How Artificial Intelligence is Changing Customer Service for E-Commerce Stores

Woman in red sweater shopping online

According to a 2019 report by Gartner, the number of organizations that adopted Artificial Intelligence (AI) in the last four years has grown by 270 percent. Every day, as technology continues to evolve, businesses worldwide are implementing AI into their operations.

The e-commerce industry is not far behind either. After benefiting from custom software development, IoT solutions, and many other tech tools, e-commerce is now on a fast-paced track to AI. From marketing to operations to customer service, e-commerce businesses are using the tools and technologies of artificial intelligence across all segments.

But artificial intelligence is not just about using fancy technology and algorithms to supplement the backend business. E-commerce is presumably one of the first industries, with leading companies such as Alibaba and Amazon using AI to enhance customer experiences while shopping online.

To find out how artificial intelligence and its sub-branches, such as data analytics services by Vates, are making a difference in the e-commerce industry, read this blog. We’ll tell you some amazing ways AI is changing the dynamics of customer relationship management in the e-commerce sector.

Person holding a green card saying AI

Some Background of Artificial Intelligence

But let’s look at the history first.

In contrast to popular belief that artificial intelligence is a new technology, the history of AI goes as far back as 1957. However, the high costs of the technology made it workable only for large companies, wealthy governments, and scientific institutes.

Today, some may think of AI as a sci-fi movie concept. The truth is that modern-day artificial intelligence is fairly easy to invest in, acquire, and benefit from.

Artificial Intelligence in Today’s World

Here are some of the technologies of artificial intelligence that you can see in today’s world.

Big Data Analytics

Big data analytics is presumably the most popular domain of artificial intelligence. The world is producing over 2.5 quintillions of data every day, with each individual producing 1.7 MB of data every second. Artificial intelligence and big data companies such as Vates have helped businesses utilize this data and turn it into actionable insights to improve processes and cut costs.

Machine Learning

Machine learning is another sub-branch of AI. With the help of machine learning, businesses can improve decision-making, tap potentially lucrative markets, and benefit from a future-forward approach. ML, along with AI, is changing the way businesses conduct their operations in today’s world.

An industrial robot at work

Natural Language Processing

Natural language processing is a type of artificial intelligence that helps computers interpret human language the same way a person can. NLP has evolved the conversational AI market to such an extent that this segment alone will be worth more than $13 billion in the next two years.

Chatbots/Virtual Assistants

Chatbots and virtual assistants are also redefining the business dynamics. This branch of artificial intelligence is particularly useful for e-commerce businesses keen to simplify the online shopping experience with voice-command-based systems integration. Virtual assistants like Mona or chatbots are two of the most sought-after AI technologies in customer service.

Virtual Reality

Virtual reality is not just about robots anymore. Globally, businesses, especially those in the e-commerce industry, are using VR technology to enhance the shopping experience. With time, VR is helping online stores replicate the same kind of experience as a brick-and-mortar store.

Close up shot of a persons blue eye

How AI Can Improve Customer Service in E-Commerce

You may be a world-class e-commerce store with the most sophisticated software development and backend technology. However, these are the customer service advantages you’re missing out on without AI.

Personalized Recommendations

The biggest advantage of artificial intelligence in the e-commerce industry is the personalization of recommendations. While a brick-and-mortar store only collects data from what a customer buys, e-commerce stores have the chance to know what the customers are looking at.

With the help of expert data consultants at Vates, e-commerce stores can improve their product recommendations for customers based on AI-collected insights.

Voice Commands

Almost half of American internet users use voice command features to navigate the internet. Artificial intelligence-based NLP tools can help e-commerce businesses attract all those customers looking for voice interaction with a site. From simplified searches to instant queries, AI can help e-commerce stores tap into a larger audience.

