How AI can Increase Conversions of e-commerce website
The concept of artificial intelligence was given by British mathematician AlanTuring. According to him computers are the only machines capable of demonstrating human behavior. Human behavior is complicated and involves information processing, recalling, speech recognition, voice recognition etc.Artificial intelligence (AI) can be defined as the potential of a digital computer or computer-controlled robot/ machine to carry out works that are commonly connected with human beings. This term is often used for the project of developing systems that are invested with the intellectual abilities like those of humans, such as the capacity of rational thinking, seek meanings, and learn from the experiences faced.
Artificial intelligence has two broad streams i. Narrow AI ii. Generalized AI
In narrow Artificial intelligence mostly the systems are able to perform better than human beings in one or two domains. For example Watson developed by IBM can scan around 2 million moves from the game of chess. Deepmind which is a subsidiary of google has developed an Artificial intelligence system with the name of AlphaGO which defeated LeeSedol, 18times chess champion.
Generalized Artificial intelligence is also known as singularity. The objective of the Generalized Artificial intelligence is to develop systems which can perform better than human beings in almost every domain.
The goals of Artificial intelligence can be summarized as :
- To create Expert Systems i.e the systems which exhibit intelligent behavior for example Mycin, it is an expert system which is capable of not only diagnosing the infection but also prescribing the treatment.
- To implement human intelligence in machines ie to realize the ultimate objective of robotics. For example Mitra, Sophia, Robonaut, Erica etc.
With the two streams of Artificial intelligence and the goals of Artificial intelligence, Artificial intelligence finds its application in many fields such as Manufacturing, Healthcare, Fintech, e-Commerce etc.
e-Commerce and Artificial Intelligence and Conversion Rates
Artificial Intelligence can be applied in eCommerce right from placing orders to delivery and many ecommerce giants have begun implementing it, such as amazon and reaping the benefits of Artificial Intelligence. Some of the remarkably successful firms like Facebook, Google, Yahoo etc. that are specifically tech firms have already voiced out their concentration on the development of Artificial Intelligence as the major source of raising their business.
In the recent years there are numerous scholarly articles written about Artificial Intelligence taking over in the market place. It is said that more than 80% of the interaction with the consumers will be done through AI only, without the involvement of humans. Narrow Artificial Intelligence is the most important form of Artificial Intelligence finding its application in the e-Commerce industry.
Artificial Intelligence is widely employed to learn about the preferences of the users amongst all the platforms, understand their patterns and specifically for the Indian markets understand the price sensitivity of the products. Artificial Intelligence is again employed in the supply chain and logistics to understand the seasonal or temporal demands and volume of goods and arrange the deliveries accordingly eg. Using GIS and Drones delivery systems. In warehousing Artificial Intelligence is employed to efficiently place the goods to reduce the packaging, sorting and dispatch time. All of these things lead to improved targeting, service delivery to the customer and in turn greatly improve the conversion chances in e-Commerce. It also reduces the human interaction to the minimum and eliminates greatly the chances of errors.
One of the most common problems in e-commerce, which is the consumers leaving their experience with e-commerce midway because of the product results not matching their choices often. This problem is taken care of with the help of AI to show results that match the preferences of the online shoppers or consumers. Another approach to utilize AI in to increase conversion rate of e-commerce is through “artificial intelligence with a vision”. This development in the area of software allows the business to get an upper hand in producing a customer centric approach by their business. This software has video as well as advanced image recognition potential.
Artificial Intelligence can be used by any business runners (small, medium, big ones) with the help of efficient software developers that can be outsourced. It empowers a business to compete in a market place and grow their profits by retaining their consumers. More and more people are switching to e-commerce platforms that are run by AI software because of the personalized and interesting search results they provide, varying from customer to customer. The Artificial Intelligence software performs the role of an online assistant to help the customer in finding the product of their requirement.
AI targets and retargets the customers (existing and potential) without bombarding them unwanted information. Most of the times the customers are not targeted adequately because of the massive amounts of the customer related data that is almost impossible to be managed humanly.
For more of such readings on Artificial Intelligence and e-Commerce go for Technology Review MIT Magazine subscription, Technology Review MIT.