4 Ways Artificial Intelligence Will Penetrate in Retail


The use of AI technologies in the new generation enterprise and customer solutions seems inevitable. According to a research conducted by Gartner in 2016, AI was not among the top 100 technology areas to be invested. However, in 2017,  organizations and IT Managers made room on their agenda and AI ranked as the 7th technology investment priority. According to another recent Gartner study, AI will be built in most of the products that will be marketed by 2020. One of the top 5 areas where 30% of companies will invest will be AI-based solutions. Artificial Intelligence will also be a secret sauce, retailers will use as a game-changer, to support growth, to give customers a differentiated experience and to make a significant contribution to competitive advantage*.

AI will penetrate the processes with 4 main approaches;

  1. Minimize customer’s effort in shopping. From Augmented Reality to the rise of ChatBot, many of the emerging user experiences have a common point, accessibility and serviceability; anywhere, anytime. Today, we have come to the point where we can order coffee with a mobile assistant or ask a Facebook Messenger bot when we need an umbrella. The experimental store concept, which Amazon has just launched is a good example of effortless buying, empowered by AI.
  2. AI injected into the workforce. AI reaches every corner of the store’s back office processes and in-house operations, enhancing its effectiveness. Artificial Intelligence seems to help employees work faster, add value and be more accurate rather than stealing their jobs. The trainings will be delivered by AI, continuously and interactively. AR will help to service the customers with the products not present in the store or those not even produced yet. For example, Nike recently developed a store concept in NYC, called “Nike By You Studio” that allows the customers to design their shoes – with the help of a designer associate- and having them on their feet just after 90 minutes**. With this customer experience process characterized as “Nike Maker Experience”, the system uses AR,  object tracking and projection systems to show the selected design on the shoe.
  3. To take advantage of the opportunities provided by the platform economy. Business models like Ebay, have been working for decades on platform economy. Today’s platforms, integrated systems and IoT transmits the consumer’s requests directly to the manufacturer in real-time. Smart home “hubs” are offered over platforms like Samsung, Google, Apple and Amazon. For example, by pressing a button (Amazon), a user can place an order for a laundry detergent or diapers. If you like the song you listen to on your smart speaker, you can ask Microsoft Cortana to buy it for you.
  4. Focus on customer needs and redesign to facilitate the shopping process. Customer-related processes can be made more efficient and effective with modern engineering and design. Design-oriented engineering, also called “DesignOps”, works on processes that cause difficulties in customer interaction; such as problems getting product support or trying to find what they are looking for. Speech interfaces (chatbots), process automation, and AR can provide ways to deliver a better customer experience.

While we are already making room for AI in our lives, we have to be careful not to make the cure worse than the disease. Unexpected discomforts may come up by the use of AI or robots, in customer interaction or collection of personal data. It is critical to timely detect such inconveniences and to take quick actions, not to jeopardize the customer happiness.

Every new ‘digitalization’ and ‘intelligent automation evolution’ step will influence our lives significantly.  For this reason, businesses should be careful to act within the ethical framework while innovating and make sure they perform cross-tests to predict the effects of the new processes.

(*) Why retailers need to prepare for an AI- first world, today – and how they can. Avanade’s Tech Vision Report, 2017

(**) Nike’s new tech creates custom sneakers in under 2 hours, Stephanie Pandolph, Business Insider, September 2017.


Please follow and like us: