Artificial intelligence (AI) is quickly becoming an essential tool for businesses of all sizes. E-commerce companies, in particular, can significantly benefit by implementing AI-based solutions. The heart of the entire process is machine learning, a technology that enables systems to automatically improve their performance over time. This technology is being applied to e-commerce through APIs that allow companies to integrate AI-driven features into existing e-commerce businesses that want to stay competitive and drive growth. This helps companies make informed decisions about personalizing offerings, optimizing pricing strategies, and improving customer experience. AI also automates routine tasks such as fraud detection and analyzing customer service interactions, freeing up resources for more strategic initiatives. What’s more, AI-powered chatbots and voicebots can handle customer inquiries 24/7, improving overall customer service efficiency.
Here are six reasons why you should consider implementing AI solutions into your e-commerce platform:
- Improved customer service
According to a study by Grand View Research, the size of the global chatbot market is expected to reach $9.4 billion by 2024, with a CAGR of 24.3% during the forecast period. This underscores the growing importance of chatbots in customer service and the potential for significant growth in this area in the future.
Chatbots and voicebots powered by AI artificial intelligence engines, are great solutions to provide 24/7 customer service. They answer frequently asked questions, help with orders, provide information about products and services, support service requests and claims, accept property or traffic damage reports, support the conclusion of a purchase-sale agreement, and even replace traditional IVRs by redirecting calls to the right person or providing answers on a topic where the customer needs quick information. AI-based chatbots and voicebots understand the customer’s intention and remember the context of the conversation in progress. Thanks to the digression functionality, they are able to dynamically answer a side question of the interlocutor and return to the ongoing conversation remembering its main thread. They collect a set of necessary information to accept an order or request. Bots guide customers through routine processes and help them complete a case in minutes without unnecessary delays or the need to fill out cumbersome forms on the website or have to write messages. Thanks to easy integration with external systems, they can forward some calls to a hotline consultant or, in text form, they can send the collected information to a designated email address or to the appropriate system. Implementation of such solutions can significantly improve customer satisfaction and loyalty.
Chatbots and voicebots assist customer service consultants in routine tasks by shifting their focus to tasks requiring much more creativity.
The implementation of AI-based chatbots and voicebots involves an investment in the necessary technology and resources, such as natural language processing (NLP) and machine learning (ML) tools, as well as ASR and TTS systems, i.e., speech-to-text and text-to-voice processing. It is necessary to build dialogue trees and train the bot within a given business process. The training of the bots is based on the introduced examples of questions and answers and on the basis of the conducted conversations. With a sufficiently long period of training, bots based on AI engines can achieve efficiency even above 90%.
It is now possible to create a virtual assistant that resembles the style of the brand the company presents. Such services are offered, among others, by Unima 2000, which is part of the Euvic Group.
- Personalized product recommendations
One of the most powerful ways AI can enhance personalized product recommendations in e-commerce is through the use of machine learning algorithms.
The benefits of implementing an AI-powered personalized product recommendation system are numerous. For example, it can help increase sales, due to the fact customers are more likely to purchase products that are tailored to their preferences. It can also improve engagement and loyalty among customers, who are sure to appreciate the personalized experience.
According to a study by Accenture, e-commerce companies that use personalized product recommendations powered by AI can see an average increase in sales of 30%. Additionally, a study by Forrester Research finds that personalization can lead to up to a 15% increase in sales.
- Inventory management
Artificial intelligence can improve e-commerce inventory management by using machine learning algorithms to optimize inventory levels. These algorithms can analyze data such as sales history, customer demand, and supplier lead times to determine optimal inventory levels for each product, reducing the risk of out-of-stocks and overstock.
According to a study by Accenture, AI-powered inventory management can help retailers reduce inventory costs by 10-15%. Additionally, a study by IDC predicts that by 2023, 80% of companies will use AI to support the inventory management process.
- Fraud detection
Artificial intelligence can improve e-commerce fraud detection by using machine learning algorithms to analyze customer data and detect patterns of fraudulent behavior. These algorithms can analyze data such as customer demographics, purchase history and shipping information to identify potential fraud and protect your business from financial losses. It can also improve customer satisfaction and loyalty, as the system can ensure that their transactions are safe and protected. Additionally, AI can help improve efficiency by automating the fraud detection process and quickly flagging suspicious transactions.
According to a study by Juniper Research, the cost of e-commerce fraud is expected to reach $71 billion in 2023. Additionally, a study by Accenture finds that AI-powered fraud detection can reduce the number of false positives by up to 30%.
- Price optimization
AI algorithms can analyze market data to optimize prices in real-time. By implementing AI algorithms, e-commerce companies can analyze large amounts of data, including customer behavior, market trends, and competitor pricing, to determine the optimal price for their products. Such price optimization can result in increased profitability, improved customer satisfaction, and a competitive advantage in the market.
To do so, it is worth using natural language processing (NLP) to analyze customer reviews and opinions. This can provide valuable insights into customer preferences and pain points that can be used to inform pricing decisions.
- Marketing automation
Artificial intelligence can enable e-commerce companies to optimize marketing strategies and drive growth by providing them with the ability to perform big data analysis and make decisions based on it. By implementing AI technology, e-commerce companies can gain a deeper understanding of their customers and market trends, allowing them to create highly targeted and personalized marketing campaigns that drive conversions and increase revenue.
In short, AI is transforming the e-commerce industry by providing companies with advanced data analysis capabilities. AI algorithms and models can quickly analyze vast amounts of customer data, such as browsing behavior, purchase history, and feedback, to provide actionable insights. This makes AI a powerful tool for e-commerce companies that want to stay competitive and drive growth.
Marketing Specialist at Euvic