AI and Ecommerce Personalisation

October 7, 201913min

Customer Experience is shaping the future of ecommerce.

AI is no longer science fiction – it’s real present-day technology and many ecommerce businesses are already using some form of AI to understand their customers better and provide an enhanced CX.

2019 is shaping up to be the year that AI becomes truly prominent in ecommerce. Investment in AI and machine learning is increasing across the board, just as the developments in technology are expanding the range of uses. According to IDC, the global retail industry is set to spend $5.9 billion (£4.45 billion) on AI systems this year.

AI is changing how people find products and shop online; there are systems that can analyse millions of daily interactions to create targeted incentives to individual customers.

In a highly competitive and dynamic marketplace such as ecommerce, the drive to integrate these emerging technologies is accelerating. AI has the power to be a game changer in ecommerce by pushing CX to the next level. Virtual assistants, product recommendations, voice search, and augmented reality are just some examples of these technologies. 

AI is a trend, but it is not a fad, so brands that wait to implement it into their business will rapidly find themselves eclipsed by their forward-thinking competitors.

What can AI do for your ecommerce store?

It’s predicted that ecommerce businesses that personalise successfully could see profits rise by 15 percent by 2020 (source: Gartner).

There are various ways of capitalising on AI and machine learning platforms for your business but the most significant advantage of AI is the level of hyper-personalisation that becomes available to your customers.

The demands of online shoppers are evolving at a spectacular rate, faster than human retailers can respond to them.  Consumers now expect personalisation as standard as they are used to experiencing it on a daily basis. For instance, the recommendations Amazon and Netflix make based on the user’s prior interactions. Eighty percent of watched content on Netflix comes from algorithmic recommendations, according to findings by Mobile Syrup.

Meanwhile, McKinsey found that 35 percent of Amazon’s revenue is generated by its recommendation engine. Your business may already be collecting data on the online behaviour of your visitors but vast amounts of data can be overwhelming and pretty useless if you don’t know how to analyse it for the purposes of putting effective strategies in place.

An effective AI system has the capacity to filter through petabytes of consumer data to predict online behaviour, and offer individually specific recommendations that are buyers find relevant. This level of intelligence is vital in delivering a personalised shopping experience to the consumer.

Quite simply, stores that have not deployed ecommerce personalisation will lose out on revenue. Brands that engage this tactic can transform their online stores in a way that serves the customer’s needs and best interests. And do it efficiently and even cost effectively!

Humans cannot compete with AI when it comes to deconstructing big data. AI facilitates multiple ways to segment your audience to gain intelligent insights that allow retailers to personalise in a range of different ways.

  • Product recommendations: Algorithmic recommendations that update in real time, depending on the visitor’s behaviour. Buyers expect the ‘you may also like this’ feature to show items that are relevant to their tastes. Personalised merchandising sorts the product display to show customers products that genuinely appeal to them.
  • Personalised website content: Presents visitors with various configurations of online content according to their personal preferences. This can even include personalised navigation of the site, with a personalised home page, which is proven to increase conversions.
  • EA (Evolutionary Algorithms, a subset of AI): This can carry out sophisticated content testing and optimisation at a rate that humans simply cannot, by assessing which layouts and content drive the highest conversion with different customer segments and then configure the online experiences to the individual in real time.
  • Customer-centric search: Using tools such as natural language programming, searching online is becoming more intuitive to what the customer is actually looking for during online searches.
  • Currency auto-detection: Detects and presents the correct currency for your visitors and converts the prices accordingly so there are no surprises or extra steps for the customer.
  • You can even use AI to tackle fake reviews by finding and removing bot generated reviews by competitors. Negative reviews and lack of customer trust impacts sales. Ninety percent of shoppers surveyed said that positive reviews influence their online buying decisions. 

Brand benefits

The benefits of creating such a personal and convenient Customer Experience are vast. By increasing the level of visitor engagement through recommendations and customised content you reduce bounce rates, improve conversions, and increase sales. And better still, generate repeat business.

These tools eliminate the need for time-consuming content testing, and reduce the amount of money spent on ads. They can create valuable efficiencies across operations that free up precious time to focus business at the strategic level. An AI engine that continuously monitors all devices and channels has the ability to create a unified universal customer view; for the first time its possible to deliver a seamless cross-device and cross-platform experience.

AI systems can be integrated with digital marketing solutions and can be utilised to build unique customer experiences that are consistent across all marketing channels.

For instance, since implementing AI, clothing brand Footasylum saw a 28 percent increase in email campaign revenue from hyper-personalised marketing communications.

Marketing copy that speaks directly to the customers based on their purchase history, search queries, and page visits, is an extremely effective tool for cart recovery and post-purchase promotions. Abandoned cart emails achieve a 4.64 percent conversion rate, according to Proteus Themes.

Personalised ads on social media as a tool may not lead to people buying directly from the SM platform but they do drive relevant traffic that increases conversion rate so should not be left out of the AI strategy.

Privacy and ecommerce personalisation

Of course, the price of hyper-personalisation to the customers is their private data, but even cautious shoppers will part with their intimate details for a high level of customisation and ultra convenience.

Building value-based, trusting relationships with your customers is essential for long-term loyalty, so remaining fully transparent on how and why you collect people’s data and the security levels in place are vital.

Invespcro found that 57 percent of online shoppers are comfortable with providing personal information to a brand, as long as it directly benefits their shopping experience.

Chatbots and virtual assistants

Chatbots are a machine learning technology that interacts with shoppers in a chat environment simulating human conversations. Chatbots and virtual assistants are being deployed across online retail to mimic the personal touch of a shop assistant.

They learn and evolve to become better at assisting the visitor with customer service needs and product queries. They can even be trained to say ‘thank you’ and ‘sorry’, making them more forgivable if they do frustrate a customer.

Chatbots present an effective and low-cost way of providing customer service, 24/7, which reduces the need for expensive humans. Virtual assistants are impacting the way customers make purchases and provide retailers with a creative opportunity to deploy across the customer journey.

Where to start?

Investing in AI may still seem like an enormous undertaking, but there are several ‘off the shelf’ platforms available, many of which offer 30-day free trials. By testing out different applications on your site, you can see which works for your business. The real question is, can you afford not to invest in ecommerce personalisation for your business?

The smart approach is to do so with the intent of ensuring your customers feel personally valued and focus on providing them with an engaging and seamless shopping experience that will build long term brand loyalty.


Rory OConnor

Rory OConnor

Rory O’Connor is CEO and Founder of Scurri.




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