If you’re an ecommerce manager, you don’t need to worry about artificial intelligence replacing you. However—and I mean, a BIG, however—someone savvy in AI will. If you’re not integrating it, you’re falling behind. That’s because AI in ecommerce has become a game-changer, one of the biggest ecommerce trends revolutionizing how online businesses operate and engage with their customers.
As a digital marketer, I’ve used AI to write sales copy, generate first drafts of articles (this one included), and successfully streamline my workflow.
I believe in AI-powered tools and workflows—so much so that I pitched an AI writing tool to my manager at work, and now, we’re about to kick off a project to implement it in our content marketing workflow. So, when I say it’s time to look into AI tools, I mean it.
Instead of being intimated by AI, I hope you can also see its potential so you too can bring these tools into your workflow, boosting your career and ecommerce business’ success.
In this article, I’ll cover why AI is taking ecommerce websites by storm, 13 ways to use AI in ecommerce, and tools and tips to implement it for the best outcomes.
The Rise of AI in Ecommerce
Thanks to the recent AI boom and the arrival of tools like ChatGPT and Google’s BARD, this ever-evolving tech is being democratized. Unlike before, you no longer need to be a Fortune 500 company or MIT researcher to harness it.
Because of this, forward-thinking ecommerce leaders are racing to enhance their operations with AI or build it into their website and product offerings to elevate the user experience—or both.
According to a 2022 IBM report:
- 44% of organizations are working to embed AI into current applications and processes.
- 1 in 4 companies is adopting AI because of labor or skills shortages.
- 1 in 5 companies is adopting AI because of environmental pressures.
- 35% of companies reported using AI in their business already, and an additional 42% reported they are exploring AI.
As we’ll cover in this article, AI is transforming ecommerce through personalization, automating repetitive tasks, enhancing customer service with chatbots, optimizing inventory management using predictive analytics, improving logistics operations via preventive maintenance checks, offering AI-powered visual search capabilities, and more.
These advancements lead to a more efficient and personalized shopping experience for customers. Without further ado, let’s take a look at use cases for AI in ecommerce.
13 Ways You Can Use AI in Ecommerce
1. Enable personalization for better shopping experiences
AI-driven insights enable ecommerce retailers to create unique customer experiences by collecting and examining data related to their behaviors and preferences.
This level of customization increases retention and boosts conversion rates for businesses that successfully personalize their customers' experiences.
2. Provide product recommendations using AI-driven visual search
AI-driven visual search technology enables online retailers to analyze customer preferences based on images they interact with or upload, helping them provide more accurate product recommendations tailored specifically for individual consumers.
Here are some examples of how to use AI-driven visual search:
- Fashion retailers can recommend clothing items that match or complement an uploaded image of an outfit.
- Furniture stores can suggest products that fit well within a specific room setting based on pictures shoppers provide.
- Beauty brands can offer personalized makeup suggestions according to skin tone and facial features captured in customers’ selfies.
By leveraging AI-powered visual search capabilities, you can create a more personalized shopping experience for your customers and, ultimately, drive higher sales.
3. Employ an AI-powered chatbot for improved customer service
Implementing AI-powered chatbots or virtual assistants in the ecommerce industry has vastly improved customer service quality by providing 24/7 support through natural language processing (NLP). These chatbots interpret voice-based interactions with your online customers and offer personalized offers based on individual needs or queries.
Here are three major reasons you should use AI-powered chatbots:
- Respond faster: Customers no longer have to wait for business hours or lengthy email responses; they can receive immediate customer support anytime.
- Deliver a better online shopping experience: By offering quick solutions tailored to each customer's needs, you create a positive impression that encourages repeat visits and loyalty towards your brand.
- Cut costs: With a bot, you don’t need to hire additional staff dedicated solely to answering inquiries from online shoppers—automation saves both time and money in the long run.
4. Optimize inventory management using predictive analytics
Predictive analytics, powered by AI algorithms and big data processing capabilities, allow ecommerce leaders to optimize inventory management by analyzing past sales performance, customer purchase history, and external factors such as seasonal trends or economic indicators.
By leveraging this wealth of information, AI-driven predictive analytics tools can accurately forecast future product demand patterns for specific items or entire categories within an ecommerce store.
Beyond providing valuable insights into potential customer behavior, AI-powered predictive analytics also help streamline the process of ordering new stock from suppliers.
With real-time updates on current inventory levels and projected demand forecasts, ecommerce platforms can automatically generate purchase orders based on predefined thresholds set by the business owner. This saves time and minimizes human error in manual calculations while reducing the risk associated with holding excess stock.
