Is AI Shopping the Future of eCommerce?

AI has the potential to disrupt every aspect of our lives, and it’s already changing how we shop online. The rise of artificial intelligence — especially generative AI — is often framed as humans versus machines. As technology gets smarter, these critics ask, will eCommerce even need customer support, marketing, or product development teams?

The short answer: yes. (Phew.) AI is only as smart as the humans deploying it. And if brands want to streamline operations and create better customer experiences, they need to foster collaboration between people and technology. 

Read on to learn more about the current state of AI shopping, where it’s going, and how brands can harness the power of this rapidly evolving technology to transform their businesses.

The current state of AI in eCommerce

It’s not easy navigating the current crop of AI solutions. For one thing, there are just so many of them — how do you even cut through the noise? Plus, many of the tools that claim to be powered by artificial intelligence have a loose connection to the technology at best. And finally, simply implementing AI features doesn’t mean that you’re using them to their full capabilities. 

There are also internal barriers to AI adoption. In fact, research from Gartner shows the primary obstacle to AI implementation, as reported by 49% of survey participants, is the difficulty in estimating and demonstrating the value of AI projects — surpassing other challenges like talent shortages, technical difficulties, data-related problems, lack of business alignment, and trust in AI. 

If you take a hard look at your tech stack, you’ll likely find that you’re already using solutions powered by AI — whether you’re getting the full value from those tools, however, is another story.

How AI is transforming online shopping

With so many options available for AI solutions, it can be tempting to employ it for everything. It’s important to focus on where it will make the most impact for your business. Here are some of the most effective AI use cases for eCommerce where artificial intelligence can provide real value.

Personalization

Personalization drives both sales and retention for eCommerce merchants. According to research by McKinsey, 76% of consumers are more likely to consider purchasing from brands that offer personalization, and 78% are likely to make repeat purchases. 

Retailers have long understood the importance of offering personalized online shopping experiences, but creating tailored journeys at scale was, for a long time, only available to industry giants capable of developing proprietary recommendation algorithms, like Amazon. Today, though, the availability of out-of-the-box solutions like AfterShip Personalization can help merchants deliver personalized shopping recommendations and smarter site search at scale. In fact, brands using this technology see up to a 70% lift in AOV. 

Logistics

Once a customer places an order, all they want to know is when it will arrive. If you frequently shop online, you know how often brands fall short when meeting their shipping and delivery promises. This isn’t always a merchant issue, though — transportation, weather, and carrier problems can always arise. Without the right tracking technology, customers are left in the dark, which can erode brand trust and lead to less-than-stellar reviews. 

AI solutions can help brands get a real-time view of what’s happening across their entire logistics operation, so teams can easily see when issues arise and enhance processes over time. And AI-powered estimates like AfterShip EDD can help brands deliver accurate information to customers even in changing conditions. 

Customer support

CS teams have a huge responsibility when it comes to improving and maintaining customer satisfaction, but too often, they get bogged down in rote tasks like WISMO tickets and answering simple questions, which means that customers with more complex issues have to wait longer or get short-changed on solutions to their issues. 

Implementing AI technology in key customer service areas can help reduce the burden on agents and give them the breathing room to offer more 1:1 assistance when needed. Chatbot technology, virtual assistants, and artificial intelligence-powered workflows and analytics can help streamline and improve the support experience so every customer can quickly get the help they need.

Catalog and inventory management

In omnichannel retail, catalog and inventory management can be a challenge. When you’re selling through an eCommerce platform, on social channels, through online marketplaces, and in brick-and-mortar stores at once, aligning product listings and keeping track of inventory levels is vital for ensuring a consistent customer experience. 

What was once a manual process can now be achieved with smarter technology. AI tools can help you with tasks like product tagging, price optimization, and predictive inventory management so you can deliver a seamless customer journey no matter where your customers shop — and your teams can focus on strategy, not databases. 

Analytics

Every eCommerce merchant knows that customer data is important, but extracting useful insights from it can be a challenge. Why? Because your data doesn’t all live in one place — it’s siloed across tools and channels. Plus, as a business scales, so does the volume of data. And navigating ever-changing privacy regulations is making traditional attribution models less effective. 

AI-powered analytics can help you parse your data for the metrics that will help you better understand your customers and their journeys in real time — and predictive analytics can help you uncover what your customers are likely to do next. You’ll be able to uncover the actionable insights that will push your business forward.

These are just a few of the high-level use cases for AI. On a micro level, artificial intelligence can power virtual experiences, summarize product reviews for customers, write product descriptions, and help you develop campaigns, just to name a few applications. It can literally transform your business — with the right processes and guardrails in place. 

The risks of AI in business

While sci-fi writers and conspiracy theorists envision a future where machines gain sentience and take over the world, the actual risks of AI carry lower stakes — but they still matter. 

Generative AI holds much promise, but it’s still in its early stages and should be treated as such. 44 percent of respondents to a recent McKinsey survey said their organizations have experienced at least one negative consequence from using generative AI — with inaccuracy cited as the top risk, followed by cybersecurity. 

Overreliance on AI tools and solutions without controls in place can lead to eroding consumer trust. That’s why AI won’t (or shouldn’t) replace the human touch. People are needed to fact-check AI outputs and to ensure that the right guardrails are in place to maintain privacy and security. 

Research shows that shoppers value authenticity when evaluating a brand, and that’s the one thing that machines can’t deliver. That’s why the best use of AI is in collaboration with skilled people across your organization. That’s where you can extract the most value. Invest in technology, but also in ensuring that your teams (or partners) know how to use it, and how not to use it. 

Merchants at the forefront of AI Shopping

We’re in the midst of an AI shopping revolution, and there are some merchants who are leveraging this technology in innovative ways. Here are a few to get inspired by:

e.l.f. Cosmetics

E.l.f offers an AI-powered virtual try-on feature, so shoppers can see how a product will look on them before they purchase. Consumers can either upload a photo of themselves, participate in a live make-up session, or choose from models with various skin tones and features.    

Stitch Fix

Stitch Fix’s approach to AI represents the power of human and AI collaboration. The brand collects zero- and first-party data on customer preferences and then an AI-powered algorithm chooses the styles they’re most likely to love. Then, a live stylist takes those recommendations and curates them into a bundle for the customer. 

Amazon

Amazon’s new AI-powered virtual shopping assistant Rufus is trained on the retailer’s product catalog and information from across the web to answer customer questions, make suggestions, and facilitate product discovery in the Amazon app.

What’s next for AI shopping

AI Shopping is the future of eCommerce, and it’s already here.

Artificial intelligence is rapidly transforming the retail landscape, and brands have a seemingly endless supply of innovative tools and features to power their strategies, with more launching every day. As more brands learn how to maximize this technology, they can deliver hyper-personalization at scale, better customer support, and an end-to-end seamless experience — all powered by human and machine collaboration.

AfterShip Intelligence brings the power of eCommerce AI to AfterShip’s suite of solutions, empowering merchants to supercharge customer experience, connectivity, and personalization. With these advanced algorithms, you can:

• Optimize your product catalog to accelerate time to market and enhance product intelligence.
• Deliver personalized AI shopping that leverages data to inspire shoppers to find relevant products.
• Standardize logistics data to provide comprehensive, accurate, and predictive tracking updates.

Want to learn more? Book a demo now.