The ABC of retail’s future – AI, bots and conversational e-commerce
Tracy Hubert, client services director at VERSA explores a new retail landscape driven by conversational AI and immersive technologies, where two-way interactions lead to transactions and brand experience trumps all else.
Oh, what a difference two years makes. Whether they wanted to or not, most retail brands made the leap of faith online when the pandemic hit and e-commerce became the ‘new normal’ as we clicked, browsed, and purchased up a storm.
Online shopping didn’t just become a way to buy – it became a way of life. And our new digital behaviours are here to stay. Global e-commerce sales are expected to top $5.5 trillion this year. NASDAQ expects 95% of all purchases to be facilitated by e-commerce by 2040.
Our shopping habits, and expectations, quickly changed. We now want personalisation, customisation, and a satisfying experience online on our preferred digital channel. We won’t stand for digital inconvenience. A frictionless experience wins hearts and wallets. Omnichannel has become table stakes.
Now, the ‘next normal’ in shopping’s future is taking shape as AI, machine learning and conversational AI give brands new ways to sell a relationship and an experience as much as a product, online and in-store.
Talk to the brand – Conversational chatbots
Voice-enabled smart speakers and voice assistants like Alexa and Siri paved the way for conversational commerce by driving consumer acceptance and adoption of voice search.
Now, ecommerce purchases made using voice technology are set to quadruple, from USD4.6 billion 2022 to USD19.4 billion in 2023 as increasingly sophisticated AI bots offer convenient, fast, simple access to 24/7 service with no waiting in line. They make recommendations, place and track orders, answer questions from product features to return policies, manage complaints, gather feedback, and monitor mood and sentiment.
Beyond voice – raising the bar in e-retail experiences
Other tech like augmented reality (AR) is transforming e-commerce too, enabling retailers to offer experiences from sensory stores to holograms of friends joining a virtual try-on session in a boutique.
Online marketplace Etsy created an interactive AR experience where shoppers ‘walk through’ a digital, interactive display home filled with curated Etsy items. It’s not window-shopping anymore. It’s immersive virtual shopping. Shoppers aren’t looking in, they are in.
Look Who’s Walking?
Amazon’s Just Walk Out Technology is a checkout-free shopping experience that eliminates the dreaded supermarket queue. You enter by scanning the QR code, hovering your palm over the reader, or inserting a credit or debit card linked to an Amazon account. Then fill your shopping trolley and leave without going near a checkout. The technology automatically detects when products are picked up or returned to shelves and keeps track of them in a virtual cart. Your purchase gets charged to your Amazon account and you get sent a digital receipt.
Revolutionising retail opportunities
For the retailer, AI and machine learning is revolutionising operations across the supply chain, from setting the ambiance in store and predicting real time demand, to optimising omni channel fulfilment, warehousing operations, pricing, markdowns, returns and store footprints.
Australian-listed online marketplace retailer MyDeal which earlier this year topped one million active users, will use real time 1-to-1 AI to recommend relevant experiences from more than 250 sellers to consumers at scale when it launches new activities platform, Amazed.com, later this year.
The adoption of AI and image recognition technology is helping keep Australia’s online shoppers safe too, with the technology being used by online businesses to automatically find and remove unsafe and recalled products from sale. More than 92% of product listings are identified and taken down within two business days of being deemed unsafe.
Namogoo uses AI-based predictive behaviour to replace generic promotions with in-the-moment incentives individualised for every shopper based on intent.
What next?
From 5G to the Metaverse, expect innovation to continue apace as retailers seek to up the ante in customer engagement.
The rollout of 5G wireless connectivity will enable seamless mixed reality experiences across a variety of connected devices for immersive shopping experiences.
Voice, AI, and AR will increasingly be used in social commerce to give brands new ways to engage with consumers on social media. This year, PepsiCo partnered with Snapchat in Australia to create an AR experience for the launch of 3D Dorito chips. A Face Lens opens up the Snapchatter’s mind like a triangle, revealing the chip. Once the head opens, the user enters a kaleidoscopic world of Doritos 3D.
Avatar fashion models will hit digital runways, giving brands new ways to showcase and launch collections while showing consumers how outfits and accessories look on different shapes.
The paradigm shift of the past two years has forged a new experience-centred, digital first retail realm, and there’s no going back. Consumers will increasingly find their voice and engage through conversational AI. The opportunity for brands is there for the asking.
Tracy Hubert, client services director at VERSA
