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8 Smart Ways to Use AI For Your Online Store
Michael Hall
January 11, 2022

When someone talks about artificial intelligence, the first thing that pops up in your mind might be an image straight out of a sci-fi movie.

However, when it comes to ecommerce, it’s a different ball game altogether! It’s all about learning technologies and algorithms that form the foundation.

AI is building a strong niche in every sector, from unmanned cash registers to tech-enabled security verification at airports, to 24/7 customer support. AI sure has a major role to play in making our lives easier.

AI isn’t just another technology to take the ecommerce world by storm. It has the potential to massively impact most industries today.

AI can take your business to new heights. If you are an online retailer, AI will help you make sound decisions and enable you to accurately predict the future by using collected data relevant to your business and customers. AI can help you deliver an optimized user experience on and off your ecommerce website.

Over the years, AI technology has evolved into a powerful tool to improve business operations and boost sales. Even small business owners are using technology with some sort of AI capability.

More than anything… AI does what machines do best so humans can do what humans do best.

Why is AI important to Ecommerce?

Amazon has always recognized the benefits of AI and related technologies. The ecommerce giant uses machine learning to improve logistics, product selection, and customer experience on the whole.

When you first set up your online store, you probably never imagined that one day you may have to work alongside robots!

Well, that day is here now in the form of AI and machine learning.

AI is going to have a huge impact on the ecommerce sector. With data indicating that the ecommerce industry is ripe for AI investment.

Let’s take a look at the many ways in which AI can benefit your ecommerce business.

1. 24/7 Customer Support

Ecommerce businesses can now provide 24/7 customer support to shoppers, track shopper behavior and collect valuable data, all with the help of AI’s machine learning and advances.

Adding a chatbot to your website can do wonders for your store!

With a chatbot in place, you can improve your customer service, instantly respond to queries, offer them personalized and satisfactory answers and get them closer to making a purchase.

2. Improved targeted Marketing

Personalization is the need of the hour! But only 15% of retailers have implemented it across various channels.

Deep personalization techniques will help you customize content by the user. With advances in AI and machine learning, customer interactions can be tracked and purchase history can be analyzed to learn what shoppers want and send out the right message that will resonate the most.

3. Automation

The goal of automation is to get a task done with as little human interference as possible. It could be anything from scheduling emails in a marketing tool or automating tasks on Zapier.

AI can play a huge role in helping you automate repetitive tasks and improve your store’s functioning.

The Different Applications of AI in Ecommerce

While there are several benefits of artificial intelligence in ecommerce, here are the popular use cases of AI in ecommerce:

Personalized Product Recommendations

It’s easier now than ever to gather and process customer data about their online shopping experience. AI is capable of providing nuanced product recommendations based on a plethora of data, most notable in the era of new privacy restrictions is zero-party data.

Today, online retailers depend a lot on machine learning to collect data, analyze and use it to create a personalized experience for their shoppers.

Price optimization

AI and machine learning techniques can be utilized in many ways to optimize prices. Optimal and competitive pricing arises from customer preferences.

Self-learning AI-powered algorithms analyze huge amounts of data and recommend the best pricing options.

The longer a business uses its algorithms, the more accurate the suggestions get. This is because AI solutions learn from historical data.

With the right data at hand AI tools can predict when and how many discounts are necessary for the sale.

Voice Assisted Shopping

Ecommerce virtual assistants offer valuable support for customers searching for products in your store. They help you improve customer service, improve user experience, and site usability.

As a busy ecommerce business owner, you may not have the time at hand to reply to every message that comes your way.

Hiring people to do the job can turn out to be expensive, hurting ROI.

Plus, it would be humanly impossible to attend to every customer 24/7, across all time zones, despite having a large customer service team.

Bots acting as virtual assistants put to use machine learning and natural language processing to do various tasks. These virtual assistants can handle product research, image editing, product listing, and inventory.

People who visit your store can get the information they need in no time.

Amazon introduced Alexa Voice shopping after the success of the Alexa device. It allows you to review the best deal on Amazon and place orders, using your voice, as anyone with an Alexa-enabled device is likely painfully aware of.

Inventory Management

An effective inventory management system is all about maintaining the right amount of stock that can meet the market demand.

The traditional form of inventory management focuses on current stock levels. However, AI-enabled inventory management helps to manage stocks based on data related to:

• Past sales trends

• Estimated changes in product demands

• Any supply-related issues that could affect inventory levels.

Apart from inventory management, AI is also being used in warehouse management. AI Robots can be used to maintain and sort through stocks 24/7 and initiate immediate dispatch for orders that are placed online.

Revenue Forecasting

Revenue forecasts have implications as they drive annual budgeting and planning cycles.

Revenue forecasts have to be accurate and timely. Without an accurate revenue forecast, your company’s top management will not be able to decide on whether to:

• Introduce new products and services

• Invest in hiring, marketing, and infrastructure

• Explore new markets

When inaccurate forecasts are made, firms tend to budget and invest inaccurately resulting in poor financial performances.

AI can help your business deliver quick and accurate forecasts. Machine learning algorithms can automate the entire forecasting process for you, reducing cycle time and effort.

What these algorithms do is that they operate on demand to build performance forecasts for businesses and alert them with timely warning signals.

AI-based Site Search

When you shop online you may have come across product results on your page that doesn’t match your requirement and are irrelevant to your search, many a time causing you to leave the site in frustration (we call this search abandonment).

Here is when AI comes to the rescue!

To handle this situation, AI uses Natural Language Processing or NLP to contextualize and improve search results to present you with the best match to your product, making it possible for you to quickly find and shop for your favorite things.

Customer Service

Chatbots have enabled the ecommerce industry to offer 24/7 customer assistance. These voice-assisted bots can handle all the frequently asked customer queries and provide all possible solutions to them, helping customers make buying decisions.

An automated chatbot can help retailers improve their conversation rates by creating a personalized online experience for customers without having to do any extra work.

Image Classification

As a shopper, you would have come across something that you liked and wanted to buy but didn’t know what it was called or where to get them from.

Fortunately, that’s another way AI makes a difference. AI classifies, interprets, and understands images making it a lot easier to find what you didn’t even know the name of.

Top examples of AI in Retail

Today, leaders in the retail industry are leveraging artificial intelligence and machine learning to deliver seamless shopping experiences to delight their customers across multiple channels.

Let’s take a look at examples of AI in the retail arena.

The Olay Skin Advisor

Courtesy of Business Wire

The Olay Skin Advisor uses AI and machine learning to analyze shoppers’ skin and problem areas from just a selfie.

All you have to do is answer a few questions about your skin and the AI tool will offer you a personalized product recommendation from Olay in no time.


A top fashion retailer, ASOS uses AI to improve customer experience. Its AI team has developed a machine learning model that recommends clothing to shoppers based on what they have purchased or returned in the past.

Retailers look to reduce return rates which are an inconvenience to shoppers. ASOS’s AI tool analyzes which products and sizes shoppers return and which ones they keep, to make the right size recommendations for future purchases.

Final Thoughts

AI is playing an important role in ecommerce, steering innovative solutions that deliver seamless customer experiences. With its ability, AI offers its clients quick access to information which is harnessed to help them make data-driven decisions that scale up sales while simultaneously reducing overhead costs.


Hero photo by Charles Deluvio on Unsplash