Consumer demands are becoming increasingly sophisticated. Two thirds of customers now expect an individualised experience from retailers, in which they’re presented with up-to-date and relevant product suggestions whenever, wherever and however they choose to engage.
Only two in five retailers are currently in a position to deliver such an experience, however. Many may believe they don’t have sufficient data, for example, or don’t have the right type of data for the insights they need into a customer’s preferences and buying habits. But artificial intelligence (AI) is set to prove them wrong.
AI is reshaping the retail industry, encouraging new ways of attracting customers and enhancing their shopping experience. And, by enabling retailers to personalise their experience, ultimately, retaining their customers’ loyalty.
A data goldmine
With thousands, or even millions, of customers visiting their sites every month, retailers are sitting on a goldmine of data. From purchase history to recently viewed products, and from information on location to device used, when properly analysed, this data will provide them with valuable insight and intelligence.
By knowing, for example, that a customer is viewing the same product a number of times in the same day, and that they’re doing so on their mobile, the retailer has an opportunity to make similar recommendations that could lead to new purchase activity, while ensuring they’re providing that customer with the best experience for their platform of choice. Access to this level of information, and the ability to understand what it means to a customer on a personal level, will both empower the retailer and improve the overall experience for that customer.
Powered by AI
As it stands, the majority of retailers will personalise their online experiences using a rules-based model. They’re able to create multiple tests, across various segments, for anyone they like. But this still requires some level of human management. An individual or team will need to oversee the results of these tests, using them to inform their personalisation strategy and metrics in order to best suit their customers. In many cases, this process can leave retailers overwhelmed by the amount of data and what they’re required to do with it.
Employing AI, however, changes everything. Personalisation platforms, powered by AI and machine learning, will evaluate hundreds of visitor data points, identifying the most fruitful data – in real time – which brands can use to individualise product recommendations that best suit a customer’s particular preferences and needs.
While someone will still need to set up the initial rules, an AI solution can act alone, gathering invaluable insights into customer behaviour and shopping patterns. In addition, it will also be able to switch experiences in real time. Customers will then see products and web pages that are relevant to them at any given moment, wherever they are, and on whichever device they’re using, for a truly personalised retail experience.
Giving the customer what they want
Processing the vast amount of data available to them can be daunting for retailers. And, while AI may not be a panacea, it can certainly assist in making sense of large quantities of data, and finding the details that will help them to deliver a more personalised experience, in real time. What’s more, being self-functioning, AI will also save retailers time and money.
However, according to a recent report from Microsoft, retail is lagging behind other industries in its adoption of AI technology, with less than half of retailers integrating it into their operations. With so much data available to retailers today, it would seem only logical for retailers to adopt AI solutions that will help them make sense of it.
More than two thirds of consumers now want an individualised experience and, if they don’t receive one, they will look elsewhere. By not taking advantage of AI’s ability to deliver this, retailers may soon find themselves losing out to their more forward-thinking competitors.
Simon Farthing, Director of Global Strategy & Insights, Monetate
