Rewriting The Retail Industry Paradigm Through AI
Artificial Intelligence have been playing a key role across the retail industry. Offering better efficiency, velocity, and accuracy across branches of retail business. AI in retail has empowered businesses with better data that is leveraged into advanced retail operations and unlocked business opportunities.
AI has the ability to transform the traditional retail experience with personalization, automation and increased efficiency.
There are five primary benefits of AI that retailers can start to explore in the following illustration:
The potential for AI and machine learning in the retail industry will be determined by the following factors depicted by the Harvard Business review:
Identifying use cases core to business strategies in which AI can deliver the maximum impact will determine the success of AI.
Creating an environment where humans and machines can peacefully coexist and machines are leveraged to amplify human ingenuity will accelerate adoption.
UNIFIED DATA FOUNDATION
To realize the full benefits of applying AI and machine learning to data, retailers must build a consolidated data foundation that will enable them to analyze, sense, and act on large volumes of heterogeneous data like voice, text, and images.
Demystifying AI and helping board rooms understand what AI can and cannot do are critical to making AI a foundational enabler of business strategy
A systematic approach to handle oft-cited pitfalls of AI, such as data sufficiency, ethics and bias, and societal considerations, is important to pave the way for frictionless adoption of AI.
Implications of AI in Retail
Personalization & Customer Insights
Intelligent retail spaces recognize shoppers and adapt in-store product displays, pricing, and service through biometric recognition to reflect customer profiles, loyalty accounts or unlocked rewards and promotions — creating a custom shopping experience for each visitor, at scale.
Stores are also using AI and advanced algorithms to understand what a customer might be interested in based on things like demographic data, social media behavior, and purchase patterns. Using this data, they can further improve the shopping experience and personalized service, both online and in stores.
Brands that create personalized experiences by integrating advanced digital technologies and proprietary data for customers are seeing revenue increase by 6% to 10% — two to three times faster than those who don’t,” according to a study by the Boston Consulting Group
What are Some of the Immediate Benefits of AI
People counting – How many people visit the store and how long do they dwell.
Sales data analysis
Buying pattern analysis
Analyzing customer behavior
Customer trend analysis
Consumer demand analysis
Supply chain movement analysis
What are Some of the Immediate Applications of AI
Identify the changing preferences of customers so you can adapt to meet their expectations
Identify where improvements can be made in your supply chain
Identify current consumer trends and whether there’s an opportunity for you to innovate in this area
Use sales data analysis to make meaningful improvements to your sales approach, pricing, and marketing
Use insights found in customer behavior analysis to determine whether you should make key changes to improve the customer experience. Does the layout of your store need to change? Do customers use your product in the same way? Do they use it in the way you intended it to be used?
Optimize inventory and procurement – Use predictive analytics to determine which products to stock and in what quantities.
Page Acknowledgments: Hitachi, AI Superior, Harvard Business Review