Application of artificial intelligence enables a breakthrough experience to customers
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Application of artificial intelligence enables a breakthrough experience to customers

With the ability to serve customers in real time and provide insights into customers, Artificial intelligence is being applied in the retail industry to enhance customer experience.

The role of customer experience to retail businesses

A study by Walker showed that, by the end of 2020(1), customer experience will surpass prices and product quality in the task of developing new customers and retain loyal customers for businesses. Understanding and focusing on customer experience is the first and foremost basic step for every business to enhance customer experience. Through the help of artificial intelligence, retailers can serve customers quickly, while at the same time, bring satisfaction to customers.

How AI helps businesses improve customer experience?

The term AI is not new in recent years. AI stands for Artificial Intelligence. AI technology is understood as the intelligence of computers created by humans. Artificial intelligence can think and learn like human intelligence, while process data at a wider, more systematic and faster rate than humans. With these advantages, AI is being applied in the retail industry to enhance customer experience in many facets.

Serve customers as quickly as possible

Many companies have integrated chatbots and virtual assistants on their websites and mobile apps. The assistants answer common and not too complicated customer questions. Customers can save time and are quickly responded to requests, since chatbot / virtual assistants always answer immediately without having to wait for their turn as when working with the customer service representatives. At the same time, customers will be served 24/7 at any time they need, information is more accurate and consistent because AI works regardless of the time and information searching speed is much faster than people.

artificial intelligence, chatbot
Illustration of AI chatbot

Some retailers also use AI to support providing information for customers at stores. LoweBot is an example of an automated robot used in improving customer service at stores, helping to answer customers’ questions or guide customers to the product counter that they are looking for quickly by giving verbal command or requesting information on sensor screen.

AI can also be used for apps that intelligently place orders and payments to optimize delivery times. Starbucks has launched the My Starbucks Barista mobile application that allows customers to order and pay by texting or chatting with a virtual barista and receiving products at the nearest store without queuing. AI technology is integrated in the application to help process orders quickly, while track the products that customers have purchased, thereby, suggesting customers about additional products, giving away Deals according to their preferences based on purchase history. As a result, the customer experience with Starbucks is enhanced, they are served faster, more conveniently with the most appropriate product suggestions.

Personalize customer experience

The feeling of buying is one of the most important factors that helps attract new customers and increase loyalty of old & current customers. Up to 70% of individual customers and 82%(2) of business customers agree that personalized experience affects their loyalty. This shows the important role of personalized customer experience. Recognizing this need, retail businesses have also been applying personalization in their businesses. Consumers now no longer need to search for suitable products anymore, but will be directly suggested by retailers through the results of buying habits and historical searches analysis. These results are gained as AI analyzes the entire history of interaction, customer transactions across all channels as well as actively asking questions, receiving feedback to predict habits, and preferences of customers and give them suggestions. It can be easily seen from surrounding examples such as favorite videos suggested on Youtube, favorite music suggested on Spotify, products that customers have just searched are immediately advertised on Facebook or websites that customers later on.

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Customers can also receive emails about the right products they need, based on the data they left during interaction process on social networks and searching sites. According to the research of Demand Metric(3), 80% of personalized marketing emails are more effective than the ones sent in bulk. Thus, personalizing email marketing with AI saves time and resources for businesses while brings more value to customers.

Retailers improve the experience of searching or selecting suitable products on AI-integrated customer applications. For example, Asos has launched the image search function on mobile applications, allowing users to upload pictures of people wearing costumes and search for similar products. Asos’ system will automatically analyze and search from the in-house clothing database to recommend related items to customers.

AI technology for the future of retail industry

The development of technology continues to change the face of the retail industry. Increasing customer demand along with constantly tastes changes and ever-increasing supplier options require retailers to constantly strive to bring new and differentiated experiences to customers. In order to meet these relentless changes, the application of artificial intelligence to continue exploiting and utilizing the data generated by customers will help businesses offer the best ways to serve customers.



Reference sources
(1) Walker. 2013. Customer 2020.
(2) Salesforce. 2017. Customers’ expectations in age of the customer.
(3) Demand Metric. 2016. Content Marketing Revolution: The age of hyper-personalization and Automation.

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