March 22, 2017

Artificial Intelligence Takes Hold for Retailers

artificial intelligence

It’s been a big week for Watson, IBM’s computer system that applies artificial intelligence to improve businesses in industries ranging from healthcare to retail. At IBM’s Amplify conference (#Amplify2017), the company has been showing off Watson like a proud parent. As reported in MediaPost, retailer Harry & David, a SIM Partners client, has been using Watson to create more a more personal shopping experience. As noted in the article,

In the case of the Harry and David brand of 1-800-Flowers, finding the correct gift was the target objective, which led to the creation of a Watson-powered gift concierge that sorts through 7,000 products to find the most appropriate gift.

Our take: Artificial Intelligence is changing the retail experience — and rapidly. Businesses are using AI to create stronger efficiencies and customer experiences in a number ways, such as:

  • Improved image-based searching capabilities, which is crucial to help customers browse through deep catalogs by finding products that look like products a customer is interested in buying. How often have you been on a website and wondered, “Why can’t I just show a picture of the shirt I like and find shirts like it?” Businesses are using AI to do just that.
  • Personal shopping services such as the 1-800-Flowers gift concierge, which tailors suggestions by learning about customers and matching their interests more intelligently with gift ideas. Other businesses using these kinds of concierges including Victoria’s Secret.
  • Wayfinding in the offline world, as the Mall of America has been doing during the holiday shopping season with its ELF app, which uses conversational technology to help shoppers find the best locations inside the mall for products.
  • Improved service through more accurate inventory forecasting and replenishment, as Grocery chain Morrisons is doing in the United Kingdom.

You don’t need to go all in to win with AI. First ask how you can improve your location marketing experience, such as complementing your offline stores with stronger online browsing and shopping, and improving your brick-and-mortar stores themselves. The above examples are just a few ideas to get started. We’ve also shared how AI was a big takeaway at HIMSS 2017 as more healthcare systems and health IT companies are finding new uses. Is AI influencing your marketing strategy? How are you using AI to create a better location marketing experience?


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