by Jan Goller
What impact does technology have on the retail sector? This question has been discussed a lot in the recent years and stays still unanswered. Some people even have referred to the ‘apocalypse’ of the sector caused by online shopping. But thanks to artificial intelligence (AI), companies in the retail sector will move from a “preventive” business model to a “predictive” model. This will help them to be much more efficient, according to the report “AI, the future of Retail” presented by the Spanish Association of Digital Economy (Adigital), ICEX and Kairos. AI can improve the customer service and optimize the production processes of retail.
Artificial Intelligence as the only and great ally of Spain
Nowadays, digital technologies cover all spheres of our lives. This technology and in particular the latest advances in big data, machine learning and artificial intelligence, can become the only and great ally of trade in Spain. This is the main conclusion of the new report about the impact of AI on the retail sector. It tries to understand how AI will revolutionize the sector making a review of current main trends as well as of challenges and opportunities for small and medium companies.
Every time when we use technical devices we leave our fingerprint there – day be day. Humans have generated in the last 5 years 90% of the total data that existed back then, says the report. An appropriate treatment of that data means a more efficient management of a company’s ressources. These could be for example the production optimization or staff management. But above all, the data affects the purchase experience and customer loyalty.
8 key opportunities that artificial intelligence offers to the sector
- Tailor made: understand every time better the user’s needs to offer solutions that provide a differential value proposal, and do so in real time, with the ability to adapt to the changing needs of the consumer.
- Logistic optimization: thanks to its potential to help to predict the purchases of users in real time, artificial intelligence allows more efficient management of production stocks. Therefore, adjust storage needs according to demand.
- Creation of one unique channel: 1 out of 5 online purchases involves offline search processes. Conversely, 1 out of 3 purchases in physical stores is preceded by consultations in the online world. Companies will have to unify all channels to treat the consumer as a single user.
It allows you to know the preferences of your customers
- Virtual interfaces: the new digital assistants use the voice. This will be the main interface used in the sector. Thanks to this technology, businesses will be able to interact with their users in the same way that two people would do. So they can build a more fluid and direct relationship between them.
- Optimal location: the huge amount of data that we manage will allow us to establish what would be the best location of a commercial premises. Then it is possible to know the flow of customers’ movement like the days and hours of the week of greatest demand.
- Staffing: by identifying the hours of greatest demand, the business can more accurately predict how much staff it needs at anytime and from what profile.
- Improvement of the customer service. Companies will move from single manufacturing to offer maintenance services, advice, training upgrading. The aim is to improve the consumer experience and provide a long-term relationship based on trust and experience.
- Delivery time. Thanks to the ability of companies to anticipate demand, they can improve their distribution times and be more competitive.
In retail, as in many other sectors, we do not talk about digitization, either by itself or by default. It is not a trend or a fad. Technology gives us access to a large amount of information and gives us innumerable opportunities to be more proactive. Brands have to be ready to respond to the needs of increasingly demanding customers if they want to build a long-term relationship with them, highlights José Luis Zimmermann, CEO of Adigital.