Retail needs to double down on Artificial Intelligence to stay relevant
The biggest transformation catalyst that retail faces in the 21st century is the advent of digital and AI technologies. One of the recent IBM studies states that 85% of their responders believe that AI will transform more than one aspect of their business. Be in supply chain management or demand forecasting or pricing and promotions, retailers believe that AI is here to stay and transform the business like never.
While traditional retail was confined into the boundaries of brick and mortar, mobility has changed customer attitudes and shopping behaviors. Huge operational expenditure in maintaining retail stores combined with a threat of disruption from online retailers can only be countered through the ingenuity of AI.
With AI enabled retail strategy, the disadvantage of maintaining retail space can now be converted to a winning mantra. The user experience of buying a product can be enhanced by harnessing technologies such as Augmented reality. Similarly, brand personalization, targeted product promotion, and meaningful product promotion can be achieved through effective use of AI.
Transforming retail space
With the advent of digital market platforms, the traditional Brick-and-mortar retail is clearly under the pump. But retailers have a huge advantage when it comes to the physical connection with their customers. Combining customer lifecycle knowledge with AI, retailers can improve efficiencies and the experience of shopping.
With AI by their side, retail professionals can now harness the power of self-adapting algorithms that record and learn customer behaviors including their spending pattern. AI can also contribute to the success rates of personalized, targeted brand promotion by integrating social media and other such channels and help retailers get ahead of trends and competition.
For instance, Adidas have integrated AI into their physical store presence as a lever and thereby have created a seamless user experience between online and on-shop channels.
It’s all about knowing the customer
Traditional retailers have always used personalization and physical recognition as a mode to improve customer experience. But how do you scale it up for hundreds and thousands of customers coming through multiple channels and each with a different need and different taste? AI comes to the rescue.
With AI, retailers can now harness and get meaningful personal insight into individual customer experience and thereby improve their brand presence and loyalty. Recent studies have concluded that retailers providing personalized shopping experience are more likely to convert shoppers and retain them for future business.
For example, Sephora leverages machine-learning-driven in-store product that scans the surface of a visitor’s skin to provide a personalized product recommendation.
Data- Velocity, variety, and volume
Retail is not confined to the stores only and has spawned out to multiple channels and multiple sales and marketing streams. Naturally, these various streams and channels generate voluminous data at a speed which is manually incomprehensible.
What smart business need is customers insight, store foot traffic analysis, store employee motivation, social media brand presence, and engagement. These features give retailers the ability to make data-driven decisions that take their physical and online environments into account. Thereby delivering customer experiences that convert more of their traffic into revenues and minimize line abandonment.
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