In the fast-paced world of e-commerce, businesses are constantly on the lookout for new ways to improve their customers' experiences. And with global e-commerce sales expected to reach upward of $7 trillion worldwide in 2025, finding the right technology to keep up with customer expectations has become more critical than ever.
Enter Conversational AI (Artificial Intelligence) – an exciting technology that has been making waves in the retail landscape and transforming online shopping as we know it.
What is conversational AI?
Conversational AI refers to using chatbots, virtual assistants, and other advanced technologies to enable human-like interactions through text and voice-based communications. It leverages machine learning and natural language processing to deliver tailored support, sales, and marketing experiences to customers.
Powerful conversational AI use cases in retail
1- Simplifying product search
Conversational AI is revolutionizing the way consumers search and discover products. Because this technology understands shoppers' queries expressed in their own words, it creates a speedy product discovery experience that takes people from browsing to checkout in just a few short steps. For retailers, this significantly cuts down on the amount of time it takes to convert searchers into customers.
2- Providing personalized recommendations
In today's retail world, conversational AI can be thought of as a digital sales associate, but with one major advantage: It can connect to multiple data sources at the same time. Omnichannel AI bots can collect mountains of customer data and show new patterns and connections related to customer behavior — something that wasn't possible with isolated touchpoints. Armed with this information, It can curate personalized recommendations and suggest relevant products for shoppers, creating a more tailored and interactive shopping experience that increases customer engagement and loyalty.
3- Streamlining the checkout process
The average online shopping session has a whopping cart abandonment rate of 70%. Part of this has to do with the fact that most online checkout experiences are lengthy and complicated. Here, conversational AI can help by introducing a more natural and interactive checkout experience. Instead of customers dropping off at the final stage, conversational bots can be deployed during checkout to offer reminders about coupons and personalized incentives, as well as answer questions related to payment methods. This helps improve customer retention, boost conversions, and ultimately increase sales.
4- Supporting customers 24/7
Conversational AI often has the upper hand over its human counterparts when it comes to efficiency. It can work 24/7/365; it doesn't need sleep, breaks, or vacations, which means that your customers will always get the help they need, when they need it. It can answer FAQs, provide product information, troubleshoot technical issues, and, when necessary, transfer to a live chat agent for further assistance. This helps reduce wait times and keeps customers happy.
5- Collecting customer feedback
Most business owners know how important it is to stay in tune with their target demographic's preferences. And often, this means having to revamp their offerings to remain relevant. One problem, however, presents itself: How do you find out what customers really want? With conversational AI's ability to understand natural speech, it can infer what customers liked and disliked about their shopping experience and how it can be improved. This is not to mention that since it usually interacts with customers in an informal setting (i.e., chat), most customers are more than willing to share their honest, unbiased opinion about a product or service.
6- Analyzing customer sentiment
Conversational AI not only collects customer feedback, but it also reads between the lines for sentiment data. This means that it can detect positive or negative sentiments in customers' conversations and flag them for further review. In doing so, it enables businesses to both identify problems and address them before they spiral out of control and, at the same time, capitalize on the positive sentiment to create and replicate more delightful experiences.
7- Qualifying sales leads
Conversational AI can be instrumental in qualifying leads and identifying high-quality prospects. This is because its ability to approach potential customers in a friendly, non-sales-y tone enables it to ask all the right questions to learn more about their needs, interests, and pain points. It can then use this information to qualify leads, determine which ones are more likely to close, and disseminate this information to the sales team for further nurturing. This allows sales teams to focus their efforts on the most promising prospects, improves lead conversion rates, and ultimately boosts the return on investment (ROI).
Putting it all together...
As you can see, conversational AI stands to bring tremendous value to the retail industry, and it's only just getting started. Its e-commerce applications continue to grow every day, which explains why more and more businesses are incorporating it into their digital strategies. According to a recent report from Market and Market, the global conversational AI market size is expected to grow from $10.7 billion in 2023 to $29.8 billion by 2028 — all due to its ability to transform customer experiences. So if you're looking to capitalize on the power of Conversational AI, now is the time to start.
Source: Centro
