Top 5 Things Retailers Need to Unlearn about AI for Business

AI has already invaded many industries, but how does it benefit retailers that are declining in the face of e-commerce growth?

The retail apocalypse began around 2010. The growth of e-commerce and the rise of the Internet shopping led to the rapid extinction of brick-and-mortar retail stores. Online businesses became increasingly competitive and started ousting traditional stores at light speed. The most vulnerable shops appeared to be luxury and clothing brands many of which declared bankruptcy and closed the majority of its locations.

To date, there are about 2 billion online shopping sites, with the US having the highest total revenue from the Internet sales. The competitive edge of web shops is rooted in technology advances that are intensively adopted by e-commerce product owners. The need for technology adoption is linked to the changes taking place in consumer behavior. People are no longer willing to do conventional shopping because it is a lot more time-consuming and burdensome than buying online. Consumers opt for simplicity and fast delivery that traditional shops cannot provide.

However, the remaining retail stores still have a chance to live out this fierce pressure from online shopping on condition that they will integrate AI marketing tools with their business. Though the retail business is at high risk, retailers can catch up with web shops by using AI for business.

These are 5 basic ways of how AI benefits the retailing business.

1. Better in-store assistance

AI shops are the future of traditional commerce. The right application of technology can help brick-and-mortar retail stores stop being overly conservative and engage more customers in their brands. For example, one of the most brilliant retailing business ideas is to make retail stores cashier-free. This innovation allows retailers to reduce the number of staff and lets customers feel at ease when checking out. Amazon Go works like that. This AI tool is designed to detect items that a customer takes from shelves. When a customer leaves the store, Amazon Go uses takes automatically money for your purchase.

Similarly, many smart stores feature robots that assist customers in finding the right products or clarifying a price tag. They operate in many languages and thereby suits both domestic and international shoppers.

Retail stores may also decide not to introduce these in-store innovations, but in that case, they need an alternative enhancement in the form of a chatbot that fulfills the function of customer assistance. The chatbot is the most reasonable application of AI for small business, particularly for those enterprises that lack highly qualified employees with decent retailing skills.

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2. More effective logistics

One of the principal causes of why many brick-and-mortar stores are dying is poor retailing management. Compared to human intelligence, AI tools show a higher degree of accuracy of calculations regarding marketing trends, purchasing and supply management, as well as predictions for the future. The use of AI software in logistics leads to smaller losses from bad decision-making and erroneous forecasting. In particular, AI excels at setting the most advantageous pricing strategies that build on a history of sales, promotional campaigns, etc. Therefore, your business development can be backed up by AI instruments without having clear signs of using it in your store.

The interweaving of AI and marketing also seems beneficial when it comes to product categorization. When a customer cannot find some goods, they can upload an image of what they need and AI recognizes it in a blink of an eye. This technology is a must in extremely large supermarkets that are challenging to navigate, and for this reason, all customers tend to experience dissatisfaction when they fail to get to the right product within 10 minutes of being in a retail store.

3. Comfortable search

Knowledgeable sales associates state that visual search is now ranked third among the most used channels of search and expected to grow rapidly in the next five years. Today’s AI tools can recognize any product and show the right results in 95% of image recognition searches.

Along with the visual search, plenty of customers regularly use voice search on their mobile phones to get the desired thing quickly. The leading multinational retailers like Walmart and Tesco incorporated this technology long ago, while the majority of smaller retail shops are still on the fence.

4. Control over customer satisfaction

Another reason why brick-and-mortar retail stores should get along with AI is that it helps to monitor customer satisfaction by analyzing people’s facial expressions. These data play a key role in learning customer behavior and understanding the basic needs of an average consumer. Based on AI analytics, retail specialists can develop strategies for building positive brand awareness and strengthening customer loyalty. Similarly, this information gives an insight into the weak spots of a retail shop that can be further improved or eliminated.

5. Maximum personalization

There are many marketing strategies, but none is really fit for your business because each enterprise has a unique way of development. Here, AI software benefits retailers best and allows making up the most effective retailing business plan with regard to a company’s strengths and weaknesses. In particular, AI takes into account many factors such as product configuration, consumer behavior, competitors’ influence, etc. and creates a perfect algorithm that will drive your business forward very quickly.

At last, AI application is followed by a decline in costs that you typically spend on running your business smoothly. It contributes to sensible and fault-free management that promotes your company’s growth on the global market.

Is AI a remedy against the retail apocalypse?

Artificial intelligence companies are at the core of innovation and progress. The future of retail is intrinsically tied to AI technology. Since the beginning of the retail apocalypse, many famous retailers went down in history because they failed to overcome the ordeal of online shopping sites. And although many retail stores are still not familiar with the advantages of AI tools, their rivalry with e-commerce will soon urge them to embark on the adoption of AI software.

As far as consumer behavior is largely dependent on technology advancement, the retailing industry changes its rules and requires the integration of automation tools that simplify the process of decision-making. The success of many global online retailers proves that the use of AI for business decisions is no longer desirable but obligatory for any trading enterprise, whether online or brick-and-mortar.

To date, AI software is indeed the best remedy for keeping conventional retail stores in the game. They may be reluctant to adopt it, but the scenario is one-sided: either retail stores befriend AI technology or they are bound to lose to it.

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