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How AI is pushing the e-commerce cart forward

Sanchit Khera
7th Dec 2017
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The next time you place an order on an e-commerce platform, take a moment to pause and think about the technology that comes into play to get your delivery to you in time. From order processing to assigning delivery routes, the entire process is increasingly powered by basic Artificial intelligence (AI) functions. Now, more and more e-commerce platforms are using AI to understand consumer behaviour better and leverage it to make the online buying process even smoother for you.

Image: Pixabay

Why AI?

E-commerce and AI are like partners that fight redundancies and errors in real-time. They are like Batman and Robin, working together to figure out what drives the decisions we make while we search, interact, and place our orders on these platforms. So what exactly does AI have to do with online purchases? Everything. If a computer can figure out what you’re seeking before you even ask for it, that’s a win-win situation for the retailer and you as a consumer. AI can make the shopping process a lot more intuitive and smoother, from giving recommendations that are personalized to your needs, to receiving future promotions based on your activity on the website when you last logged in.

According to a report by management consulting firm Zinnov, there were nearly 170 AI-focused startups in India by the end of 2016, with a tenfold increase in investor funding between 2011-2016. This is a veritable treasure trove of organisations working with AI, Machine Learning, and data analytics which e-commerce players can tap to improve their offerings.

On the B2B side of things, there are already startups working with major e-commerce channels to streamline logistics and warehousing to allow for quicker deliveries as well as predict surplus/deficits in time. However, it’s on the B2C side that things get quite interesting.

AI for B2C businesses

Many e-commerce sites have redesigned their homepages to personalize them (at some level) for all their millions of shoppers. Machine Learning understands various patterns and shopping behaviours of visitors to these platforms, aligning them to visit frequency, shopping wallet size, etc., to make more accurate predictions for future recommendations. This technology houses millions of data points and creates reports in seconds, as well as revealing which product is trending more than the others. All of this helps e-commerce channels optimize their offerings further and create profitability that’s margin-independent.

However, the power of AI goes beyond just analysing purchasing patterns and consumer behaviour. For example, certain design houses are using AI to understand what to create in upcoming collections. AI can track whether a certain design, collar, or fitting is popular in a certain location and then create new data points and insights to help designers. Now e-commerce designers can quickly create new designs based on the statistics shared by the AI tech and create designs that are even more consumer-friendly. There isn’t even any need for consumers to fill out a form or answer survey questions. In fact, their entire history of interaction needs to be purely limited to “what they clicked” and “where they clicked”.

AI can also quickly differentiate between strict and flexible keywords, and based on the search history of the visitor, help showcase the highest quality search results. Beyond this, consider aspects such as what kind of advertising to showcase, what kind of content to introduce to customers, what kind of add-on packages they’ll appreciate, etc. AI and Machine Learning are able to analyze consumer behaviour to answer all these questions, making it possible for e-commerce retailers to understand what you will like even before you know it, and offer products accordingly.

The future

The debate about whether AI and Machine Learning will change our world forever is moot today. The future is here. Now the debate is about the success and potential of this technology in implementation in key markets such as e-commerce, trade, and finance. In the e-commerce space, Indian startups have taken the lead in terms of providing real-time insights, recommendations, content, designs, etc., to e-commerce platforms. All in all, the future of AI-powered e-commerce in India will definitely be exciting and worth watching.

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