AI is transforming the retail industry, but can offer many benefits to small businesses
From changing the method Customers search for products sparks debate over the increased use of Famous advertising campaign AIthe impact of AI on the retail industry is clear.
The pace of change may seem challenging for small retailers who lack the large budgets of corporate counterparts, but there is a real opportunity for these businesses to leverage AI to save money and time, maximize team potential, and maximize the market for today's consumers in a powerful way.
What types of tasks are retailers trying to improve with AI? According to Arnaud Gallet, director of the National Retail Federation's big show Europe, the key to leveraging AI in small businesses without a huge budget focuses on “highly impactful use cases of low banks that improve efficiency and customer experience.”
Large scale AI personalization
Large scale AI personalization is a perfect example of this type of use case. “What previously required customers to pull out customer data, build manual segments and write dozens of message variants can now be done by one person with a few clicks,” explains Adil Wali, Chief Product Officer of Marketing Automation Company Klaviyo.
Using AI can help you create “smarter, more detailed segments based on behavior.” The advantages of this approach are clear, with improved conversion rates and increased customer satisfaction compared to more traditional blanket messaging methods by manufacturers of blanket messaging, regardless of current and past behavior. As Wali says, “it's about unleashing the kind of marketing that builds lasting relationships, not just efficiency.”
For small businesses, this is to “level the playing field… surface insights that were previously hidden in data.” It's not going to replace a team of people. Previously, they added capabilities that were out of reach for small and medium-sized businesses. Teams can respond in real time and provide customers with a more personalized experience that feels more premium.
AI to improve the efficiency of repetitive tasks
The most important opportunity for small businesses is to streamline or enhance some of the most basic and repetitive tasks while improving the overall customer experience.
“Practical starting points include using AI to generate or improve product descriptions using tools like ChatGPT, Jasper, Shopify Magic, and more, SEO improvements and time savings,” Gallet shares.
Gallet emphasizes that everything from FAQs and basic support tasks can be outsourced to an “AI chatbot.” In contrast, you can help store staff by “keeping up “dynamic FAQs” and helping articles on platforms such as conceptual AI” and “enhancing AI-powered apps on tablets or smartphones with instant access to product information and inventory levels.”
While these may not be the most innovative applications for AI, they offer the advantage of being practical, easy to implement, and simple to measure in terms of efficiency improvements.
As Gallet explains, “Common threads are not flashy technology. They are the wise and customer first application of AI that respects brand voice and customer trust.”
AI and declarative Commercial
Software Company Shopify not only improves the efficiency of repetitive tasks, but also experiments with “declarative commerce.”
Deann Evans, Managing Director of Shopify at EMEA, describes declarative commerce as “instead of directing software to set up campaigns or edit stores,” instead “can “express what you want to achieve” what you want to achieve, such as creating campaigns that attract new customers and allowing technology to receive execution care.
This shift goes from “command” to “intention” and is behind Shopify's New Horizon theme. This allows users to “authorize the design, simply explaining their vision.”
“This new approach, not just manual tasks, but also platforms address business goals, could be the next major inflection point in retail strategy,” Evans said. It is also a perfect example of how AI can make life easier for small business owners who don't have time to want results without explaining technical details.
Retail AI-transparency builds trust
While AI offers huge advancements to small businesses and enormous opportunities to improve efficiency, according to Gallet, there are important considerations that should be taken into consideration in order to incorporate AI to avoid “bringing customer trust and weakening brand image.”
“This includes using clear editorial guidelines to ensure that AI-generated content is faithful to the brand's universe,” he elaborates.
Another important consideration? Transparency. “You should notify customers when AI is used, especially in automated customer service or personalized campaigns.”
Large retailers have already navigated this and serve as inspiration. Gallet highlights online retailer Zalando. This emphasizes that AI is transparent about when and how it engages, while using AI to solve real customer issues such as size and fit.
Retail's AI-Ai-Ahead
Small and medium-sized businesses need to navigate the potential pitfalls of AI, but there is a great opportunity for AI to make them more efficient and profitable by taking actions such as enforcing clear policies to properly collect and use data.
AI offers the ability to “enhance loyalty, streamline discovery and create seamless on-site experiences without the need for vast technical budgets and expertise.”
And with declarative commerce becoming a reality, she imagines, “It's reimagining it when you see merchants simply expressing their goals and seeing their tools and systems adjusting the changes they need throughout the business.”