5. Increase the efficiency of your logistics operations
As you already know, a key factor for the success of your business has efficient logistics operations to ensure customer satisfaction and timely deliveries. Artificial intelligence can play a part here by conducting preventive maintenance checks on technology infrastructure used during packing procedures to reduce potential downtime.
Not only that, but AI-driven tools can utilize machine learning algorithms to identify potential bottlenecks or inefficiencies across the supply chain network, enabling ecommerce businesses to analyze data from multiple sources and optimize processes for improved decision-making.
By staying ahead of potential issues within your ecommerce supply chain network and ensuring that all equipment functions optimally with AI, you can maintain a competitive edge in today's fast-paced ecommerce market where customers expect speedy deliveries.
6. Generate sales copy quickly and efficiently
Got a case of writer’s block? It shouldn’t come as a surprise by now that advanced algorithms used in AI writing tools can generate sales copy within seconds, requiring minimal editing from human writers. Before ChatGPT even arrived, AI writing tools had been around for at least a few years.
And fortunately, since they’ve been out for a while, they’re starting to get better and better with each release, which is great news for your marketing campaigns. What’s so helpful about these tools is that you can give them a prompt, and then they will generate multiple versions of text for you to choose from.
For example, if you want to write Google Ad copy based on a keyword and some basic information about your brand, you can receive a dozen outputs, then use the ones you like or ask the tool to generate new ones.
7. Create and enhance images
As they say, a picture is worth a thousand words. While high-quality images could cost thousands of dollars, with AI image tools, you can make endless kinds of images for free.
And, if you want to make an ad or image that really grabs attention, consider looking into an AI tool to help. Take, for example, the AI-generated image where the Pope seemingly traded his traditional attire for a big, white puffy jacket. The image was a viral sensation because of how real it looked. (Not saying you should try to make an imposter brand influencer with AI!)
AI image tools enable you to:
- Turn your rough ideas into finished graphics.
- Generate multiple images in minutes, from mockups to the real deal.
- Remove the background from an image and replace it with something else.
- Create quality mages without models, green screens, or renting a studio.
- Make it easy to build a library of product imagery so you never run out of fresh images.
- And, ultimately, help you launch products faster.
8. Rapidly design your next logo
Maybe you’re about to start a new brand or website. If you have a logo idea living in your head, just say the word, and AI will whip up something for you.
And if nothing comes to mind at all, no sweat. AI tools could prototype endless ideas for you.
9. Prevent abandoned carts through targeted remarketing campaigns
The holy grail in ecommerce? A solution to reduce the number of abandoned shopping carts.
To combat this issue effectively, you can leverage AI-driven remarketing campaigns that target users who have abandoned their carts with personalized ads and incentives to encourage them to return and complete the transaction.
10. Tailor content and advertising messages using AI-driven insights
On that note, you can also apply artificial intelligence in ecommerce to tailor content and advertising messages based on user preferences, browsing history, and purchase patterns.
By leveraging machine learning technologies, ecommerce companies can analyze large datasets to identify trends, predict potential customer interests, and deliver more relevant marketing materials.
For example, an online store might use AI algorithms to recommend products similar to those previously purchased or viewed by a shopper.
Some key benefits of using AI solutions for tailored content:
- Increase engagement: Personalized content keeps users engaged longer as they find it more relevant to their needs.
- Boost conversions: Relevant and personalized product recommendations increase shoppers' likelihood of purchasing.
- Better ROI: Tailored advertising campaigns result in better customer interactions, higher click-through rates (CTR), and higher return on investment (ROI).
11. Automate cash reporting and forecasting
Okay, let’s say you’ve got AI making your sales, logistics, marketing, and customer experience better, and now you’re flush with cash.
Cash is the lifeblood of any ecommerce business, and properly managing ecommerce cash flow helps to ensure that its well circulated throughout your business. You always want to have enough liquidity on hand in every area of the business that needs it so you can pay your vendors on time.
These days, bank APIs can work in tandem with ML in an AI-powered cash management platform to aggregate and standardize bank data from multiple bank accounts, saving you from manually doing this task. This is especially helpful when you have several business units that have different bank accounts, banks, and currencies, and you want to know, in real time, how much cash you have.
ML can also help you to organize cash inflows and outflows into specific groups using tags, enabling your finance team to search and filter transactions across key vendors and accounts. This can be particularly helpful because you can generate cash forecasts based on these tags.
You can also use machine learning to establish a baseline forecast or run scenario planning and variance analysis. Scenario planning helps you prepare for different factors, like a sudden increase in the price of materials or a drop in demand.
