Retail is concerned with sales and profitability, and the discounts that incentive the customer to buy. CRM and rewards programs are already seeking to establish store loyalty. The next step is to leverage AI to improve promotions by personalizing beyond the seasonal items, due to having access to one’s shopping history. How can AI help? You may ask.
There is a human response question: Will this be seen as being helpful, or will it be seen as a scary invasion of privacy? Many gift delivery shippers (flowers, chocolates, etc.) already know personal shopping schedules, and send out reminders without causing us much concern. A store-specific coupon for a large bag of pet food, timed to be offered when the previously-purchased bag should be fully consumed, might have a high response rate. However, some items, like anti-fungal cream and wart remover, may embarrass or otherwise disincentive the typical consumer if asked whether they enjoyed and would like to order another for 10% off, resulting in lost customers. It may also prove beneficial to experiment with phrasing and discount rates. The results can then be data based on BI calculations of response rates of different item types, phrasings, and discount rates to help determine future sales strategies.
Big ticket items may have logical follow-ups, ranging from check-ups (snowblower tune-up for $50 this November!) or maintenance items (engine oil for the lawnmower). When a car dealer is seen for check-ups (and they’ll know what kind of service is needed need based on the mileage), expect discounts to be sent for tires or brake pads or other items, based on wear and tear details from the last visit plus math calculations.
Media sales may utilize AI to calculate recommendations, saying “If you liked THIS, you may also like THAT”. For a book or movie, why not push the sequel? For music, a book or a movie, why not push something similar, which may mean the same creator or theme. Of course, if the purchaser gives the item a bad review, there may be no point in recommending something similar.
Data entries can be created to ensure through testing to validate and verify if the correct logical AI conclusions are reached. While the strategy of employing AI to improve customer response is can give your store an edge, it all falls apart if the AI logic does not work correctly in practice.
Source By: QualiTest Group