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By4 Min Read
May 06, 2019
Sci-fi geeks previously mocked for their far-fetched ideas about robots taking over the world can today smugly say, ‘hah! Told you so. We are no longer at the cusp of an era of artificial intelligence; we are living in it. Our daily lives are peppered with gadgets that use voice recognition, search predictions, and facial recognition. From systems that forecast the weather to those that predict stock prices, to self-driving cars—we are breaking new frontiers so rapidly that we rarely stop to think, about the constant evolution of these machines as we use them.
Artificial intelligence, simply put, is the ability for a machine to learn. It does this by continually analyzing patterns from the data it collects. The greater the collection of data, the more accurate the machine can become at making predictions. Gartner, Inc, projects that over 25% of customer interactions will be managed with virtual customer assistants by 2020. Machine-learning technologies can go beyond the scope of humans by learning and understanding every individual customer, even in an audience of millions.
Artificial Intelligence truly began in the unleashed imagination of fiction writers. Although the rich pages of Isaac Asimov may come to mind, the technology started impacting the real-world only in the 1950s when Alan Turing contemplated the question, “Can machines think?” The Turing test was once considered to be the benchmark for Artificial Intelligence—to pass the test, a machine must deceive a questioner into believing it is a human.
In recent decades, AI research has seen unprecedented acceleration. From the year 2008 to 2012, it was growing at roughly 5 percent annually; but since then, it has boomed with a growth of more than 12 percent annually. Today, Europe still leads in AI research, but within the next four years, China is predicted to take over as the global pioneer in artificial intelligence.
At the same time, trends have been changing in the world of business and retail. In 2018, e-commerce sales accounted for a whopping 11.9% of all retail sales worldwide. The number of global digital buyers is expected to rise to over 2.14 billion by 2021.
Since every marketing strategy boils down to understanding what consumers want, this puts AI at the forefront of the new era of commerce. Artificial Intelligence collects and organizes heaps of data that manual processing would take years to do (if at all). Based on this analysed data, it can make predictions that can save an organization vast amounts of time and money.
According to Juniper Research, AI chatbots could save businesses up to £6 billion per year across industries. But more importantly, it can give an organization greater precision while marketing, by knowing their customers better.
Here are some key ways that AI has made an entrance into the realm of e-commerce:
It might soon be the end of the line for contact forms, email and phone calls. More importantly, it’s a step in the right direction when it comes to delivering stellar customer experience. According to a report, 51% of customers never come back to a business after a bad experience. By kickstarting the ‘conversational commerce’ trend, Chatbots give e-commerce websites the ability to provide 24/7 customer support. They simulate conversations with customers and can execute tasks, automate order processing, and can also provide accurate answers to customers about product details, quantities and shipping terms.
According to a 2017 report by PwC, 34% of executives say the time they freed up using chatbots allowed them to focus on deep thinking and creating.
Chatbots increase response time and answer more than 80% of regular questions; freeing agents to carry out other tasks. Brands like Lyft, Alibaba, and Spotify are using chatbots to carry out various operations, such as booking a cab, finding the right music, and placing orders.
2) Image search
With AI, consumers can now search for products based on images they’ve come across. See an outfit you love? Simply take a picture and get matched to similar items on ecommerce websites.
Pinterest is already leveraging this technology by allowing its users to select any item from any photograph online and then throws up similar items through an image recognition software.
Since ecommerce sites process multiple financial transactions throughout the day, they are frequent targets for cyber attacks, fraud, and unauthorized access from hackers. Cybersecurity is a priority among top ecommerce stores that realise that cyber attacks can cost millions, and worse, damage their reputation as a trustworthy brand.
AI systems can detect irregular patterns, like spam and fraud, because of constantly processing data, and sound the alarm in real-time when it detects suspicious activity. For example, the cybersecurity company Prolexic monitors malicious cyber threats globally and analyzes DDoS attacks using their proprietary intelligent system.
Customer Relationship Management (CRM) have traditionally relied on employees to collect huge amounts of data in order to better serve clients. Today, several CRM software are capable of leveraging artificial intelligence to help in identifying trends, and predict which customers are most likely to buy products with impressive accuracy. This frees up sales teams to focus on their revenue goals.
5) Recommendation Engines
There are those who are familiar with recommendation engines, and then there are those who are shocked when their phone throws up ads for exactly what they needed. Is it a conspiracy?
eCommerce platforms powered by Machine learning algorithms are capable of analyzing customer behaviour from past searches, ‘like’ history, frequently bought products, and can recommend products for the user. Amazon, Facebook and Instagram are examples everyone is familiar with, frequently giving us recommended products and ads based on our history. Newer ecommerce store builders are capable of digesting massive amounts of customer data to generate highly personalized and contextual recommendations.
AI has the potential to spike sales and productivity like never before. Today, more than 75 percent of companies are using AI to power their decision-making processes and accelerate business development (as reported by Capgemini, 2017).
Perhaps the world is changing at a pace where we need to hold onto our seats, but Artificial Intelligence is more than a buzzword. It is a field of research that is unlikely to disappear anytime soon and businesses will do well to jump on the bandwagon at the earliest.
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