Best practices to transform retail order management with AI right now

And, as the lines between physical and virtual continue to blur, that includes virtual worlds. Vision Pro is essentially an augmented and virtual reality headset, but Apple prefers to bill it as a special computer because it has the power to blend digital content with the physical world. Apple says the Vision Pro has “more pixels than a 4K TV” and navigation is done through eye movements, hand gestures and voice-based commands; there are no physical controls for the Vision Pro.

AI is not just about futuristic technologies; it has practical applications that are already transforming the ecommerce landscape. From personalized product recommendations to dynamic pricing strategies and enhanced customer service with chatbots, ai technology is making the online shopping experience more personalized and efficient. Artificial intelligence and machine learning are becoming foundational to retail media strategies, particularly as brands and retailers seek ways to personalize experiences at scale.

In-store & in-app AR shopping experience

That’s why many retailers are moving from multi and omnichannel to a unified commerce approach. Yet, to provide a truly harmonious experience, companies must unify the structure of their tools and software architecture. For example, makeup and skincare retailer Sephora uses AI to analyze customer feedback, which helps ChatGPT improve product recommendations and store layouts by identifying trends and preferences in large data volumes. Imports of holiday products by US retailers, including Walmart, have fallen sharply, reflecting cautious inventory management and expectations for slower sales growth during this year’s festive season.

The retailer says that 75% of the Dallas-Fort Worth metro area will be eligible for drone deliveries by the end of 2024. On a broader scale, DoorDash is continuing to position itself as a retail delivery platform. In March 2024, Walmart announced they’d start making deliveries to customers’ homes as early as 6 a.m. Company officials say the technology provides them with “granularity and accuracy” that wasn’t available before they implemented AI. In both the handbags and active apparel categories, 15% of sales were driven by AI.

Retail Winners and Losers

Companies such as Danone utilize machine learning to refine demand forecasts and simplify planning across departments, thereby demonstrating the technology’s potential to boost operational efficiency. Madhulika Saxena is Product Director, eCommerce and Order Management, at Kibo, a market leader in composable unified commerce solutions. She has over 15 years of experience in leading product innovation for enterprise software solutions in the retail industry. Saxena’s previous product experience is in building retail planning solutions at Blue Yonder.

The idea of delivering online orders via robotic vehicles, with or without human supervision, is nothing new. These days, virtual assistants are able to understand natural language and context, which makes it possible to have ongoing conversations with customers and provide a level of service that wasn’t possible in the past. Shoppers can receive 24/7 support and may have their questions answered right away. And as social platforms evolve, agencies are increasingly hiring digitally native talent to meet the demand for social-first content programs. “A lot of the ads you see in retail media are very basic, very functional,” Howard says. He advises that focusing solely on short-term gains could lead to a decline in long-term brand building.

The retailer has also added localized areas to stores, which feature locally made and themed products, making customers feel like each store is their own personal store. Additional initiatives that DSW has implemented to drive traffic and increase engagement include its Soles4Souls shoe-donation program, adding coffee bars to stores and rolling out AI-powered try-on tools. There were also many conversations around the continued creation and departure of retailers, and how long-lived brands maintain the value that consumers desire. Retailers and brands that want to be successful must find ways to generate loyalty through products, experiences or technology that “goes to where their customers are,” whether they are in-store or online.

These chatbots can answer around 80% of daily questions, freeing up live support agents to handle more complex issues. By automating customer service tasks, ecommerce businesses ai in retail trends can provide a more efficient and enhanced customer experience. One of the most impactful applications of AI is in providing personalized product recommendations.

Shoppable video combines entertainment and commerce, and, overall, video continues to resonate well due to its immediate engagement and Gen Zers’ close connection to the format. Although video increases engagement, it often does not drive immediate transactions; still, it can translate to improved loyalty and an increased likelihood of later purchases. Video also enables retailers and influencers to better convey authenticity, which is particularly important with Gen Zers. Procter & Gamble (P&G) owns many of the most popular, iconic consumer brands worldwide, including Tide detergent, Crest toothpaste and Ivory soap.

You can foun additiona information about ai customer service and artificial intelligence and NLP. Retailers need to stay ahead of the curve, implementing strategies to counter deepfake threats and protect their brand integrity. Instances, including manipulated images of public figures such as the Pope and former presidents, highlight the potential for reputational damage. Transparency in AI applications is crucial to prevent discrimination and uphold consumer privacy. Companies that rely on casual AI to deliver the right experience to ” the right customer at the right moment for the right price, promotion or markdown are the ones that are poised to come out on top.

