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How Artificial Intelligence can help store owners?

In the past few years, Artificial Intelligence (AI) has made some interesting advancements in many industries. Although the average customer may not be aware of this, artificial intelligence has been applied in the retail sector as well.

Although not every retailer can afford to use these solutions due to high costs, inaccessibility and proprietary systems, the largest players in the retail market have been pretty active about AI solutions. They can bring many benefits and help improve the efficiency of our store. According to the Deloitte Digital report, 74 percent stores using AI-based solutions, noted an increase in sales.

How does Artificial Intelligence work?

AI technology is based on downloading a large data set, processing it using Artificial Intelligence algorithms, such as neural networks, and then creating a model that provides the response that the real person would create.

Artificial Intelligence in retail

Artificial Intelligence in retail can process and link sales data with customer data. After processing this information, you can create a model that discovers useful information about customers, products and inventories which are not normally obvious to the store owner.

AI can acquire a lot of information about our clients, their preferences and behavior. Importantly, AI can process this information on an ongoing basis and in an almost immediate manner. In this way, we can influence the customer’s decisions, for example by making him buy more products than he originally planned. If AI knows what customers need before the transaction and issues them a coupon for a given product, this can trigger them to buy an additional item which they did not come for.

Another benefit may be the improvement of the quality of customer service. If the seller offers the client exactly what he needs, it will improve the quality of the client’s relationship with the store and the customer’s perception of it. According to the Deloitte Digital report, 83 percent sellers who use intelligent sales, said that it allowed them to “retain customers”. On the other hand, 80 percent admitted that AI enabled them to nurture customer relations.

Another area in which AI can help is the way products are physically laid out in the store. After the delivery of sales data, Artificial Intelligence can discover patterns in your customer’s buying preferences and learn what they buy together. Based on this, AI can provide you with suggestions on what items to put next to each other in your store to encourage customers to buy more.

Another application of AI is the optimization of stocks and the functioning of the supply chain: artificial intelligence tools provide greater completeness and promptness of delivery than traditional systems and besides, they are able to predict the development of supply and demand.

Artificial Intelligence is not for everyone

The examples given do not cover all potential uses of Artificial Intelligence in the retail industry. At present, only large commercial networks with appropriate technology budgets can afford to use Artificial Intelligence systems. A breakthrough moment will occur when smaller retailers will also have access to these tools. The human factor, i.e. low awareness about the benefits of AI, also needs to be refined. The popularization of AI will therefore proceed as the awareness of the management staff increases. Intelligent sales increase productivity and reduce the time of work for sales and customer service teams. It also benefits the client.

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