Will AI change the retail industry? What you should know

  (photo credit: INGIMAGE)
(photo credit: INGIMAGE)

The retail market is an ever-changing landscape. Right now, what is relevant to customers may lose its meaning and usefulness in just six months. Interests shift, and so do consumer preferences. Then it is up to the retail giants to determine how to build a loyal customer base. 

Specialty Retail discusses different retailers' approaches to winning over potential buyers. From deals and discounts to shopping hacks that buyers can employ to save money, every prominent business like Walmart, Walgreens, Target, or Costco is thriving to succeed amidst the tough competition. 

One thing that the world of retail is turning to as we speak is the use of Artificial Intelligence and Automation to drive sales, handle orders, and manage the market more efficiently. 

We Can Expect AI To Take Over Some Job Positions 

The research and development sector for any retail business may experience shrinking. AI can help management determine market trends, product usability, in-demand products, etc. Therefore, a retail company may not have to invest heavily in R&D. 

Moreover, many retailers are already using AI to relieve some pressure on employees when short-numbered. One hot area is that of customer service and support. Retailers now use automation to answer common customer questions and complete various online actions instead of recruiting designated staff to handle these tasks. 

Personalized Recommendations Are Here To Boost Customer's Shopping Experience 

You may have noticed this when shopping at your favorite retailer by using mobile banking apps recently. For example, I purchased multiple bakery items and dairy products last month. Surprisingly, the majority of the recommendations that I now get circle around these purchases. 

This is another approach to how retailers plan to engage with customers and how AI proves significant. Keeping in perspective what a particular buyer often gets, online stores prepare a list of suggestions and insights to streamline their shopping experience and save time. 

The data generated to do this is gained through AI. The technology is helping retailers understand customer preferences. It is the sole driver of an increase in retail revenue of about 10% to 15%. 

AI Can Also Help Organizations Bring Down their Cost

Hold your horses as I explain how that is possible. 

We discussed how AI could help retailers & mobile apps like venmo that determine customer preferences and which products are in demand. Consequently, this information can be used to only invest in products/services bound to score a profit. On top of that, AI can review consumers' previous purchases and alert retailers when it is running low on any of the best-selling products. 

Moreover, AI can automate mundane tasks and optimize more demanding work such as tracking orders, scheduling delivery, etc. The advancements can eventually make jobs easier for employees. 

By simplifying how a brand identifies seasonal item trends and estimates when a product or a service will be highest in demand during the year, the only thing left to do is mobilize the employees to work by AI guidelines instead of manually scrutinizing the trends and doing hefty paperwork. Ultimately, businesses can have fewer employees working on more essential tasks as AI handles its side of the job. 

AI Is Not Just Online! The Advancement Is Helping Retailers In-Stores Too

You heard me right! AI also means lesser assistance needed in stores as it is efficiently helping companies in this field. 

Let's take a look at an example. We already know that almost every store now has a CCTV camera installed for security. However, it is a hassle to scrutinize the recordings to identify any suspicious activities. This is where AI steps in. With the help of efficient AI-integrated systems, the software can pinpoint where camera footage may have an interesting recording to notify the relevant employee immediately. They can then take a look specifically at that segment and proceed to take necessary measures. 

A handful of retailers also use AI to track customers' dwell time. This refers to a person's minutes standing in front of a shelf. It can determine the game time, too, which means the number of minutes a person spends looking at an item. These measures obtained through video analytics can be helpful as they allow retailers to understand their customers and engage with them for better conversion rates. 

Undoubtedly, we will see more AI-integrated tools in the future, and retailers will rely on AI more heavily for research, management, and even pricing of their products. Since AI is efficient and accurate, the retailers utilizing it correctly will be able to provide enhanced customer experiences. 

This article was written in cooperation with Research Prospect