How Retailers Can Use AI to Build Stronger Customer Relationships and Drive Loyalty
It sounds nice to have robots (chatbots, and algorithms) do 50% of your workload, hence organisations ranging from manufacturing to martech are scrambling to incorporate AI into their processes. In reality, AI is already making major inroads into the sales funnel, shepherding new prospects, managing calendars, and drafting emails. Despite the effectiveness of AI-driven tasks, companies must make sure that they are directed towards one key goal: developing customer relationships.
Here are some ways retailers can use AI to build stronger customer relationships and drive loyalty:
1. Personalised Recommendations:
Thanks to AI, retailers can offer a more tailored shopping experience that makes customers feel seen and understood. This improves the customer experience and drives sales and loyalty. Plus, who doesn’t love getting those “recommended for you” notifications? It’s like receiving a surprise gift from a friend who just gets you.
According to a study by Segment, 49% of customers have made impulse purchases after receiving a personalised recommendation from a retailer
2. Chatbots:
AI-enabled chatbots can offer real-time assistance and 24/7 customer care by responding to questions from customers. This enhances overall customer satisfaction while lightening the load on customer care employees. Retailers may personalise client interactions with AI-powered chatbots, increasing consumer loyalty and happiness.
A report by Grand View Research estimated that the global chatbot market size is expected to reach $1.25 billion by 2025, driven by the growing demand for personalised customer interactions.
3. Predictive Analytics:
It’s like having a crystal ball that predicts what you’re going to buy next. This can assist merchants in personalising their marketing and sales efforts and in offering customers more focused and pertinent content. According to a study by McKinsey & Company, retailers that use predictive analytics can increase their operating margins by up to 60%.
4. Inventory Management:
May not sound like the most exciting thing in the world, but trust us, it’s essential for a good shopping experience. Thanks to AI, retailers can avoid the dreaded out-of-stock situation and ensure that the items you want are always in stock.
5. Fraud Detection:
AI can be used to detect fraudulent transactions in real time, reducing the risk of financial losses and improving customer trust. Retailers may increase the general security of their e-commerce platforms, increasing customer loyalty and happiness, by spotting and blocking fraudulent behaviour.
Retail use cases: How is AI being used by the big retailers?
1.Uniqlo Can Read Minds With AI- Uniqlo is using science and AI to create a distinctive in-store experience. They have installed UMood kiosks that use AI to monitor customers’ neurotransmitter responses to clothing colours and styles. The kiosk then recommends products based on each customer’s reactions, with no need for the customer to press any buttons as the system can detect their preferences from their brain impulses.
2.Sephora Makes It Easy to Find Makeup- Step into a Sephora store to find your perfect makeup shade without ever putting anything on your face. For foundation and concealer recommendations, Colour IQ scans a customer’s complexion, while Lip IQ does the same to assist in selecting the ideal lipstick hue. Customers who understand the difficulty (and expense) of selecting the ideal hue through trial and error really benefit from it.
3.Taco Bell Helps Customers Order Tacos On The Go- There is no time to waste if you want tacos. The first restaurant to provide online food ordering with AI was Taco Bell. Customers may text or speak their order with ease thanks to Tacobot’s integration with Slack. Even customised and large group orders are possible with the bot. After every order, the bot responds with witty comments in classic Taco Bell fashion.
In conclusion, the future of AI in retail looks promising, with the technology being used to create more personalised, efficient, and seamless experiences for customers. As AI continues to evolve, retailers that can leverage its capabilities to drive sales, build customer loyalty, and enhance operational efficiency will be well-positioned for success in the future.