Instant Customer Support

Another one of the AI tools that we discussed above was chatbots. On the one hand, we have traditional customer support tools that allow humans to interact with humans. This is often an expensive and time-consuming setup. On the other hand, chatbots can cater to hundreds of thousands of queries instantly, thus reducing the response time and offering faster customer support to online shoppers.

Smooth Navigation

With the help of AI and big data insights, e-commerce stores can also simplify their UX and software integration. This is particularly helpful for older shoppers who are hesitant to use online shopping sites on the back of complex interfaces and tricky navigations. AI allows businesses to personalize the dashboard for every customer or improve predictive analysis for easier accessibility to desired products.

Person shopping on an e commerce site on a tab

Supply In-Demand Products

Seeing the trends of what customers are looking for or what a particular customer buys every time, AI can help e-commerce stores better manage their inventory. This means that a customer will never turn away to another store or a brick-and-mortar store upon not finding the desired product.

With the help of big data consulting firms such as Vates, e-commerce stores can leverage data to improve their inventory and supply chains.

Optimize Costs

Amazon was able to exponentially grow its revenue on the back of cost optimization every ten minutes. This is because Amazon used AI tools and data analytics metrics to keep an eye on the most sought-after products, promptly supplied those products, and maintained a lower than market price to attract customers. AI can help optimize costs to attract customers and generate higher sales.

Minimize Hiccups

Online shopping is rapidly growing globally. However, there’s still a segment of customers who are wary of shopping online due to technical hiccups and glitches. AI can help e-commerce stores get rid of problems such as poor inventory, lack of customer support, and delayed deliveries.

Improve Data Security

Data security remains a top concern whenever a shopper logs in to an e-commerce store. Although there are IoT solutions that help e-commerce stores improve their security mechanisms, AI is also leading the way here. With the help of AI and data analytics tools, e-commerce stores can strengthen their security protocols and filter out malicious activities effortlessly.

Person looking at a mobile based e commerce store

Enhanced Shopping Experience

Gone are the days when shoppers turned to brick-and-mortar retail stores to enjoy the shopping experience. Now, with the help of virtual reality tools, businesses can also enhance their shopping experience online.

E-commerce stores can help shoppers feel the fabric, smell a scent, or interact with a product before purchasing it. All these features of AI have made over 51 percent of businesses adopt it in recent years.

How Artificial Intelligence Can Help E-Commerce Businesses

AI is not just improving customer service for the e-commerce industry. It’s also helping businesses in many other ways. Take a look to find out.

Reduce Operational Costs

Many businesses report a reduction in operational costs, workforce, and product development after using AI tools.

Improve Customer Development

On the back of big data insights, businesses can improve customer development and facilitate product development.

Increase Employee Productivity

Businesses using AI to automate processes have reported an increase in employees’ productivity. This also leads to higher talent acquisition and lower employee turnover.

Automate Customer Service

Instead of hiring people, training them, and spending hours on slow-paced customer service. E-commerce stores can now automate their customer support with the help of chatbots.

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Enhance Marketing

E-commerce stores can also benefit from AI when it comes to retargeting old customers and retaining them. Alongside, IoT consulting companies such as Vates also use AI to help e-commerce stores find their target audience.

Engage Customers Strategically

Like a brick-and-mortar store, an e-commerce store has an assortment of customers. There are millennials who prefer voice-command features, and then there are older adults who like to see humanized versions of e-commerce chatbots. AI can help businesses engage with each customer according to their individual preferences.

Generate Higher Sales

Using AI has resulted in higher sales for 52 percent of businesses. E-commerce stores can also benefit from AI’s potential and churn out a higher revenue than the rest of their competition.

Leverage Technology, Data, and More with Vates

Vates is a leading South American software development company that offers IoT solutions and services, big data consulting services, and software testing services. You can get in touch with us today to learn about our AI-based solutions, IT services, and software development services.

We are based in Argentina and are a renowned nearshore software outsourcing firm for businesses in the U.S. Our clients are, however, spread across the globe and trust us for all their IT-related needs.




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