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Debunking the Myths Around AI in Retail

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Sean Brady, President, Americas at Emarsys here shares his second guest post with WhichPLM. Sean explores and debunks some common myths around one of the current buzzwords in fashion: Artificial Intelligence. Emarsys is a provider of marketing software, enabling true one-to-one interactions between marketers and consumers.

When terms like ‘Artificial Intelligence (AI)’, ‘Automation’ and ‘Machine Learning’ are so frequently tossed around, it becomes easy for them to lose their meaning. Retailers in particular have heard these words so frequently that they have taken on an almost mythical quality, serving as a cure-all for any problems retailers may face. While these terms have become somewhat overused, they really are changing the way consumer marketing is done – and online channels are at the core of this shift. It is important for retailers to bolster their understanding of how they can deliver benefits to customers through using AI, and be very open about how they are using the technology to drive personalization.

AI is a tool that can provide many tangible benefits to customers in the retail sector; it is much more than just a buzzword. But to clearly demonstrate this, the myths around AI need to be brought to the light and disproven.

Myth #1: AI will fix everything

AI is not a ‘silver bullet’ or a ‘cure-all.’ Too often retailers are led to adopt AI in their quest to deliver omnichannel excellence through an enhanced in-store presence, but quickly realize AI is only as good as the data you feed it. The goal shouldn’t be to simply say, “I’m using AI”, but rather, use it to connect all customer touchpoints, create sophisticated customer profiles, and incorporate other contextual factors such as weather and date in a way that helps inform more intelligent marketing strategies and sales forecasts.

To reach this level, however, retailers must first prepare their baseline, and there are tools which can help in this process. By using these advanced technologies wisely and in the right order, they will be more likely to keep up with competitors and adequately respond to growing customer demands.

AI is by no means a ‘one-size-fits-all’ solution, and it is not advisable to try to leapfrog from a standing start to full automation. There are numerous ways that it can be used to create a better experience for customers. In the fashion industry, retail giants such as ASOS and H&M have worked to incorporate AI into the customer journey in numerous ways. While H&M has launched a chatbot service nested in Facebook Messenger to help its customers shop its expansive range, ASOS has deployed AI to help shoppers establish their true size. Both methods deliver personalized experiences that improve customer interaction and minimize the number of returns.

Myth #2: AI and automation are the same thing

The biggest pitfall for retailers going forward is to think that AI is just an automation tool designed to help reduce workload. True, AI can bring a multitude of benefits , from forecasting and informing merchandising decisions to troubleshooting operational issues. But that’s not where the journey ends. Retailers shouldn’t overlook the use of AI to augment the customer journey, and create unique, individual pathways for each user. Not only does it work to establish good relationships with consumers, it also builds the trust needed to ensure customers continue sharing data with you. Only when you have a rich pool of information on your customer can you really deliver the one-to-one personalization they demand – whether in-store or online. AI helps you scale far more than automation by unearthing and implementing knowledge that can drive commercial success through happier customers.

Myth #3: AI will replace you

While AI will replace certain tasks and play a major role in automation, the function of brand positioning will in no way become obsolete. On the contrary, by taking on time-consuming, labor-intensive tasks and working data harder – through aggregation, analysis, recommendations and segmentation – brands will be able to invest their time and energy in refining customer journeys and sales strategies. AI will undoubtedly take on a bigger role in day-to-day operations, supply chain management, and in optimizing the sales lifecycle, but automation is no substitute for creative engagement with customers.

In the future, retailers will rely on AI to complement human interaction, by taking care of the digitally-led aspects of their brand and allowing them to concentrate on their first love: their brand’s overall purpose. After all, customers need stories to encourage them to actively engage with brands, creating true loyalty extending beyond the first one-time purchase.

It’s not a myth: AI is having an impact on retail

While the retail sector will be heavily impacted by AI in the future, its adoption has currently been stalled somewhat as retailers grasp its complexity and determine how to best apply the technology. It is important that retailers get started incorporating AI into their plans as quickly as possible, since this technology will drive the hyper-personalization that customers demand – and as we can see from our recent study, 41 percent of consumers will boycott a brand if it does not deliver offers and recommendations that are personalized to them. In order to achieve the ideal of true one-to-one personalization at scale, brands should begin forging ahead with AI technology, knowing that it will power their hyper-personalization efforts and, as a result, improve the customer experience.

Lydia Mageean Lydia Mageean has been part of the WhichPLM team for over six years now. She has a creative and media background, and is responsible for maintaining and updating our website content, liaising with advertisers, working on special projects like the Annual Review, and more.Joining mid-2013 as our Online Editor, she has since become WhichPLM’s Editor. In addition to taking on writing and interviewing responsibilities, Lydia has also become the primary point of contact for news, events, features and other aspects of our ever-growing online content library and tools.