The ultimate guide to AI personalisation in ecommerce

The ultimate guide to AI personalisation in ecommerce

Ecommerce has grown tremendously over the last decade producing $900 billion in sales for 2022 in the US market alone. It is projected to reach $1.7 trillion by 2027 in the US, with global retail ecommerce sales reaching $8.1 trillion by 2026. As sales grow, so does the number of online stores, with estimated 24 million ecommerce sites worldwide in 2022 catering to 2 billion digital buyers.  

Ecommerce is growing without a doubt, but the growth also leads to a wide range of choices that causes consumer fatigue. Customers with thousands of options eventually choose nothing, causing 70% of shopping carts to be abandoned. 

Furthermore, the highly competitive ecommerce industry compels brands to offer better shopping experiences if they want consumers to pick them among a sea of similar competing products. 

To address both fronts, ecommerce retailers naturally turn to personalised shopping experiences. AI personalisation is the key to capturing new users and driving repeat purchases. And with the advancement of AI solutions, ecommerce stores are poised more than ever to offer an exceptional shopper experience.

Why AI personalisation so important to ecommerce retailers

Personalisation is crucial for engaging shoppers, increasing repeat purchases, and boosting conversions. It’s a tried and tested strategy to drive sales and comes in many forms, such as personalised product recommendations. 

AI personalisation provides tailored experiences to shoppers that are relevant to their needs and better suited to their tastes. Instead of asking shoppers to mindlessly scroll through thousands of products to find the perfect match, AI personalisation uses customer data to predict the most likely item they’d buy based on past purchases, browsing behaviour, demographic data, and other data points. 

Predictive personalisation software now takes this one step further, and instead of waiting patiently for the consumer to come to you, it takes a personal selection. Based on buying history and impressions and navigation actions, to calculate imminent product selections and takes it to them, instead of waiting for them to come to you. Verified by all the leading research facilities, to deliver the highest ROI in ecommerce marketing. So if you haven’t got it, you are being remiss in your efforts.

Personalisation has the potential to create brand loyalty if executed properly, but if done poorly, it can harm a brand’s reputation. Therefore, it is essential to implement well-planned and effective personalisation strategies. However, with an overwhelming amount of customer data to process and analyse, knowing where to begin can be difficult. 

uThis is where the benefits and capacities of AI come into play. By leveraging AI technology, businesses can analyze large amounts of data to gain valuable insights into customer preferences and behaviour. This allows companies to create more personalized and relevant shopping experiences to increase customer satisfaction and loyalty and drive business growth.

The role of AI personalisation in ecommerce

AI is no longer the stuff of sci-fi movies and books. It’s becoming ubiquitous in our daily lives, with applications affecting every major industry, including online retail. With millions of customer data points, ecommerce is a ripe candidate for AI technology

Using artificial intelligence, brands can give customers personalized shopping experiences in seconds with little human intervention. 

AI personalisation uses machine learning, natural language processing (NLP), and deep learning to create personalised brand messaging or brand selections content, products, and services resulting in profitable customer journeys. Think of it as providing every customer with a personal sales attendant when they visit your store, or when you communicate with them. 

In a bricks-and-mortar retail store, sales clerks attend to every customer and recommend products based on the customer’s request and their analysis of the person. For example, if an older woman enters a boutique to purchase a blouse for work, the attendant will recommend conservative tops rather than casual crop tops.

AI personalisation accomplishes this for every customer instantaneously. As a result, each customer journey is unique, and site visitors are exposed only to relevant products. Again, with PPS, without them having to “go shopping”.selections with the greatest probability of being purchased are presented to them in their home autonomously, i.e. no stage are ever involved.

Advantages of using AI personalisation

AI-powered personalisation has several advantages over using basic personalisation methods in ecommerce.

  • AI mines and reads vast volumes of data so brands can access deeper insights leading to better and more accurate personalised customer journeys and customer lifetime loyalty.
  • AI improves ad targeting, leading to increased basket value that reduce marketing spend and increase revenue. 
  • AI generates smarter personalised recommendations for products that will go well with a customer’s current purchase leading to higher upsell revenues. Again more importantly, these are products with the highest propensity for being purchased, which also lowers the RoR.
  • AI creates a better search experience by understanding the nuances of human language so it can display relevant results before the customers even knows what they’re looking for. 
  • AI provides important customer data that helps brands refine their offers and processes to solve customer pain points and deliver an optimal customer experience. 

While personalisation has been around for a long time, artificial intelligence has elevated it to a new level, delighting customers and brands. Customers will find online shopping engaging once more rather than stressful, and brands will deliver a better shopping experience that boosts revenue.

Should you wish to validate PPS software on a free 30-day trial for your site, then simply register here.

SwiftERM is a Microsoft Partner company.

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