Over the past few years, Artificial Intelligence technology has made some interesting advances in multiple industries. While this may not be so obvious to end users, artificial intelligence has also been applied to the retail sector. While not every retailer uses it due to its high costs, accessibility and ownership systems, the biggest players in retail are very active about it. No wonder, then, the benefits that AI brings to real businesses.
How Can Artificial Intelligence (AI) Help?
How Can Artificial Intelligence Help Retail Store Owners? First, a few words about how AI and machine learning work. Namely, artificial intelligence technology takes some of the big data, runs it through AI algorithms like neural networks and then generates a model that can provide answers like a real human being. The answers given are based on what AI can learn from the dataset.
As this is evident at the moment, the dataset that AI learns in the retail industry paradigm is actual sales data linked to customer data. When this information runs through machine learning algorithms, an AI model is generated that does not explicitly or explicitly inform the business owner of action information about the business, customers, and inventory. With this in mind, a retailer can do a variety of things to benefit its own business.
For example, retail AI can learn about customers, their preferences and their behavior to get to know them. And, in recent years, it has made them better aware of what they need and when they need it. They know this even before they do. When AI is able to generate such information on the fly, it can immediately reap many benefits for business cash flow and general experience. The first is for the customer to buy more. If the AI knows what they need before they do, and issue a coupon for a given product, this will motivate them to buy the extra item they don’t come across while generating extra revenue for the business. Another benefit is enhancing your customer’s experience because if you offer them what they need at a good price, you will start building a personal sales relationship with your customers.
Another area where retail AI can help is how to physically place items in the store. We have all heard stories about how retail chains are ordering goods to buy more. And I think we all have some magic formula through which we can display our inventory and buy our customers more. However, there is no such formula. A single store with a single item but in a different location has completely different triggers for its customer base. So there is no one-size-fits-all solution here. However, what is available is artificial intelligence technology.
When presented with sales data, machine learning can find patterns in your customer’s buying preferences and learn what they buy together. Based on this, AI will give you advice on what your customers need to keep next to your store to buy more. And because those suggestions are based on real data provided by real customers buying in a particular store, they are guaranteed to deliver results and motivate your customers.
There is much that AI can do for retail businesses. The examples listed above are just the tip of the iceberg. No matter what part of your business, you can provide data; AI can truly uncover valuable insights that can be treated like gold. It can be used to improve your inventory turnover, optimize your stock, predict future earnings, and more.
There is a catch. As they are, artificial intelligence systems are mainly owned and available only to large retail chains that have large technology budgets. It will be interesting to see this space in the next few years, as solutions come out that are designed more for smaller retailers than for larger retailers. Some companies have already started this development, so the independent retailer will not have much time to access the same tools as the national brands.