Artificial intelligence (AI) has had a significant impact on various industries, including finance and healthcare, and is now starting to transform the e-commerce sector. Companies that do not adopt AI may struggle to keep up with the competition and risk suffering damage.
The COVID-19 pandemic has led to an increase in the adoption of AI in different businesses. In 2019, it was predicted that spending on AI technologies would reach $97.9 billion by 2023. Today, AI has become an essential part of how we shop and conduct business online, helping brands and retailers engage with customers, track trends, make better business decisions, and provide personalized experiences.
Here are the top seven e-commerce AI trends to expect in 2022 and 2023.
1.Increase in voice search and voice-controlled shopping
In recent years, there has been a significant increase in the use of voice search and voice-enabled shopping, thanks to the widespread adoption of AI voice assistants such as Alexa, Siri, and Google Assistant. In 2020, around 27% of shoppers utilized voice assistants to make online purchases, generating approximately $40 billion in revenue in the United States and United Kingdom alone.
As consumers become more accustomed to using AI voice assistants, the technology behind voice-enabled shopping is expected to continue improving, particularly through the use of natural language processing (NLP) technology, which allows for more precise responses to complex voice queries, ultimately resulting in a more seamless and efficient shopping experience.
2.A more intuitive and engaging visual shopping experience
Artificial intelligence (AI) has made it easier for consumers to make large online purchases with greater confidence by providing more intuitive and engaging visual shopping experiences. Through the use of visual AI and augmented reality (AR), brands and retailers can offer virtual try-ons for clothing and beauty products or 3D renderings of furniture to show how it would look in a space.
In the coming years, we can expect to see more eCommerce companies incorporating visual search options, advanced AR/VR tools, and sophisticated product recommendations that use visual AI to make recommendations based on individual preferences.
These AI-assisted visual shopping experiences will also play a major role in social commerce, with platforms such as Facebook and TikTok investing in improved product recognition and recommendation capabilities to make product discovery quicker and more accurate.
3.Smarter upsell and cross-sell opportunities
AI offers brands and retailers the opportunity to stay competitive through the use of accurate predictions and smarter methods for upselling and cross-selling. For example, an advanced AI-based recommendation engine can provide highly relevant suggestions for similar or complementary products based on the user’s current session activity, rather than just relying on browsing history and past purchases.
Research has shown that this type of technology can be effective, with 63% of smartphone users being more likely to make a purchase from companies whose mobile sites or apps offer them relevant product recommendations, and 49% of consumers making a purchase they did not originally plan to make after receiving a personalized product recommendation. In addition to recommendations, AI tools can help brands and retailers optimize their eCommerce merchandising by tailoring the order of search results and the placement of promotions to each individual visitor.
4.Greater use of real-time data analytics for operational optimization
Brands and retailers that are forward-thinking can improve their supply chain management and inventory assortment by analyzing which products are in demand and which items are not selling well. This data can be collected in real time as customers browse through brand websites and other channels, and AI-based machine learning can provide actionable insights on areas to focus on for sales, discounts, and other promotions.
In addition, brands and retailers can use visual AI to predict more specific trends based on detailed product tagging. For example, if round collars or balloon sleeves are becoming popular, this data can be used to anticipate upcoming customer demand and inform purchasing and inventory decisions in real time. This benefits both customers, by optimizing their shopping experience and reducing the number of “out of stock” notices, and brands, by reducing spend on irrelevant items and the amount of warehouse space dedicated to slow-moving products.
5.Growth of Direct-to-Consumer Sales
AI’s mainstream adoption has given brands and smaller retailers an opportunity to excel at creating the best customer experience possible, even in the face of competition from large retailers like Amazon and Walmart.
By using AI, it is easier and faster to personalize every aspect of the customer journey, particularly for companies with specialized products and a loyal customer base. This results in a deeper understanding of customers for brands and tailored experiences that align with individual preferences for shoppers.
This is why direct-to-consumer brands and approaches are expected to continue growing in popularity in 2022 and beyond.
6.More Effective eCommerce Fraud Prevention
As online shopping becomes more popular, eCommerce fraud has increased, leading to the development of AI-based fraud prevention and chargeback correction platforms. These technologies can automatically detect fraudulent orders, fake addresses, and other suspicious information that may be used to complete a transaction, and evaluate the risk level.
AI is able to identify patterns that can distinguish legitimate purchases from fraudulent ones, including patterns that may be overlooked by humans. With benefits such as real-time data processing, consistent results, and behavior analytics, it is likely that AI-enabled eCommerce fraud protection will become more widespread in the future.
7.Solutions to Support Mobile Commerce
Mobile commerce sales are expected to continue growing, with it being anticipated that by 2024, there will be over 187 million mobile shoppers in the US, representing over half the population. As such, it is likely that mobile commerce will become a major channel for online shopping, particularly for customers who want to conduct research, compare prices, and make payments on the go.
Brands and retailers in 2022 can benefit from optimizing their AI-powered mobile shopping tools, with a focus on visual search being particularly important. By allowing customers to upload images and search for visually similar items, brands and retailers can direct them to the most relevant products in their inventory, which can be especially useful when customers are inspired by items they see on social media or other online platforms.
AI is playing a significant role in shaping the future of eCommerce. It is becoming an essential part of eCommerce businesses and is helping to meet both consumer demands and business goals. By automating and optimizing the online shopping experience and focusing on key areas like omnichannel product discovery, fraud prevention, mobile shopping tools, and sustainability, brands can better connect with customers and provide them with the right products and experiences.