We all experience machine learning without even realizing it. If we have an Alexa; we ask questions of Siri; and these personal assistants are machines that continue to learn, as new questions are asked and they are able to process language into patterns and ultimately provide good answers.
But machine learning has more applications than just personal assistants. It has major implications for e-commerce, with the potential to make businesses more competitive in their niches. After all, e-commerce grew to about $2.774 trillion, as 2018 came to a close.
Here’s how machine learning will transform e-commerce.
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Customer Experience
The biggest disruption of machine learning in providing customer experiences is personalization.
Consumers want a personal experience with a brand, and, more and more, they are demanding it. They want communication and content that is relevant to them alone. Artificial intelligence and machine learning offer this. They can “remember” information about each customer, can group customers together based upon their purchasing behaviors and other demographics, and can recognize those customers when they come back, greet them by name, etc. They can make suggestions based upon historical preferences.
All of these things signal to a customer that they are recognized and valued as an individual.
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Search Results
What business owners want is improvement in search results. Machine learning is used to produce the most relevant search results when a customer lands on, and especially returns to, an e-commerce website. This is especially helpful to businesses that offer a variety of products. The most relevant results can be presented to a potential customer, when the machine remembers their behavior when last on that site.
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Re-Targeting
Businesses can collect important information about consumers when they either browse through their sites online or in a physical store.
Currently, artificial intelligence tracks customer behavior online and the presents each customer with targeted ads based upon that behavior. We have all experienced this.
But the future of AI will involve far more than this. Facial recognition and in-store behaviors will be identified and remember. Consumers may soon see online based upon what they have looked at in physical stores.
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Image Recognition and Editing
This is rather a cool development. If a customer is looking at something in a physical store, devices such as Pinterest Lens will allow a consumer to take a picture of an item he is looking at and an immediate search will begin to pull up that item where it is online.
And it will go even further. Researchers at the University of California, Berkeley and Adobe are working together on a tool for image editing. With even a sketch of a product, AI will then create a more realistic image that can then be used for a visual search.
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AI and Voice Searches/Product Recommendations
We have already experienced this function in a basic way. We can launch a voice search via our smart phones. For example, we can search for ceiling light fixtures, and Google will provide images and sites where we may find them.
Artificial intelligence will take this a step further. Based upon patterns of shopping behaviors (through analysis of data, algorithms will churn our customer data from all over the web), AI will provide predictions of what customers actually want. E-commerce businesses can literally provide virtual personal shoppers, based upon asking the right questions and then suggesting the right products.
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Elimination of Fraud
Certain industries are major targets for fraud – travel, airlines, insurance, and even retailers. Credit cards are stolen, and large purchases can be made before the situation is discovered and reported.
What artificial intelligence can contribute is this: It can identify patterns that seem to be normal and those that do not, based upon gathered data, and then provide alerts when anomalies occur.
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Pricing
Gathering as much data about pricing and purchasing behaviors related to pricing can help ecommerce business owners select the ideal pricing for the maximum appeal to customers.
Conclusion
Obviously, there are a wealth of benefits to using AI and ML in the ecommerce industry. Some are already in use; others are just on the horizon. As the technology continues to evolve, businesses will continue to reap the rewards.