AI in eCommerce: Inception and Beyond
19 Apr 2023
Hegsymol Raju
Business Analyst
Artificial Intelligence (AI) is no longer a futuristic concept – it’s an integral part of our daily lives. First introduced by John McCarthy in the 1950s, AI refers to the simulation of human intelligence in machines, enabling them to think, learn, and adapt to new information. AI has revolutionized industries across the board, from healthcare to finance to entertainment, with robots now able to mimic human behavior and decision-making processes.
These clever little robots use natural language processing (NLP) and machine learning (ML) to understand our questions and automate responses, making our lives easier and more convenient.
But AI isn’t just about making our lives easier – it’s also revolutionizing the world of eCommerce. Take Amazon, for example. Their voice-enabled eCommerce feature allows customers to find products, add them to their cart, and complete their purchase without ever touching a screen. It’s like having a personal shopper right in your living room!
And now, there’s a new kid on the block: ChatGPT. Using cutting-edge open AI technology, ChatGPT remembers previous conversations to inform its next responses. It’s like having a personal assistant at your fingertips, ready to help with anything you need.
So whether you’re chatting with a friendly chatbot or shopping online with voice commands, AI is changing the way we interact with technology – and the world around us.
“Your intellect may be confused, but your emotions will never lie to you” – Roger Ebert.
AI has come a long way since its inception, and Emotional AI is quickly gaining traction as a more viable proposition for businesses. Emotional AI is a subset of AI that enables computers to understand and respond to human emotions by analyzing data such as facial expressions, gestures, tone of voice, and keystroke force. It’s also known as Emotional Computing or Artificial Emotional Intelligence. The goal is to teach machines to better recognize human emotions and adapt their communication with humans accordingly. In other words, it’s an attempt to give computers emotional intelligence.
The eCommerce industry is highly competitive, and utilizing Emotional AI technology can significantly enhance the customer experience. AI-powered machines have an edge over humans in their ability to process vast amounts of data. By providing these machines with data on specific emotions and training them to recognize different facial expressions and tones of voice, eCommerce players can offer a more personalized experience.
Analyzing marketing efforts with Emotional AI is now considered essential for better customer experience and understanding consumer behavior. Human emotions are the primary drivers behind shopping patterns, such as what to purchase, where to purchase, and when to purchase. In fact, some researchers estimate that 95% of purchasing decisions are made unconsciously or instinctively. It’s no wonder that the market for emotion detection and recognition is projected to reach $43.3 billion by 2027.
1. Improving eCommerce and Customer Service with Emotional AI
By incorporating Emotional AI into customer service, agent-customer interactions can be greatly improved. Emotional AI can facilitate quicker issue resolution, establish stronger connections with clients, and promote a more positive attitude throughout the process. These outcomes will lead to increased customer satisfaction and overall happiness. Emotional AI empowers businesses to understand complex problems and their impact on customers, ultimately helping to build stronger relationships and demonstrate genuine care.
2. Real-Time Feedback: Driving eCommerce Growth with Emotional AI
In the world of customer feedback, quantitative surveys have rapidly become the preferred method over focus groups, qualitative approaches, and manual feedback analysis. They enable businesses to gather feedback from a large number of customers in less time and with less effort. As consumer needs and preferences evolve over time, shopping habits change, and emotions play a significant role in product search and purchasing decisions, particularly across different age groups.
Emotional AI empowers businesses to understand complex problems and their impact on customers, ultimately helping to build stronger relationships and demonstrate genuine care.
The importance of Emotional AI in eCommerce cannot be overstated. By providing empathetic customer service and personalized recommendations, businesses can improve customer engagement and increase sales. Emotional AI enables businesses to recommend the right products and services at the right time, ultimately leading to higher customer satisfaction and greater growth.
1. Customer insights
Knowing the customers thoroughly is one of the major challenges sellers face to sell their products. A Salesforce survey found that 66% of the customers expect companies to understand their needs and expectations, so the use of Emotional AI becomes really important in the eCommerce sector.
Revuze, a US-based startup, uses Emotional AI to provide digital commerce companies with customer insights. When a company launches a new product, gathering customer feedback usually requires hiring an outside research firm and can take up to six months. Revuze promises to do this faster by using Emotional AI technology to collect online text discussions about products and analyze them in a shorter time frame.
2. Testing
AI-powered testing is crucial for eCommerce businesses. Testing powered by AI capabilities, can analyze vast amounts of data to identify potential issues and improve the user experience. This testing can simulate thousands of users interacting with a website. It ensures that the website can handle high traffic volumes, with no downtime risk. AI also analyzes customer data to identify patterns, tailor offerings, and improve customer experiences. With AI-powered testing, eCommerce businesses can stay ahead, meet expectations, and drive growth.
3. Targeting
Delivering the right message to the right customer at the right time, in crucial point of every advertising effort is hard. Giving someone the wrong message at the wrong time can knock them out of your brand entirely. Emotional AI can be used to make sure this doesn’t happen.
More than a million people use the yellow line of the Sao Paulo metro in Brazil every day. And as they stand in front of the metro, Emotional AI is used to optimize the ads they see. Using feeds from security cameras, AdMobilize’s artificial intelligence emotion analysis technology classifies passenger expressions as happy, surprised, neutral, and dissatisfied. The ad then changes to adapt to what will be the best target for the passengers.
In conclusion, eCommerce continues to grow, businesses that leverage Emotional AI will be better equipped to understand their customers’ preferences. It also helps in making data-driven decisions, and create more targeted and effective marketing campaigns.
Cultural variations in emotions
It is difficult to reach reliable findings when AI isn’t sophisticated to recognise cultural variations in how emotions are expressed. For example, a smile may signify one thing in Japan and another in Germany. Businesses may choose poorly if these definitions are ambiguous.
Difficult to measure subjective qualities
Emotional AI will have limitations to capture some human emotions like that of self-determination. However, AI has some limitations it plays an important role in eCommerce. Customer Satisfaction will help businesses to understand their customers and thereby improve their services based on the real time feedback. In fact, Emotional AI solutions can truly help the retailers to deliver more user-friendly and satisfying products to the customers.
Time is not far when the potential of Emotional AI in improving the quality of services in the eCommerce. Domain will be widely recognised as a game changer by business and customers all over the world.