What’s the one thing the customers have always yearned for in their retail journey?
A smooth shopping experience.
Gone are the days of bland product descriptions and one-size-fits-all product recommendations.
The rapid digital transformation in the 21st century has increased the efficiency of every retail branch. In more recent years, one technology has stood above and beyond everything to make this possible:
Artificial Intelligence.
Once AI hit the mainstream in late 2022, it took little time for retailers to understand the potential in front of them. AI in retail has undoubtedly made its dent in the modern world. It has empowered businesses to explore brand-new ways to engage with their digitally savvy shoppers and take CX to the next level.
This is just a fraction of what AI can achieve, so it’s no surprise that modern retailers are embracing AI to stay competitive.
The use of AI in the retail industry is projected to reach 164.74 billion USD by 2030. Retailers have increasingly sought artificial intelligence to add innovative shopping features and experiences to their business. Just look at this report by Statista which confirms that retailers using AI in retail have outperformed their competitors.
Retailers cannot just plug in AI and expect wonders.
Let’s study some practical approaches where AI has the greatest impact.
AI in Retail Playbook: 4 Most Valuable Use Cases
Price Optimization
If there’s one thing that entices customers every time, it’s the discounts and offers.
To succeed in the modern world retailers have to persistently adapt to the pricing strategies.
This is where AI comes into action. It can adjust the prices of products in real-time based on demand forecasting, competitor prices, shopper behaviour, and inventory.
Dynamic pricing enabled by artificial intelligence has helped retailers to:
- Encourage repeat purchases
- Increase brand loyalty
- Maximize profits.
Demand Forecasting
Imagine how effective it would be to plan product launches based on precise demand forecasting.
AI-infused demand forecasting technology is the need of the hour. It sifts through vast amounts of data in the form of sales history, current market trends, and emerging trends in the near future and combines them with supply chain analytics to generate accurate demand predictions for products in the retail business.
This helps retailers with:
- Minimizing waste
- Limiting overproduction
- Boosting sales
Personalization
Hyper-personalization is not just a trending topic, it’s a game changer in the retail world. The growth of quick commerce has made hyper-personalization a need rather than a luxury.
For example, when a customer visits any online store, AI integration ensures the shopper is greeted with a message and a personalized offer based on his or her purchase history.
Taking customer behaviour and preferences into account, AI can enhance CX by tailoring a personalized shopping experience to customers’ interests based on their browsing and purchasing habits.
Artificial intelligence groups these customers based on similar buying and behaviour patterns and, by analyzing this customer segmentation, recommends products or content that aligns with customer preferences.
This tailor-made experience leads to higher conversion rates.
Supply Chain Management
With effective supply chain management retailers can:
- Reduce human errors
- Maintain optimal inventory levels
- Speed up operations
Retailers have been integrating AI into different supply chain functions such as transportation logistics & supplier management to decrease cost and increase visibility. AI in retail optimizes transportation routes to reduce delivery times and plays a critical role in backend operations for inventory optimization.
Walmart uses AI in supply chain management to route the delivery vehicles into a more efficient path by analyzing traffic and weather patterns to ensure on-time delivery.
Want to stay one step ahead in this AI-driven competitive market?
Hire our experienced AI Engineers.
How Does AI in Retail Benefit Me?
In both retail arenas – offline and online, AI-driven tools are making retailers’ lives easier and enticing customers to come back for more.
Adopting the hottest and possibly the most innovative modern technology sure comes with its perks.
Better Decision Making
With the explosion of data and the advent of technologies such as AI, it’s high time retailers start taking advantage of this to enhance their decision-making capabilities.
AI in retail helps industry leaders analyze huge amounts of real-time data across operations, sales, and marketing. This enables them with more data-driven decisions around product development, marketing, pricing and inventory.
Synchronize Digital & Physical Retail
If you think despite the onset of e-commerce stores, physical stores are on the decline?
Think again.
46% of customers according to PWC still want to touch and test the products before purchasing.
AI in retail helps to synchronize both online and offline retail operations, providing shoppers with a seamless CX and retailers with increased operational efficiency.
Low Cost. High Profits
Who doesn’t want savings as a significant part of their business operations?
AI in retail automates the tedious supply chain processes that have a major impact on the retailer’s bottom line. AI-integrated inventory management reduces the cost of holding excess stock and allows retailers to adjust prices in real time to grow profits and get ahead of competitors.
Customer Satisfaction
Ever looked at offers and thought, if it was created just for you?
AI helps retailers achieve a higher customer satisfaction level by simply creating personalized offers and messages for customers. AI-integrated stores can help retailers decide which incentive will influence specific shoppers at a personalized level.
Retailers can also integrate AI-based chatbots to help shoppers get quick answers to any questions regarding products.
How Does AI Fit Into My Business?
It’s the one question you should be asking yourself to take immediate advantage of this emerging technology.
Growexx is the world’s leading AI consultant. Be it AI in retail, banking, healthcare or any other industry, our AI consulting services will help you to aim for and achieve the epitome of AI sophistication, where you can leverage AI-driven insights to make data-driven decisions.
Click here to book your consultation today.
