Show:
AI in eCommerce: 5 Tips to Streamline Your Business
When the hype around AI was booming towards the latter part of 2022, it took the headlines by storm!
AI is going to take your job!
AI will kill your business!
AI will eat your kids! (just joking)
Now that the dust has settled and we have had some time to reflect, there are some really useful aspects of AI.
In this post, I’ll share 5 real-world strategies on how to use AI in your ecommerce business – which you can implement today.
Let’s dive in.
The Need for AI in eCommerce
We’re in an era of instant gratification.
But it’s not just about speed; it’s about precision too.
As I scroll through Netflix, flick around on Youtube, or browse on various ecommerce websites, I’ve come to expect a curated shopping journey tailored just for me.
This isn’t a mere luxury, now an evolving necessity.
And this personal touch?
That’s AI working diligently behind the scenes, ensuring eCommerce platforms give us the best customer experience possible, through various forms of machine learning and AI algorithms.
Tip #1: Personalized Product Recommendations
Whenever I land on my favorite ecommerce stores, I’m often greeted with a selection of items that feel handpicked for me.
This isn’t magic; it’s AI analyzing my behaviors, past purchases, and even browsing habits.
By doing this, online stores can showcase products that I’m more likely to purchase.
For instance, I recently bought a walking pad to go under my desk for my office. Now Amazon is offering me other office gadgets and gizmos to go along with my purchase.
Coincidence? I think not!
The big sites like Amazon have been doing this for ages without the use of AI, but now small business owners like you and me can harness the power of AI to do this too.
Shopify plugins such as Drift AI can show personalized recommendations to your customers, increase average order value and improve your overall conversion rate.
You’ll also get a boost in customer loyalty too – what’s not to like?
And if you’re on Magento and not Shopify, no worries – Magento Product Recommendations powered by Adobe’s AI called Adobe Sensei is a similar sort of tool.
Tip #2: Chatbots and Customer Service
Most shopping sprees often come with questions.
And as I’m currently living in Europe, the time difference isn’t always in my favor – waiting for business hours to kick in can often be frustrating and will end my potential sales journey.
And here’s how store owners can utilize AI to their advantage.
Tools like Manychat allow you to build flows and answer customer service queries with ease. It’s a tool I have used since it first came out way back in 2016 and now with the power of AI it has come on in leaps and bounds.
These chatbots are great for quick answers to specific questions:
Things like, opening hours, product availability, and even finding tracking details can all be plugged in with an AI chatbot.
The beauty? They’re cost-effective for businesses and reduce the waiting time for consumers like me.
But a note of warning to eCommerce store owners: it’s crucial to maintain a balance.
While chatbots are efficient, there are moments when human intervention becomes inevitable, especially for complex queries that cannot be anticipated ahead of time.
Tip #3: Enhanced Search Capabilities
I can’t count the number of times I’ve abandoned a site due to its frustrating search function.
But recently, many online platforms have upped their game.
Thanks to AI, search bars now understand context, natural language, and even typos. Some sites even let you search using images or voice commands.
This means less time searching and more time enjoying the shopping experience.
Even Amazon is now implementing a new project dubbed ‘Project Nile’ which will use AI to enhance the customer search – which the big cheeses of Amazon hope will increase sales even more than they are.
Tip #4: Demand Forecasting and Inventory Management
Ever had your heart set on a product, only to find it out of stock? It’s disappointing, and for a store owner, it’s lost money. Period.
AI, however, is gradually reducing such instances.
Many ecommerce stores can quite easily use an AI Shopify plugin such as Smart Purchase Orders to track sales, inventory and maintain the glorious 100% in-stock-rate.
By predicting demand based on historical sales, trends, and even external events, this AI tool ensures that businesses stock up appropriately at peak times throughout the year.
This not only pleases shoppers like me and you, but also reduces overhead costs related to overstocking or understocking.
Tip #5: Dynamic Pricing Strategies
Pricing can make or break a deal. I’ve often been swayed by timely discounts or deals that seemed to pop up just when I needed them – and we all LOVE a deal right?
Dynamic pricing, powered by AI, allows businesses to adjust prices based on various real-time factors.
Intelis is one of these tools. It uses AI to update pricing automatically based on demand and trends. Pretty cool.
Artificial Intelligence Challenges and Considerations
So yeah, the AI revolution is not without its flaws.
It has emerged as a potent tool for transforming the ecommerce sector, but like all innovations, it comes with its own set of challenges and considerations.
Here are a few.
Data Quality and Quantity:
Challenge: AI thrives on data. For any AI model to work efficiently, it requires a vast amount of quality data. Ecommerce businesses, especially new or smaller ones, might not have enough relevant data to train their models.
Consideration: Ecommerce businesses should invest in data collection and curation. Ensuring the quality of this data is paramount to avoid the infamous “garbage in, garbage out” problem.
Integration with Existing Systems:
Challenge: Integrating AI solutions into current ecommerce platforms and infrastructure can be complicated and might require substantial changes.
Consideration: Businesses should select AI solutions that are compatible with their existing systems or be prepared to invest in the necessary integration.
Customer Privacy Concerns:
Challenge: AI often requires access to user behavior and personal data, which can raise privacy concerns.
Consideration: Ecommerce businesses should prioritize data protection, transparently communicate their data usage policies, and comply with relevant privacy regulations (like GDPR).
To Sum Up
My journey through the AI-infused eCommerce world has been both fascinating and rewarding. With its potential to revolutionize shopping, AI is undeniably reshaping the way we browse, choose, and purchase.
Combining these forms of AI into your marketing approach will boost revenue, brand awareness and overall business gains.
As we look ahead, the blend of technology and personalized shopping, promises even richer buying experiences.
About the author:
Matt Hapgood is a father, surfer, and entrepreneur. He has worn many hats in his career, from being a removal guy in Vancouver to teaching elementary kids in the UK, as well as a parking valet in the French Alps. He’s the founder and main contributor to MattHapgood.com and is currently living in the Algarve, Portugal.
Follow him on Instagram here
Return to Previous Page