One in four of them (28%) claim it makes them a great deal more productive, and nearly half (46%) claim to be a fair amount more productive (see Figure 5). That said, this productivity boost may be limited to a narrow set of tasks at present. However, despite this, a vast majority of workers do not feel encouraged by their employer to use Gen AI – just 27% who are aware of Gen AI claimed that their employer encouraged its use. These figures suggest that there is latent productivity and worker satisfaction that employers can unlock if they invest in Gen AI tools, create governance structures and empower their employees. Unlocking that latent productivity can initiate a transformation of workflows and processes.

Ian Hunt, Director of Customer Services at Liberty London, sees AI as a key tool for delivering a curated and personalized service. Consequently, this initiative has contributed to an impressive 11% reduction in ticket resolution time. With more than 45 private labels, the retailer has garnered a cheap-chic perception from consumers and developed brands that offer everything from premium luggage to value-priced home organization pieces. One strategy is offering experiential retail, a shopping experience that’s memorable enough to develop customer loyalty. Shoppers often start their journey online and then visit a bricks-and-mortar store to check it out in person. A hyper-personalized experience is one in which the preferences and products explored in one channel influence their experience in another.

AI also helps retailers improve their in-person and online stores by assisting with skill sets they might not possess. This technology uses machine learning algorithms to monitor video feeds, identify suspicious behavior, and alert security personnel instantly. Jorge Argota, a digital marketing and SEO expert in Miami, said that AI has changed the shopping experience for his customers when it comes to gift buying. To succeed, grocery retail stores likely will need to develop strong private brands that rival famous name brands, while striking the right balance between quality, innovation, and affordability.

Gen Z shoppers are more likely to trust a live-streamer’s product review than a traditional advertisement, and successful retailers are following the eyeballs (and wallets) to these platforms. Artificial intelligence dramatically enhances operational efficiency by automating tasks, refining supply chain management, and improving sales forecasts. For instance, AI can automate customer support with chatbots, gather customer data, and follow up on abandoned cart inquiries, streamlining operations and saving time.

• This shift allows them to uncover deep insights into consumer behaviour, preferences, and market trends that were previously limited.
• Justin Fischgrund is the Founder & Principal of Fischgrund Consulting, a niche firm specializing in process improvement and technology strategy for organizations across industries.
• Some smaller retailers already have, such as quick service restaurant chains Panera Bread and Jet’s Pizza recently launching delivery via Zipline drones in select markets.

AI enables retailers to gain deeper insights into consumer preferences through trend analysis and persona building. By routing goods to the right place based on real-time demand forecasts, AI reduces the need for excess safety stock. This optimization ensures that products are available where and when needed, minimizing storage costs and improving delivery efficiency. This means that everything from in-store product availability to delivery times increasingly defines successful customer experiences. Dell NativeEdge, an edge operations software platform, can be a game changer for edge deployments. Plus, an open design and multicloud connectivity optimize investments by allowing retailers to consolidate new and existing edge applications on the same server.

For example, PayPal employs AI-driven fraud detection tools to analyze user behavior and transaction patterns, ensuring continuous improvement of fraud detection capabilities. To stay ahead in a highly dynamic market, retailers are actively considering how AI can help them meet evolving customer preferences, address labor shortages and drive sustainability efforts. AI has already proved to be a game-changer for retailers, with 69% reporting an increase in annual revenue attributed to AI adoption.

Explore our enterprise software products, open source solutions and accelerators on EPAM SolutionsHub. Specifically, these technologies enable predictive order promising, conversion probabilities, and complex queries of inventory audit or reconciliation reports. By 2024 the global average adult will be worth $100,000 and by 2026 there will be 87.5 million people with a minimum of $1 million in wealth, according to Credit Suisse. As more people become luxury consumers, exclusivity will not only be based on wealth, but also accredited to connections. Adweek is the leading source of news and insight serving the brand marketing ecosystem. What obstacles could be in store for the segment – and what strategies could unlock success?

A resale sub-trend worth keeping track of is retailers adding star power to their resale efforts by joining forces with celebrities emptying their closets. When asked about AI, 52.4% of customers believed that the use of AI would improve customer service, according to MarTech. To provide our creatives with inspiration [and] provoke thinking,” says Satoru Wakeshima, partner at CBX. He argues that the technology can help solve brand challenges and broaden creative expression. Secondly, with ML and AI advancements, voice-activated robots like temi can also be used in-store. Among others, they can be programmed to help consumers find product information, redeem promotions, or finalize purchase.

