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7 Effective Strategies to Use AI in Ecommerce

May 26, 2023 | Author:  Andrew Maff
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ChatGPT’s launch marked a new phase in artificial intelligence (AI), gaining 100 million users in two months. It has become an indispensable tool in many industries, including eCommerce businesses. There is so much we can do with customer data using artificial intelligence.

AI tools have been in the eCommerce industry for a while, and there is a high chance you’ve used one without knowing it. Those eCommerce companies you have an online store with have most likely implemented AI solutions. However, you are steps away from boosting your eCommerce business by actively implementing artificial intelligence.

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How can you make leaps in your sales with AI technology available for eCommerce businesses? We’ll answer that in subsequent sections of this article to help you build a formidable strategy. With that in mind, here are our thoughts on using artificial intelligence in your eCommerce business.

7 Strategies to Use Artificial Intelligence in E-commerce

Whether integrating AI technologies into content marketing or predicting inventory levels, artificial intelligence is ready to do more. You’ll miss out on this eCommerce industry, which is expected to reach $6.3 trillion in 2023. So, here is how we recommend online retailers use artificial intelligence:

  • Automate repetitive tasks.
  • Manage inventory
  • Personalize the customer experience while shopping.
  • Provide 24/7 customer support.
  • Manage tasks with virtual assistants.
  • Optimize marketing campaigns.
  • Fraud detection

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Task Automation

Repetitive tasks like data entry can drain your energy and time, especially if you are a sole proprietor. This time will eat into your marketing efforts, give you time to meet customer demands, and maintain an efficient sales process.

To give you an idea, industries might lose trillions of dollars to repetitive tasks. Incorporating artificial intelligence to automate these tasks frees up time for other things. You can focus on other areas that affect the customer experience on your platform.

Task automation covers the entire eCommerce business. You can integrate AI technology to automate the following:

  • Inventory management
  • Get reviews after a purchase.
  • Segmentation based on customer behavior
  • Send emails for abandoned carts.
  • Schedule posts on social media channels.

The list goes on and on, provided you recognize the tasks that need automation. Let’s take email automation as an example. We know how effectively emails improve eCommerce businesses' customer experiences.

You don’t have the time to draft emails for each customer, whether a returning one or a prospect. AI technologies with machine learning algorithms can recognize customer behavior from data and send appropriate emails. Things like past purchases and customer preferences when browsing your eCommerce store can be helpful when emailing.

E-commerce AI with machine learning algorithms goes beyond recognizing triggers and sending pre-written emails. They can modify messages to fit customer behavior.

Personalized emails are more likely to drive your profits, as studies show that companies with personalization have 40% more revenue. Fortunately, you can find several email AI tools for eCommerce retailers.

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Inventory Management

Out-of-stock (OOS) is a menace for eCommerce businesses. It costs businesses globally $1 trillion every year but can also cost you customer loyalty. Still, it is challenging to tell when your stock levels are low manually.

AI in eCommerce can be helpful in inventory management. However, it can do more than notify you of falling inventory levels. Predictive analytics can forecast customer demands, telling you which products to stock up on.

With demand forecasting, you’ll spend money on needed products and improve customer satisfaction and loyalty. That saves you money and time.

Machine learning models can run predictive analytics on extensive customer data quickly. This capability is necessary with inventory management at the heart of eCommerce businesses.

Here is what artificial intelligence can do in inventory management:

  • Monitor stock levels.
  • Predict customer demands.
  • Advance preventive maintenance for higher operational efficiency
  • Analyze customer behavior regarding fulfillment choices.
  • Supply chain management
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Those are a few areas where you can use AI algorithms. Another one is writing product descriptions for thousands of products. It is easier to do that with artificial intelligence, but it doesn’t stop there.

Artificial intelligence AI can write and update these descriptions based on customer interactions. It can detect underperforming descriptions on eCommerce platforms and rewrite or edit them.

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Personalized Shopping Experience

Personalization is a critical factor in increasing sales in eCommerce stores. This ranges from things like product recommendations to customized promotions. Moreover, customer engagement is higher when the messages (emails, ads) are personalized.

Machine learning technologies can review purchase history faster and predict customer behavior. These valuable insights from artificial intelligence make a difference in customer engagement.

