E-commerce businesses in Canada are using AI technology to observe and expertly analyze customer interactions and shopping patterns. This data is then used to guide strategies aimed at creating better shopping experiences.
AI helps you, as a customer, enjoy more personalized online shopping and makes product recommendations so enticing that they become hard to resist. This article highlights ten ways AI is changing e-commerce businesses in Canada and around the world.
- Identifying Optimal Pricing
One key area where AI has significantly impacted e-commerce is pricing. AI software can analyze vast amounts of data to find the sweet spot for pricing optimization. When e-commerce platforms can consistently hit that sweet spot, their profits increase, and so do your chances of finding the best deals.
AI-enabled dynamic pricing lets businesses adjust prices based on supply and demand, making the process much faster and more efficient. For instance, if a rival company runs low on a popular product, AI can detect this and alert the e-commerce platform to raise its prices or promote an alternative product.
- Making Site Search Smarter
AI is also making site searches more accurate. Natural language processing (NLP), an AI-related technology, helps e-commerce websites better understand the queries you enter. This means when you search for a product, the site can predict what you’re looking for and deliver more relevant search results.
AI can also improve searches through spelling corrections, adding synonyms, and even including missing words. For instance, if you search for “black running shoes for men,” the AI can automatically include similar phrases like “black sneakers.” AI also enhances voice and image search. Therefore, if you see a pair of shoes you like, you can upload a picture, and the platform will suggest similar items.
- Winning Shoppers with Personalization
In e-commerce, offering a personalized shopping experience can win you over as a loyal customer. AI allows businesses to tailor your shopping experience based on browsing history, preferences, and other factors. This resembles having a personal shopper who understands exactly what you like and offers you personalized discounts and suggestions.
According to McKinsey, companies that use personalization strategies see 40% higher profits compared to those that don’t. You’ve likely seen this personalization in action when you visit an online store, and it suggests products or offers based on your past purchases or browsing behavior.
- Making the Right Recommendations
AI-powered recommendation engines go beyond standard personalization. These systems analyze your browsing history and previous purchases to offer product suggestions that you’re more likely to buy. For example, if you’ve been shopping for electronics, the AI can recommend accessories like phone cases or chargers.
These recommendations make your shopping experience easier and more enjoyable, and for e-commerce businesses, they are a key driver of sales. If the recommendations are more accurate, you are more likely to make a purchase.
- Intuitively Cross-Selling and Upselling
When you add something to your cart, AI can suggest additional products that might interest you. This is known as cross-selling. For example, if you’re buying a camera, the AI might suggest memory cards, lenses, or a camera bag. On the other hand, upselling involves recommending a higher-priced item than what you’re considering.
AI uses data from other shoppers’ behaviors and your previous purchases to make these suggestions more intuitive. If the right product is available promptly, businesses can increase sales, and you might discover a product that fits your needs perfectly.
- Automating Customer Support
AI-powered chatbots are becoming essential in e-commerce customer support. These virtual assistants can answer your questions 24/7, process orders, and help resolve issues quickly. You might have interacted with a chatbot when you’ve needed help on a website — they’re those pop-up boxes that say, “How can I assist you?”
AI chatbots can understand your requests and machine learning through natural language processing to improve their responses over time. They handle routine questions, freeing up human agents for more complex issues.
As such, AI chatbots have come in handy, especially for huge e-commerce sites that receive millions of customers, such as online casinos in Canada. Generally, Canadian online casinos use chatbots to provide around-the-clock customer support to their players. This ensures that players get assistance at any time, which boosts their overall experience.
According to Statista, around a third of consumers consider chatbots to be very effective at handling questions, and they’re becoming more accepted in Canadian e-commerce as their performance improves.
- Streamlining Inventory Management
Inventory management can make or break an e-commerce business. AI is helping businesses avoid the common problems of overstocking or running out of popular items by using predictive analysis. AI looks at past data, current trends, and even outside factors like weather or holidays to forecast demand accurately.
This level of automation means fewer lost sales due to stock shortages and more efficient management of supply chains. For you, it means that products are more likely to be available when you need them. AI is also used in warehouses to manage stock by using bots that can store and retrieve items more efficiently.
- Increasing Conversion Rates
Did you know that abandoned shopping carts are a major hurdle for e-commerce businesses trying to boost their conversion rates? As a Canadian shopper, you’ve probably left items in your online cart at some point without completing the purchase. AI helps tackle this issue by collecting data on your browsing behavior and shopping patterns, allowing businesses to follow up when you abandon a cart.
For example, AI can trigger an automated email to remind you of the items you left behind, often with a special discount or offer to entice you to return and complete the purchase. This personalized approach helps reduce customer churn and significantly increases conversion rates for e-commerce platforms.
- Reducing Manual Labor
AI improves the customer experience and takes care of repetitive tasks behind the scenes. Whether processing orders, managing customer queries, or tracking inventory, AI can handle many of the mundane tasks that would otherwise require manual labor. For example, AI-powered chatbots can field basic customer inquiries, while machine learning algorithms handle stock management, ensuring that the correct items are always available.s
