Can AI have a big impact on commerce?
ARTIFICIAL intelligence or AI is widely expected to transform the consumer journey, and conversation regarding that notion has been going on for years.
At the very core, AI will empower businesses to process all the data they have been gathering and gain valuable insights towards improving customer experience.
In practice, there are multiple ways of achieving this end. For instance, store associates with more information on the customer will be able to serve their needs in a prompt, yet personalized manner.
While AI as a theory goes back centuries and development of the technology can be traced back to the 1930s, the emergence of three key drivers in recent times have boosted AI technology and its impending consumer applications.
The three significant contributors to the proliferation of AI include;
- Exponential growth of data
- Sophisticated distributed network
- Advanced algorithm
According to one survey by Euromonitor International, 60 percent of the industry leaders surveyed ranked AI above internet of things (IoT) and automation as the technology that will bring significant impact to commerce in the next five years.
This survey had shifted the prevailing notion of which technology will bring about the most impact in the industry, as when Euromonitor did the same study in February 2018, IoT was a clear front runner.
The respondents in the survey expect AI to significantly enhance customer engagement by enabling custom marketing approach and more targeted, personalized recommendations.
Beyond that, industry professionals are also foreseeing AI handling the customer service request in the next five years. AI is already being deployed for this function in many industries in the form of chatbots, and the applications of the solution are expected to be more widespread soon.
Voice-activated applications is another function that is expected to be impacted by the development of AI as 57 percent of the respondents agreed to that notion, an increase of 8 percentage point from the February survey.
At any rate, while the emergence of chatbots and smart speakers have increased, the actual return on investments remains elusive at the moment, as can be seen with the explosion of voice-powered home assistants.
Alexa and Google home are increasingly adopted at homes, but that growth is yet to translate into increased sales. Nevertheless, the technology is still considered a gamechanger regarding the future.
Patrick Gauthier, VP of Amazon Pay, late last year said that the industry is at a big point of transformation.
“With voice, we are going to see different complementary experiences emerge,” he was quoted as saying.
Even though AI technology promises limitless possibility, there are still companies that are unwilling to invest in the development or implementation of the tech in their organization.
The lack of clear use case is the most cited reason for their hesitancy in adopting AI according to the survey, similar to the 40 percent of respondents who gave the same explanation for not investing in virtual reality and IoT for thier enterprise.