This understanding has enabled the company to grow faster than its markets for decades, even posting healthy growth rates in mature markets. We wrap up the event in this report, presenting our top insights across technology innovation, brand growth, the consumer, retail experiences and retail media. The future of retail lies in harnessing the power of AI to create smarter, more responsive supply chains that deliver value to both businesses and customers. This can be achieved through real-time measurement and optimization of existing processes, or retailers can find alternative solutions via scenario analysis to simulate changes to their supply chains. Companies that are able to implement technology-driven feedback loops are, on average, able to increase revenue by 3% to 4%, according to McKinsey.

A major concern for consumers is the potential for AI to perpetuate the spread of misinformation. More than 75% of consumers are worried about the impact that AI has on the ability to trust information found on the internet. Just two of the top 10 trends, namely employee engagement and customer loyalty, are not directly linked to AI, according to a press release on the report.

This is why businesses are rapidly integrating this feature into their application to prevent unauthorized access and create a safer working environment. Here are some powerful use cases of AI in cybersecurity that help businesses detect and respond to potential cybersecurity threats. Szanger says that CDW offers services to help clients with store closings and refreshes that include device reclamation and disposition, performed sustainably. Katherine Haan is a small business owner with nearly two decades of experience helping other business owners increase their incomes. That’s a top finding from a CX Network report that also noted AI is an enabler of other trends, such as automation and self-service.

Retailers are better able to collect and capitalize on consumer data to drive more customers to their platforms, analyze shopping trends, improve search results and optimize distribution with robots, to name just a few examples. AI is a key component of retail media implementation as retailers leverage customer purchase data to better target and personalize advertising. A lot of retailers wonder how the pandemic will impact customer demand with more brands turning to big data for demand forecasting. Accompanied by machine learning, it became one of the most effective and innovative ways for customer-supplier relationship optimization.

Looking at sell-through for an item across multiple locations, orders can be redirected to locations that fall below a sell-through threshold to prevent the item from going into markdown later. Using these capabilities, companies achieve faster inventory turnover while minimizing waste and markdowns, which improves profitability. Along with historical sales data, additional variables that impact demand can be considered to develop a more accurate demand forecast.

AI technology can keep up with simultaneous customer support requests around the clock. AI automates responses, reduces (sometimes eliminates) wait times, and personalizes interactions. AI detects and prevents theft and ChatGPT App fraud by monitoring in-store activity and identifying suspicious behavior, reducing losses. Drugstore chain Walgreens employs AI to analyze security footage and detect potential shoplifting incidents in real-time.

Multi-touch attribution models will gain traction, offering a broader perspective on the impact of retail media on brand performance. This will empower brands with actionable insights, allowing them to make data-driven decisions that optimize their retail media strategies. This omnichannel approach enables brands to interact with consumers in real-time, delivering targeted offers and product information even as they browse aisles in-store. Additionally, connected store environments allow retailers to gather in-depth data on offline shopping behavior, which can be fed back into digital campaigns to refine targeting further. The ability to reach consumers across both online and offline channels offers brands and retailers a holistic view of the customer journey, ultimately leading to higher engagement and conversions. AI has the potential to drive the next wave of growth in the retail sector, and new use cases are emerging all the time.

Building trust with customers is crucial to ensure the successful implementation of AI solutions. Segmenting inventory is a key strategy to ensure that each business segment has adequate inventory to fulfill orders. However, this is challenging, especially if you have multiple criteria you want to segment by – channel, fulfillment type, customer tier, etc. For example, you may want to ensure that your Loyalty customers who select BOPIS get their items readily while also ensuring that you are serving regular customers who want the items shipped. Retailers that use AI-powered tools to systematize picking and packing are significantly reducing the time it takes to fulfill orders. By automating repetitive tasks such as removing items from shelves and packing them into boxes, warehouses can handle higher order volumes without proportional increases in labor costs.

In the pursuit of enhanced customer experiences, retailers are focusing on reimagining physical stores. While generative AI has certainly accelerated some marketing use cases, it’s still a novel technology that is continuously evolving. For example, generative AI can uncover new personas and build creative, targeted content and campaigns within minutes. It’s highly effective in augmenting and accelerating traditional methods of marketing segmentation. However, it does not understand the cause-and-effect relationships and the “why” behind customer behavior. This differentiation is key in how causal AI helps retailers set a new standard for customer engagement.