Introduction
As cliched as it sounds, consumer demands in the digital commerce sector are escalating at an unprecedented pace. Incorporating artificial intelligence (AI) has emerged as a crucial strategy to keep up with these dynamics and enhance the customer experience. Artificial intelligence in digital commerce CX is also setting new benchmarks to streamline operations, create meaningful customer interactions, and boost the brand reputation. As most customers expect personalized, seamless, and intuitive interactions, it has become mandatory for businesses to incorporate AI into their business processes. According to a report, 65% of senior executives believe AI and predictive analytics increase customer retention and loyalty.
This blog will explore how AI-driven solutions improve brand engagement with customers and elevate business performance.
The AI-Powered CX Model For Digital Commerce Brands
AI is slowly becoming a norm. Whether personalized recommendations or automated customer service, AI-driven solutions are reshaping how brands engage with their customers. Let’s look at how AI is revolutionizing the customer experience for digital commerce brands.
1. AI-Driven Customer Personalization: Designing Experiences to Individual Preferences
With the help of AI algorithms, you can evaluate enormous datasets of customer behavior, preferences, and purchase history. It will help build hyper-personalized shopping experiences that go beyond first-name personalization. It includes dynamic product displays, offers, and content according to individual needs. It can adjust pricing and promotions according to customer behavior, inventory levels, and competitor pricing. This ensures that customers receive the most relevant offers, increasing conversion rates and maximizing revenue. You can seek help from expert consultants to develop a comprehensive AI strategy and use it to the full potential.
Use Case
a. StyleDNA is an AI-powered app that analyzes customer style profiles and preferences, curating personalized clothing selections. Their “StyleDNA” engine forecasts what customers will love, ensuring a high satisfaction rate. The app provides outfit suggestions for various occasions, from formal to routine wear. It will help you discover items from your favorite stores and brands. A simple selfie will generate your style profile in 35 seconds, showing you the proper clothing to create a style statement.
Source: Style DNA: Fashion AI Stylist
They also have a style quiz to identify your combination of up to five style types, delivering a multi-layered style personality.
b. ASOS uses AI-powered visual search technology that enables customers to find outfits and accessories. The customer only has to upload the image from their device or take a photo through their smartphone camera. The AI-powered system evaluates the uploaded image with the help of computer vision, considering the color, pattern, texture, and style. Then, the tool compares the analyzed attributes with ASOS’s extensive product catalog to look for visually similar items. The customer will see the results in no time. They can also narrow down the search results by applying filters for size, price, brand, or other preferences.
Source: asos rolls out visual search all its uk ios app users
2. Enhancing Online Shopping Experience With AI: Streamlining the Customer Journey
i. Visual Search and Product Discovery
AI-powered visual search enables customers to discover products by simply uploading an image. It simplifies the shopping process and facilitates product discovery.
Use Case
a. ‘Lens’ by Snap Inc. lets users take a picture of an item and then returns similar products for sale from different online retailers. This streamlines the purchasing journey and improves product discovery.
Source: lens-discovery
ii. Augmented Reality (AR) Shopping
AI-powered AR lets customers virtually try on products, visualize furniture in their homes, or preview makeup shades. This improves the online shopping experience and cuts down on return rates.
Use Case
a. IKEA’s Place app allows customers to visualize furniture in their homes using AR, eliminating the uncertainty of online furniture shopping. It increases customer confidence and business ROI.
Source: Launch-of-new-IKEA-Place-app
iii. Predictive Inventory Management
AI algorithms predict demand and optimize inventory levels, preventing stockouts and ensuring timely delivery. It improves customer satisfaction and reduces operational costs.
Use Case
a. Amazon uses advanced algorithms and machine learning models to predict demand, optimize stocking levels, and improve supply chain efficiency. Amazon’s predictive analytics algorithms consider historical sales data, seasonality, market trends, and external events to forecast the product’s future demand. In addition, Amazon optimizes warehouse operations by using predictive analytics. The system predicts the products to be restocked and where to position them within the warehouse for quick delivery. It also helps in easy restocking. Through these proactive strategies, Amazon reduces overstock situations and stockouts while enhancing order fulfilment speed.
3. AI-Powered Customer Service in Retail: Delivering Instant and Intelligent Support
i. Intelligent Chatbots and Virtual Assistants
AI-driven chatbots offer instant and personalized customer support, answering queries, resolving issues, and guiding customers through the purchase process. They use the principles of natural language processing (NLP) and machine learning. They free up human resources for more intricate tasks so customers receive timely assistance. Just make sure you employ seamless integrations of AI tools with existing eCommerce platforms to deliver a unified and consistent CX. APIs and microservices are integral to these integration processes, enabling data sharing and real-time communication between different systems.
Use Case
a. Sephora offers personalized beauty advice and product recommendations with the help of AI-powered virtual assistants. Their virtual artist allows customers to try on makeup virtually and get expert guidance.
Here’s a screenshot of their Lipstick Try On Page that lists all available lipstick shades. The user can apply their favorite shade live on a webcam stream of her face.
Source: how ar helps you select perfect lipstick for your skin virtual product tryon
b. Amazon also uses Rufus, a generative-AI-powered shopping assistant. It facilitates shopping decisions by answering various questions in the Amazon Shopping app, from product details and comparisons to recommendations.
Source: generative-AI-powered shopping assistant
c. Casper has made a unique use of AI and created a late-night chatbot, Insomnobot-3000. It keeps insomniacs company when they are unable to sleep. Sleepless users text 844-823-5621 between 11 PM and 5 AM to talk to the bot about everything, whether it is their weekend plans or late-night snack cravings.
ii. Sentiment Analysis and Proactive Support
AI algorithms analyze customer feedback and social media posts to recognize public sentiments and proactively address potential issues. So, brands can get prompt resolution of the customer’s problems and enhance customer satisfaction.
Use Case
a. Delta uses AI to monitor flight status and send proactive messages to customers regarding flight changes, gate changes, or luggage issues. This proactive communication overcomes customer anxiety and improves the overall travel experience.
Source: delta teases airport screen with face biometrics for each viewers personal flight info
Wrapping Up
As AI technology continues to evolve, we can expect to see even more innovative applications in digital commerce CX. From advanced voice commerce to predictive customer journeys, AI will continue redefining how brands engage with customers. By embracing AI-driven solutions, brands can unlock new customer satisfaction, loyalty, and growth levels.
So, get ready to take the plunge and incorporate AI into your business strategy.
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As Director - Marketing, Zenul leads the marketing and branding at Krish. He brings with him an in-depth understanding of the evolving digital ecosystem and has a proven expertise and experience in strategic planning, market and competition analysis, creating and implementing client-centered, lead-gen and brand marketing campaigns. He has a heart for technology innovation and has been a keynote speaker on various platforms.
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