With variance analysis, you can compare forecasted cash flow to actual cash flow to see what caused the numbers to differ and help improve forecast accuracy in the future.
Being able to quickly and more accurately forecast cash with ML/AI will help your ecommerce business better handle unexpected circumstances and confidently make the right snap decisions.
12. Automatically reconcile invoices
AI has much potential regarding invoice reconciliation or matching invoices from ERP systems to bank transactions. This is an important step to ensure you’re not paying for a service or product you did not receive.
AI, and more specifically, Natural Language Processing (NLP), can be used to streamline this process, saving your ecommerce accounting staff a few headaches.
Top AI Tools Every Ecommerce Team Should Consider
By now, you should have some concrete ideas for implementing AI in your ecommerce business. Did you think I’d leave you hanging without naming tools you can use to do all of the above?
Here are some AI tools you can try to boost productivity and increase efficiency across every area of your ecommerce business:
AI chatbots and recommendation tools
- Dialogflow: A conversational AI ecommerce chatbot by Google that picks up on patterns, navigating through complex conversations to improve conversion rates.
- Chooch: AI vision tool for retail that helps drive higher revenue while creating a more enjoyable shopping experience for customers.
- ViSENZE: A smart recommendation tool that uses machine learning to display products your customers will likely want to buy.
- Google Cloud: Provides personalized recommendations based on the customer’s previous shopping experience and history.
- Cleed.ai: An all-in-one tool for conversational commerce & personalization, plus visual search.
AI tools for improving ecommerce operations
- BigCommerce: Commerce-as-a-Service tool that (CaaS) enables you to create custom ecommerce solutions for your customers, powered by a modern platform with AI.
- Acumatica: A modern cloud ERP solution for ecommerce that incorporates AI and ML
- Salesforce eCommerce Experience: AI-powered checkout flows, payment accelerators, real-time inventory visibility, advanced allocation logic, and order lifecycle management
AI tools for writing ecommerce copy
- Content at Scale: Enables you to write long-form, SEO blog posts based on a keyword, video, or podcast episode.
- Jasper & Copy.ai: Help you write short-form copy for product descriptions, ads, social media posts, emails, etc.
- Grammarly: AI-driven editor that instantly catches grammatical errors in your text and helps you match a tone of voice, available as a Chrome extension, desktop app, and SaaS app.
- Wordtune: Use this tool to spice up any sentence and clarify your message.
AI graphic design tools
- Canva AI Image Generator: a DIY graphic design tool that allows you to generate images from words.
- Ocus: Easily improve and edit user-generated content.
- Neural Love: A free AI image generator that resizes and remodels images to fit your needs.
- Scribble Diffusion: Turn your doodles into pictures.
- Midjourney: Generate images from natural language descriptions (via a Discord server).
- Descript: Create captivating video content for your store.
AI tools for ecommerce pricing & financial management
- Prisync: A Shopify dynamic pricing app that helps you monitor your competitors’ price moves from a single dashboard and import all your products with a single click.
- Trovata: An automated cash management platform that enables you to use AI and ML to manage cash and all of its complexities with ease
AI productivity tools
- ChatGPT: The ultimate AI assistant and generative AI tool.
- Merlin: An extension of Chat GPT that allows you to use it anywhere on the web.
- Notion: An AI to-do list where you can also manage content and collaborate.
- Typly: Think T9 on steroids, an AI keyboard that helps you to answer all your messages with a single click.
How to Implement AI in Ecommerce
Finally, when it comes to AI in ecommerce, there are infinite ways you can get started. But please, don’t bite off more than you can chew! Change takes time, and you’ll need to iron out the kinks, so start small and work your way up.
I suggest identifying your biggest pain point and working from there. What processes can AI help you to automate that take up most of your time?
Is there something you don’t have time to get to? For example, if social media marketing is an afterthought for you, you might want to try using an AI tool to help you generate posts.
Here are some steps you can follow to implement your first AI process:
- Do a SWOT analysis for AI in your organization.
- Pick a process to enable AI first.
- Trial one tool at a time and see which one you like best for that use case.
- Once you’ve determined which tool to use, if you need permission to purchase, make a case based on time savings and the potential ROI to your manager.
- Roll out incrementally.
- Take note of how the implementation process is going to improve over time.
- Identify new ways to expand your use of AI.
Making A Case for AI In Ecommerce
By leveraging AI technology for ecommerce, businesses can optimize their operations and maximize returns while simultaneously providing superior customer experiences, driving higher rates of customer loyalty.
AI can unlock fresh chances for your business to capture more demand and generate more revenue while giving customers a superior experience.
The possibilities are endless when it comes to using AI for ecommerce, so start exploring today.
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