommendations and segmentation - brands will be able to invest their time and energy in refining customer journeys and sales strategies. AI will undoubtedly take on a bigger role in the sales lifecycle, but automation is no substitute for creative engagement with customers. In the future, online sellers and internet retailers will rely on AI to complement human interaction, by taking care of the digitally-led aspects of their brand and allowing them to concentrate on their first love: their brand’s overall purpose. After all, customers’ needs stories to encourage them to actively engage with brands, creating true loyalty extending beyond the first one-time purchase.

 

The promise of AI is no myth


It is clear AI is shaping the next generation of online shopping. However, today it’s languishing somewhat on the periphery of wider acquisition strategies, as many brands race to catch-up with what they see as a complex technology. It’s essential that they at least begin their journey to incorporate AI into their strategies to uniquely tailor the experience of each customer.
The maths of shopping is simple: according to our recent study, 41% of consumers will boycott a brand if it fails to deliver offers and recommendations not personalised to them. Customers are now more open to the use of AI if it improves their overall experience. Brands can march ahead now, confident that they have the technology to fulfil the promise of true one-to-one personalisation.

 



Author: Grant Coleman, vice president and market director for UK, Nordics and Benelux at Emarsys

Image credit: Fotolia

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