Artificial intelligence (AI) has seen more widespread adoption in recent years, and AI in retail is no exception. This sector has benefitted from more streamlined operations, improved resource management and greater customer satisfaction as a result of the introduction of AI.
But where does its future lie? Here, we'll be looking at the future of AI in retail, and what that reality might look like.
1. Checkout-free stores improving retail business
One of the most innovative ways in which AI is already shaping (and will continue to shape) retail is the introduction of checkout-free stores. The retail industry is one that's predicated on making a customer's experience as straightforward and simple as possible. Arguably, there's nothing simpler than walking into a store, picking up the product you need, and then leaving again straight away.
Reduces financial losses with machine learning retail software
It's thought that, in the US, over $37 billion could be lost every year as a result of long queues at the checkout. The AI technology used in checkout-free stores typically combines both machine learning and state-of-the-art sensor technology (with smart shelf tags) to enable customers to purchase whatever they like by just picking it up from the shelf, and leaving with it. All that's typically required is an app to check in and out of the store.
2. Improved inventory management with artificial intelligence
Efficient inventory management is critical to the success of any good retail business. AI in retail has the ability to drastically improve this area. From using machine learning and smart shelves to notify employees when stocks have run low, to using predictive analytics to make seasonal demand predictions, artificial intelligence can help more efficiently stock shelves. That way, there are simultaneously fewer empty shelves, as well as fewer occasions when food or other products are overstocked and go to waste.
3. AI is helping revolutionise customer experience in retail
Every retail business wants to keep its customers happy. In fact, that's one of their most important goals. And with the help of artificial intelligence, retail companies are continually able to improve their relationship with their customers, as well as improve the customer experience overall.
Tailored product recommendations
How, exactly? Well, firstly through offering more tailored product recommendations. Artificial intelligence software utilises a range of algorithms to filter the most appropriate products for a customer based both on their own individual shopping history, as well as the customer shopping trends more generally.
Integrating AI and AR
Another area in which artificial intelligence is improving the retail customer experience is through the integration of AI with augmented reality (AR). While many would love to spend all day, every day browsing the rails and trying on outfits, it simply isn't feasible for most people. It just takes too long.
Now, though, with the help of AI and AR together, customers are able to "try on" different outfits without physically putting them on; likewise, people can try out different makeups with the help of AI and AR technology, without the need to actually apply the makeup physically. Not only do these technologies save customers time, but they also reduce the risk of returns down the line (in the case of clothing).
4. Enhanced supply chain management across the retail industry
Supply chain management is another core tenet of the retail industry and one in which artificial intelligence can make (and already is making) a big difference. With AI solutions, it isn't just in-store inventory management that's improved, efficiency is enhanced across the entire supply chain.
Improving warehouse operations
Historically, logistical and operational tasks, such as capacity buffering, demand forecasting and order processing have all been overseen manually. With the help of AI technology, however, these (previously time-consuming) tasks can all be automated, and constantly improved upon with the help of machine learning models.
With AI technologies, pick-and-pack processes become more streamlined, managers and other human employees have more of their time freed up to focus on other tasks, and with the help of robots in the warehouse, the level of inherent risk associated with working in a warehouse also decreases, contributing to a safer, happier workforce overall.
Making logistics and distribution smarter
It isn't just the warehouse branch of the supply chain that's improved, either, but the logistics and distribution side of things, too. AI systems have been developed to improve fleet driver safety, for instance, with the ability to detect both speeding and driver fatigue, and offer real-time alerts to drivers so that they might take the appropriate actions, eg. stop and rest, slow down, etc.
AI technologies are also enabling a retail company's fleet vehicles to be better monitored. Everything from mileage to tire tread can be monitored, recorded, and, with the help of AI, analysed so that predictive maintenance can be facilitated. Unexpected downtime as a result of vehicle failure can be costly for a retail company, so being able to stay on top of a vehicle's condition better than ever before is critical in helping the supply chain run as smoothly as it's supposed to.
5. An increase in voice search and image search
Today's retail customers expect to be able to search for their desired products online however they wish. With the introduction of both voice and image search functions, that expectation is being met.
Image search
Instead of desperately trying to guess the right keyword for a product you like the look of, and wasting half an hour in doing so, AI-powered visual search enables the customer to simply upload an image of the product (or type of product) they're after, and they'll instantly be met with the best-suited, corresponding product page.
To do this, the AI utilises something called computer vision which enables a computer to scan and detect what's in an image - in this case, for instance, a clothing product. It's another tool that a retail business can use to elevate customer satisfaction and generate a quicker shopping experience.
Voice search
With machine learning (ML) retail AI, voice search is also being made smarter. According to Oberlo, over 70% of consumers prefer voice searches to keyboard queries. And although it might not be quite as popular as image searching when it comes to retail, AI and NLP (natural language processing) algorithms are becoming ever more adept at returning the kinds of search and shopping results people are looking for when searching by voice. So, don't expect it to go anywhere anytime soon.
Final thoughts
So, there you have it. Five areas in which AI is currently shaping retail, and will do so in the future. If this has interested you, why not consider one of our short courses on AI, like Artificial Intelligence and Machine Learning Masterclass? AI has already had a huge impact on our world, the question is - do you want to be somebody who helps shape it?
With a UTS Open short course or microcredential, you can upskill in AI and machine learning in as little as 10 weeks and create better future for yourself, and potentially the world!
