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Accenture suggests that the core of retail strategy is a 720-degree view of customers — reaching digital natives with rapid focus shift, high expectations, and growing demand for personalization and perks. Successful examples such as Amazon, Macy’s, and Walmart prove that the way to reflect and interpret this view goes through experiment and innovation. In particular, the use of AI and its integrals includes data mining, machine learning, natural language processing (NLP), and bots.
But how is AI a good match for retail? Here are three advantages.1. AI can extract value from massive data sets
Industries have been struggling to build data-driven strategies for a while. According to the numbers from the last year McKinsey research put out, retailers were second in this race. Retailers are lucky enough to collect and own massive data about customers and buyer behavior. However, they have been unable to transcript this data properly.
According to the research, retailers extract value only from 30-40 percent of existing data. That leaves two thirds of data wasted due to a lack of process, technology, and analytical talent. Besides, most of the data stays “siloed within companies.”
Improvements in machine learning and, most importantly, data availability help retailers unlock the full potential of customer data. On one hand, a regression model allows a retailer to leverage legacy data and reuse it effectively. On the other hand, predictive capabilities of machine learning let retailers not only learn from experience, but also apply those insights in order to model and predict future buyer behavior. It’s a true virtue to know what customers want before they want it.
Example: Walmart uses machine learning to predict what its ecommerce shoppers are likely to buy. Thus, the retailer provides focused recommendations based on past customer behavior. This is what the VP of customer experience engineering at WalmartLabs calls “the bridge to enhance online shopping experience.”
2. Customers need to be understood
The market of in-messenger and voice assistants is growing. The results of the 2017 Prime Day sale let Amazon claim Echo Dot as its best-selling product.
At last, people gain the power to speak with digital systems using natural language thanks to…
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