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How to Use Artificial Intelligence in Ecommerce

How to Use Artificial Intelligence in Ecommerce

Remember the days when Artificial Intelligence sounded like a futuristic venture that would involve machines taking over the world? Well, here we are today, in that projected future. In this scenario however, these machines aren’t ‘taking over’ in a scary way. Instead, they are giving us an edge, especially in the world of eCommerce.

What Is Artificial Intelligence?

Artificial Intelligence (AI) is an advanced and broad branch of computer science dealing with the design of smart machines that are able to carry out tasks that require human intelligence. The two main branches of AI that have been key players in its development are Machine Learning and Natural Language Processing (NLP).

The AI technology has also been adopted by the eCommerce industry with the aim to offer a more personalized and targeted experience for website shoppers. According to Statista, by 2021, a projected number of 3.8 billion people around the world will have smartphones and the numbers are only going up.

This means that mobile purchases are expected to increase and the need to provide a smooth and interactive experience for your leads will rise also.

In this article, we’ve listed some ways to use artificial intelligence in eCommerce and optimize your sales process.

1. Provide Effective Search Options for Users

Customer-centricity is all about providing a positive experience for your customers by placing them at the core of your business.

It’s annoying to search for something on a website and not find what you’re looking for, right? Your customers hate that too.

That is why your job is to provide users with options that can easily guide them to the products they are searching for. The two ways AI can help you do this is by implementing a voice or visual search feature.

Visual Search

Visual search can increase the engagement of your online store and boost the chances of converting visitors. It allows users to upload an image and search for similar items in your shop. Thanks to machine learning algorithms the system can process and classify the image and display similar results.

Voice Search

Voice search, already a popular option for browsing on Google, is a verbal type of query that makes use of voice recognition to display results. A good example of a voice search AI is Alexa, Amazon’s digital assistant that can recognize language and perform multiple actions based on commands.

2. Implement a Recommendation Sales Feature

A recommendation engine is a system that analyzes users’ data such as their browsing history and previous purchases to suggest information, products, and/or services.

Two popular recommendation systems include:

  • Content-based filtering – This technique makes use of a single user’s activities and choices and filters the metadata. It works by taking into account the behavior and activity pattern of the user and integrates them into an algorithm that provides recommendations to website visitors based on previous data.
  • Collaborative filtering – In this case, recommendations are made based on information obtained from several users, not just one. This method has higher accuracy than content-based filtering.
    Amazon makes use of this method and recorded a 29% increase in sales when this algorithm was incorporated.
Amazon Collaborative Filtering Example Screenshot

Source: Amazon

The recommendation sales feature gives potential buyers a personalized experience and increases the click-through rate of your website. The average order value also can go up, because customers are offered other complimentary options that go with their purchase. By engaging potential online shoppers with other options that are beneficial to them, they tend to stay longer on your website and are more likely to convert.

3. Set Up a Chatbot or Virtual Assistant

A chatbot is a great way to initiate a conversation with a user through different platforms. It can also work as an assistant to your buyers and help them navigate to the right choice.

Users are apt to ask multiple questions about products or services. But you can’t be online 24/7 to respond to these queries. So how about integrating an automated chatbot that can recognize a user’s intent by keywords or programmed scenarios?

About 64% of users expect to get real-time interaction from online businesses. With a chatbot, you can offer an immediate response as compared to making them fill contact forms or sending a mail.
A virtual or digital assistant is an application that understands natural language and can help users with their questions and thus increase the chance of a conversion.

4. Optimize Your Product Descriptions

Product descriptions give information to customers about your products or services, but they work for your SEO and help the ranking of your online store. That’s why the descriptions need to be well optimized as they can drive organic traffic to your website. Moreover, well-presented information about a product has the power to convince potential leads into making a purchase.

While this can be carried out manually, with artificial intelligence, you can automate the whole process and save yourself a whole lot of time.

An example of a website that uses AI for their product description is Alibaba. With the company’s AI tool, over 20,000 lines of content can be produced per second. This way, merchants on its website don’t need to spend time generating product descriptions.

Optimizing Your Product Descriptions Example Screenshot

Source: Alibaba

5. Get Rid of Fake Reviews

Fake reviews are like moles in a business. They are often dropped by competitors, haters, and sometimes even by bots.

But you know that reviews are quite important in the eCommerce world. About 90% of consumers make purchasing decisions based on reviews that they have read and 86% of buyers hesitate to purchase products from a company that has negative reviews.
Thanks to AI you can spot and remove the fake ones and prevent spam.

Get Rid of Fake Reviews GLTR

Source: GLTR

GLTR is a visual forensic tool that makes use of the Natural Language Generation model to detect automatically generated texts. This way, you have one less thing to worry about.

6. Take Advantage of Price Optimization

The price is one of the most decisive criteria for online shoppers. It is therefore important to make sure your prices are competitive and reflect the market.

Price optimization is the process of finding the optimal price that customers are willing to pay for a particular product or service.

As easy as that sounds, sometimes it can be complicated, especially if you are dealing with people around the globe. This means estimating how much items are worth in other countries and currencies. Here AI comes to the rescue again with a feature called dynamic pricing, which can be automated and set the best price for your product to sell. This can improve your conversions and sales as customers are usually searching for an item on different providers before making a purchase.

Amazon makes use of this feature and records over 250 million change in prices every day.

7. Automate Your Supply Chain

If your supply does not match the demand on your online store, you could quickly run out of items to sell. This could disappoint your customers and lead them to your competitors’ website.

With an automated supply chain management in place, you can have an e-shop that is always well-stocked so that you can capture those that are ready to buy.

Machine learning algorithms enhance supply chain management by automating the demand forecast and improve order management capability, production planning and factory scheduling.

Wrapping Up

Artificial intelligence enhances the creation and maintenance of online businesses and bridges the gap between merchants and consumers. Today’s online shoppers are becoming more demanding and you need to find new and smart ways to engage them. The shopping experience expectations are also evolving and you have to stay on top of the trends to grow. That makes AI a good friend to both eCommerce retailers and customers alike.