Artificial Intelligence tools are not new to the retail sector. While ChatGPT took the internet by storm in recent times, several retailers have been using AI to improve performance and experience. The global artificial intelligence in retail market size was valued at $5.5 billion in 2022 and is projected to grow to $55.53 billion by 2030.
AI does not just free up staff for higher-level tasks; it significantly improves the shopping experience and stays on top of demands 24*7. Retailers are starting to see the value of AI and implement appropriate solutions for more efficient business.
Here are a few ways AI can improve your business.
Customer Experience
Artificial intelligence significantly improves customer experience. First, AI enhances the shopping journey by offering accurate suggestions based on past preferences. Nowadays, virtual fitting rooms and chatbots for quick problem resolution are commonly utilized by big retailers. For the self-sufficient shopper, cashier-less self-checkout is excellent for saving time.
Additionally, AI allows retailers to run personalized promotions, which have a higher chance of converting into a sale than a generic promotion. Keeping track of individual customer behavior builds loyalty and makes shopping a more fun experience.
Cost-effectiveness
Using AI tools can be cost-effective on multiple fronts. According to a Gartner report, AI for price optimization can grow revenue from 1% to 5%.
Some mundane human tasks (like scheduling and tracking) can be automated using the right tools, freeing up time to improve customer experience. Artificial intelligence also allows retailers to intelligently allot resources towards marketing and advertising. Instead of spending more on mass marketing methods, retailers can deploy targeted campaigns with better returns.
AI also helps you order and maintain an inventory you can sell instead of being faced with over-ordering or critically low supply.
Price Regulation
The right AI tools also allow retailers to competitively price their products to support better sales. Imagine a system that combines demand, trends, market price, actual cost, purchase behavior, stock availability, and potential new model arrival to arrive at a price or promotion that will also ensure profit – this is what a good AI tool can do.
Optimized supply chain
At this point, AI is a must for categorization, inventory management, and supply chain efficiency. The right tools allow retailers to forecast inventory needs based on customer behavior and past data. These algorithms also identify purchase patterns to assist in running seasonal promotions.
Inventory management also helps keep track of product availability on the shelf to ensure quick replacement and guide customers toward required products.