Besides recommending products, eCommerce AI can also personalize brand content. Hence, customer experiences will be unique based on their behavior on or off the eCommerce stores.

Adobe Experience Cloud is a famous customer personalization AI in eCommerce. On a broader scale, you can achieve the following:

  • Explore customer intentions better.
  • Automate offers that help in closing sales.
  • Optimize content to match what your customers prefer.
  • New call-to-action
  • Follow and adapt to customer behavior during the purchase journey.

Website personalization is another critical area that can boost customer engagement. You can use AI in eCommerce to customize product pages, catalogs, navigation, cart pages, offers, and discounts. 

Customers interact better with eCommerce websites that personalize their content. It could be placing recommended products based on their previous purchase data or search optimization.

Implementing image recognition software in product mapping is another way to use artificial intelligence in eCommerce. Pinterest is an example of a platform that uses image mapping. Hence, you can integrate it into your eCommerce store to quickly help customers find products or details.

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Customer Support: Chatbots and Virtual Assistants

Customer queries are nothing new to online shopping experiences. You may receive them anytime, even when you’ve mentioned your business hours. Prompt responses enhance the customer experience and place you in their good books.

You can’t reply to dozens of customer inquiries manually. How much staff do you need to accommodate these queries and provide efficient customer service? While the human touch is vital, using chatbots for quick resolutions can be time and cost-effective.

Natural language processing (NLP) AI algorithms can interact on a human level, responding to queries. They can also sync with other AI algorithms to make product recommendations in these chats. However, you must understand the pros and cons of chatbots.

Utilizing AI in customer service can help you provide 24/7 customer support and improve customer satisfaction. This competitive edge can increase repeat purchases, customer loyalty, and overall sales.

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Manage Tasks with Virtual Assistants

Virtual assistants are making their way into many eCommerce businesses. They not only answer questions but can also execute user tasks because of their artificial neural networks. Here are a few examples of tasks that a virtual assistant can do for you:

  • Order and shipping processing
  • Update pricing information
  • Social media management
  • Optimizing product listings

The capabilities of virtual assistants in the retail industry grow every day. You can also integrate them to help your customers during their shopping. For example, a shopper can use them to find deals quickly.

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Optimized Marketing

We have AI tools that can generate compelling sales copy in minutes. Besides upping your game in sales, you can use artificial intelligence in omnichannel marketing. These are the ways you can use them in your marketing efforts:

  • Writing sales copies
  • Omnichannel marketing
  • Content optimization on social media
  • Optimize email marketing.
  • Offer dynamic pricing

Omnichannel marketing creates a seamless customer experience, allowing customers to see products that align with their interests. That involves blending your marketing across various channels, including emails, social media, websites, SMS, etc.

Take a user’s product search for an iPhone on Google as an example. E-commerce AI algorithms will pick that up and send iPhone ads to that user on different platforms. Subscribers to your eCommerce store can also receive email deals.

Customer relationship management tools today use artificial intelligence in eCommerce. They can quickly run A/B tests on ad copies to determine the most effective. Then, they’ll double down on the effective ones without your intervention.

AI algorithms can also capture customer feedback during online shopping and optimize marketing campaigns. That simplifies the process of optimizing deals and product recommendations in the ads.

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Fraud Detection

E-commerce merchants lost over $41 billion to fraud, with the numbers growing daily. That makes having efficient fraud detection software critical for eCommerce business owners. Fortunately, a few, like Signifyd, are available for eCommerce fraud and chargeback protection.

These computer programs use the following for fraud detection and prevention:

  • Supervised and unsupervised machine learning
  • Humans-in-the-loop

Incorporating artificial intelligence AI in eCommerce fraud protection is both time- and cost-effective. It spares you from spending on human resources to detect fraudulent transactions, which may need to be more efficient.

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Conclusion

There are many ways to use artificial intelligence in eCommerce. The key is recognizing areas that will be the most effective, improve business operations, and result in higher customer satisfaction. We’ve identified a few: repetitive tasks, inventory management, customer support, task management, marketing, etc.

E-commerce business owners can apply artificial intelligence AI to themselves or their customers. Task automation and management are effective strategies for using AI in your operations. Conversely, you can give your customers a better shopping experience and 24/7 customer support.

Besides increasing customer satisfaction, AI can save time and money for eCommerce retailers.

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