Think Tank: Retailers, It’s Time to Try On AI for Size

Shoppers may not know it, but they use artificial intelligence (AI) in their everyday lives. From turning to apps like Waze for optimal driving routes to using suggested tags on Facebook photos, consumers are immersed in AI as part of their daily routines. Despite this, many retailers continue to question AI and wonder whether it’s time to start investing in these emerging technologies. But if getting closer to their customers is the ultimate goal, retailers need to embrace AI today as a powerful tool to engage shoppers and supercharge employees.

Here are a few examples of AI in action, and how it is already transforming retail for the better:

Digitizing the Little Black Book of Retail: Smart Clienteling

Armed with the ability to research products on brands’ websites, social media channels and more, today’s consumers are more knowledgeable than ever. In fact, 80 percent of shoppers say that they research products online before going into a store. However, store associates aren’t often aware of shoppers’ levels of product knowledge when they enter a store, and unfortunately customers remain anonymous until they hand over their credit cards or provide e-mail addresses at the point of purchase. As a result, brand loyalists are often treated like first-time customers each time they walk through the door.

Thankfully, AI technology can empower store associates to offer shoppers personalized product recommendations and promotions based on their browsing and purchase histories. This is enabled through opt-in iBeacons or near-field communications technologies that identify when a shopper is near the store. From there, the associate can access the customer’s profile and see that she had added three dresses to her shopping cart earlier in the week. With the help of AI technology, the store associate could then pull the dress in the customer’s size and even recommend a complementary necklace or pair of heels based on what other shoppers who bought the same dress purchased to go with the outfit. This is the “little black book of retail,” fully digitized and made smart by AI. Now, every store associate has the power to deliver VIP treatment to shoppers rather than using a one-size-fits-all approach.

Anticipating Shoppers’ Needs: Personalized One-to-One Journeys

Simply responding to customers’ queries via phone calls, e-mails or tweets has become status quo. It’s a reactive posture, and it puts retailers on their heels instead of their front feet. The most successful retailers are reimagining customer service by anticipating what customers need, before they even know they need it.

With AI, retailers can predict and proactively address any issues before customers even reach out. For example, a store manager can get an alert about an increase in returns of a specific handbag. Diving into the cases, he might learn that all handbags returned were defective and made during a three-month period at the same manufacturing location. The associate could then proactively alert other shoppers who had made the same purchases and offer to send replacement items, along with private sale offers for their next purchases – turning a potential service crisis into an opportunity to transform shoppers into loyalists.

Supercharging Social with AI: Smart Commerce

Social media has created countless platforms for consumers to post pictures of their favorite products, review their best (and worst) shopping experiences and praise their style icons. And with social media driving 5 percent of mobile shopping traffic – up 61 percent over last year – there is no denying the power and reach of social channels. However, many retailers have yet to crack the code on how to use this information to their advantage.

With machine learning, a component of AI, retailers can automatically analyze images shoppers have posted on communities and social media to better understand their preferences and tailor marketing campaigns based on this data. For example, a retailer could use AI to recognize the shape of skirts a shopper pins on her Pinterest board and establish that she prefers skirts. By having this information, retail marketers can know to reach out to the customer with deals and offers on skirts, as opposed to shorts or pants.

Getting Employees Up to Speed: Empowering Store Associates

Retail is a high-turnover industry, and onboarding new associates is both timely and costly. In fact, without even factoring in lost productivity and the potential sales impact, the cost of replacing a single $10-an-hour associate is estimated at $3,000. Retailers need new ways to get new employees up to speed, so they can quickly deliver the level of service expected by customers in-store.

Many retailers have started to turn to internal social platforms for their associates to collaborate across stores to share knowledge, discover expertise and service their customers better. AI has the ability to make these platforms smarter and faster, making the onboarding process even more efficient. For example, an associate struggling to conduct a store operation, such as performing an end-of-day operation or installing a new product, could input a question into the retailer’s internal help desk and automatically receive the most helpful resources on this topic. This associate can even be directed to other articles that might be relevant and helpful.

Retailers should not fear AI, but rather embrace it to make their associates, marketing operations and overall shopping experiences smarter and better. It’s time for all retailers to try on AI for size.

Shelley Bransten is senior vice president of tech firm Salesforce.

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