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3 Ways AI and Machine Learning is Changing Retail Software
July 19, 2024 / 9 minute read / By Zoya Naeem
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Want to provide more personalized customer journeys and more profitable pricing? Consider Artificial Intelligence (AI).
Did you know that 80% of shoppers prefer a personalized shopping experience? In today’s competitive retail landscape, keeping customers engaged and happy is more important than ever. However, managing large stores and multiple locations can make personalization a BIG challenge for retailers.
AI and machine learning can offer a solution to retailers.
This powerful technology analyzes vast amounts of customer data and provides a better understanding of their buying habits and preferences. This translates to a more personalized shopping experience for your customers while streamlining operations behind the scenes.
In this article, we’ll explore the potential of AI in retail and how it can be used to improve your business.
We’ll dive specifically into:
How to Use AI to Offer Personalized Shopping Experiences?
Just imagine, what if you knew exactly what your customers want before they even walk into your stores?
That’s the power of AI in retail, and it’s changing the way you do business.
Artificial Intelligence (AI) is a powerful technology that allows computers to learn and improve without explicit programming. In the retail world, this translates to software that analyzes large amounts of customer data, including past purchases, browsing behavior on your website or mobile app (if you have one), and even loyalty program information (if applicable). By analyzing this data, AI can identify trends and patterns in customer behavior.
For instance, let’s say a customer frequently buys athletic wear from your store, specifically running shoes. Now, using an AI-powered retail POS system will help you pick up on this and analyze their past purchases to understand their shopping preferences. For example, did they buy a specific brand or type of running shoes? Did they also purchase other athletic apparel, like socks or workout clothes?
Based on all this data, your retail system can predict what this customer might be interested in seeing next. And this is where personalization comes in.
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AI-powered retail systems enable you to send targeted product recommendations to your customers via in-store displays, personalized emails, or even AI predictive site searches and product recommendations on your website. These AI-driven product recommendations save time browsing and showcase the most relevant items your customers are likely to be interested in.
This translates to several benefits for your business:
Pro Tip:
Choosing an eCommerce provider with AI capabilities can transform your online retail business. From displaying best-matched products based on only a couple of letters entered into the search box, to instantly showing product information faster to encourage faster clicks into your product pages, to suggesting additional products based on machine learning and search history by implementing AI applications to your eCommerce site, you can significantly reduce the friction on your site.
How to Generate Search-Friendly Content for Your Retail Business Using AI
Let’s say you have customers searching for that perfect pair of jeans online. You would want your store to be the first stop they see. That’s where Search Engine Optimization (SEO) comes in.
SEO basically helps your site rank higher in search results, making it easier for customers to find your products and services.
Watch This Short Video: to Learn The 4 key areas of SEO that you, as a Retailer, Can Focus On.
Creating high-quality content that search engines (e.g., Google, Bing, Yahoo, etc.) love is crucial for good SEO. This content should include relevant keywords that people are searching for, along with clear and engaging descriptions of your products and services. This will make your products and services easily discoverable and increase the chances of converting your website visitors into customers.
This is where AI for SEO content steps in as a helpful assistant. It can significantly improve the efficiency and speed of generating high-quality product descriptions, category pages, and other forms of content. By analyzing keywords, search trends, and customer preferences, AI can help you produce relevant and engaging content that both search engines and your customers like.
But remember, AI is not intended to replace humans.
It’s there to assist you in completing tasks more efficiently. While it can draft content in a fraction of the time it would take a human, this content still needs to be reviewed, modified and prompted accurately to ensure relevancy and quality.
The human touch is important for maintaining the authenticity and personal connection that makes your brand resonate with your customers.
How to Deploy Smarter Pricing Strategies Using the Power of AI
Dynamic product pricing is a modern approach that leverages advanced technology to recommend prices based on real-time data and various market conditions.
Unlike traditional pricing strategies, which often remain static for longer periods of time, smarter pricing allows retailers to adjust prices dynamically but with a crucial distinction (these price adjustments are retailer-approved, meaning prices do not change automatically without your review and approval.) This ensures you have full control over your pricing decisions while leveraging AI.
AI-powered pricing strategies allow real-time price adjustments based on factors such as supply and demand, competition, location, geography, and inventory levels.
For instance, if a specific product is in high demand but low in stock, AI can suggest a price increase to optimize profits and vice versa. AI can analyze your competitors’ pricing and help you adjust your product prices accordingly to stay competitive in the market.
Moreover, AI helps retailers like you find optimal product price points. By analyzing historical sales data, customer buying habits, and market trends, AI can identify the price at which a product will most likely sell while maximizing its profit. This helps ensure that your pricing strategies are both profitable and competitive.
Pro Tip:
Selecting an eCommerce software provider that offers AI-optimized pricing can transform your online retail strategy. AI-driven dynamic pricing adjusts in real time based on various factors like demand and competition, ensuring you stay competitive while maximizing profits. As AI continuously learns and collects data to suggest optimal prices, taking into account historical pricing, demand forecasting, and purchases, all of this simplifies the pricing process and enhances profitability and competitiveness in the market.
How to Pick the Right Retail System for Your Business?
As AI continues transforming the industry, retailers embracing these advancements will stay competitive and improve their business operations. Those who don’t take the leap and fail to learn how to use AI effectively, prompt it, and integrate it to assist their staff will inevitably fall behind.
It is crucial to understand that AI is not designed to replace humans. Your staff (your people) are the heart and soul of your business and will always be.
The sole goal of AI is to empower your team to do their jobs better and faster.
By leveraging AI, your team can spend more of their time on critical tasks such as serving customers and increasing sales, rather than getting bogged down by time-consuming, monotonous processes.
From creating personalized shopping experiences to generating search-optimized content and deploying dynamic pricing strategies, AI is a real game-changer for retailers.
By choosing a forward-thinking retail POS software provider, you are not just adopting new technology but also investing in the future of your business, making sure you stay ahead in the competitive retail market.
Interested in learning how we can help elevate your retail business to new heights?
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