How AI Can Transform the Retail Customer Experience

In a recent market analysis from UBS, retail was ranked among the top industries predicted to be most impacted by artificial intelligence (AI) in the years to come. In fact, analysts have estimated that global retailer spending on AI will reach $7.3 billion per year by 2022, up from just $2 billion in 2019.

When it comes to where this money will be spent in the coming years, the majority of it is expected to be used to better the customer experience (CX), including everything from personalization to customer service. It’s an essential area to invest in given one in three (30 percent) consumers would post a negative review online or to social media if they received poor customer support, proving the need for enhanced CX to maintain customer loyalty, and even gain new shoppers. Brands are still just beginning to untangle the many advantages of using AI in retail, so let’s explore how AI can transform the customer experience.

Increase Personalization Through ‘Natural’ Data Use

As the retail sector has become increasingly digitized in the last decade, retailers have gained a mass of data about every shopper. This has created an opportunity to personalize the shopping experience in a new way. However, the type of data brands are focusing on can make or break the strides of their success. Small data, rather than the increasingly talked about big data, is where retailers should focus in today’s market. This data delves deeper into the goal of one’s purchase and provides a more personalized experience based on that reasoning. For example, sending someone a promotion for throw pillows after seeing they bought a new couch is a tactic to more naturally attract customers in a way that better meets their needs.

Create Efficiency in Customer Support

Omnichannel has become the norm for conducting business in the retail sector. With the many touchpoints that omnichannel presents, there's also a major increase in traffic flow. Implementing chatbots and automated messaging is an efficient way to streamline and manage that traffic through first-level interactions. A chatbot or automated message can cut out the unnecessary touchpoints often experienced when dealing with customer service, routing the shopper to the correct contact to solve their problem on the first try.

Strike a Balance Between Voice and Mobile

With the rise of voice assistants and in-home devices growing in popularity, it’s a good time for retailers to invest in voice technology. In fact, 29 percent of consumers who own a voice-controlled device have used the device for online shopping, and 41 percent plan to use it for shopping in the future. While this is becoming an essential strategy to stay on top in the ever-evolving retail space, brands must still continue investments in mobile. Consumers need multiple options to stay engaged when it comes to searching and shopping. If they hit a roadblock with voice, using type-based search will be their next step.

Merge Technology With the Human Touch

While AI-based technology is constantly providing new results and customer experiences, retailers must not forget about the human aspect of shopping. Relationships and emotional intelligence are key to providing a better customer experience, and those are skills only real life humans can provide to a shopper.

As AI continues to evolve, retail brands that leverage this technology will improve their customer experience. By merging AI-related technology such as voice assistants, chatbots and data analytics with the human emotional element, retailers will maintain customer loyalty and stay on top in the industry.

Isabella Mongalo is a senior digital strategist at TSC (Sitel Group), a customer experience management company.