Conversational AI in Retail: Transforming Shopping & Store Management

conversational AI Retail

Conversational AI is the new frontier for retail, and it’s already being used by some of the biggest brands in the world. We’re already seeing chatbots being used by brands like Sephora and Nike, as well as other popular retailers. As the technology becomes more widely adopted, we’ll see more retailers using it to help their customers find what they want and get their questions answered in a simple way.

In this blog post, we’ll discuss how conversational AI can help your retail business and why you should be using it. We’ll also show you how to get started using this exciting technology.

Conversational AI is a technology that enables natural, two-way dialogues between people and systems. It’s becoming a popular way for companies to interact with their customers and employees.

Conversational AI has been used in many different ways over the years – including as a basis for translation software – but it’s only recently that we’ve seen it used as an interface for services such as home automation or smart speakers. The most famous example being Amazon’s Alexa assistant on its Echo device line-up.

Artificial intelligence (AI) is one of the most exciting and innovative technologies on the market today. It allows for software to learn and make decisions based on data, which has led to an explosion of different applications in industries like retail.

Conversational AI is a subset of AI that focuses on using natural language processing to enable computers to interact with humans. Instead of having to type out commands or use complicated menus, conversational AI lets you speak naturally with a computer and receive an answer in return.

What is conversational AI?

Conversational AI is technology that allows people to interact with computers using natural language processing (NLP) and speech recognition. The idea is that users will be able to speak with machines instead of typing or clicking on buttons.

Why do you need conversational AI in retail?

The main reason why companies are turning toward conversational AI is because they want their customers to feel like they’re communicating with a human being rather than an inanimate object such as a computer or smartphone. This makes them more likely to buy products from you because they feel at ease talking with you — much like they do when talking with someone face-to-face.

The benefits of conversational AI for the retail industry are numerous:

  • Conversational AI provides a more personalized experience for customers. It allows retailers to offer more relevant information to consumers. It can reduce shopping cart abandonment rates and boost sales.
  • It makes it easier for consumers to reorder products they’ve purchased in the past, which is especially useful when dealing with perishable goods like groceries or medical supplies.
  • Conversational AI can help retailers reduce inventory costs by providing real-time insights into what products are selling well and which ones are not selling at all, allowing them to make better decisions about what items they should stock on their shelves in the future (or remove altogether).
  • It reduces human error (e.g., misspelling) as there’s no need for typing long texts during conversation with chatbots or voice assistants.

Applications of conversational AI in retail

Conversational AI has many applications in retail. Here are just a few:

  • Personalized Shopping Experience – Bots can help you personalize the shopping experience based on what your customers want or need at any given time. For example, if someone is looking for an outfit that matches their company’s dress code, they can ask the bot if there are any items available in their size. The bot will then recommend some items that match their needs based on your inventory database and customer reviews.
  • Customer service support – For example, customers can chat with customer service representatives using messaging apps like Facebook Messenger or WhatsApp. This allows them to get answers to questions quickly without having to wait on hold or call into a call center. The system can also be trained to recognize certain keywords that indicate an issue, such as “my order” or “return policy.”
  • Order management – If you’re running a retail business that sells merchandise online, you probably have some kind of platform for managing orders and inventory updates. Conversational AI has been used in this capacity with great success. Instead of entering data manually into your system or asking employees to do it manually, the customer can simply send in their updates via text message or voice command through an app like Google Home or Amazon Alexa.
  • Inventory management – Retailers have always relied on inventory management systems to keep track of their product stock levels at every location on store shelves. Retailers can also use conversational AI as a way to help optimize their inventory based on consumer demand. By tracking what consumers are searching for on any given day, retailers can better determine which items need to be restocked at which locations in order to satisfy customers the most efficiently.
  • Retail analytics – Retailers are constantly trying to improve their operations by analyzing data from sales transactions, foot traffic patterns and other sources of information. Conversational AI can help retailers gain insights from this data by leveraging natural language processing algorithms that can identify keywords in chat transcripts or text messages sent through messaging apps such as Facebook Messenger or WhatsApp.

Tips to deploy conversational AI in retail

If you’re looking to deploy conversational AI in your retail business, here are a few tips to get started.

  1. Define the problem.
    What problem are you trying to solve? The more specific the problem, the easier it will be to develop a solution. If you can’t identify a specific problem, then you should start by asking yourself what you hope to accomplish with conversational AI. For example, are you trying to increase sales or reduce customer service costs?
  2. Identify the right channels.
    Once you’ve identified the problem that you’re trying to solve, it’s time to think about how you want customers to interact with your conversational agent. Channels include voice assistants like Amazon Alexa and Google Assistant; messaging apps like Facebook Messenger, Telegram and WhatsApp; or other communication platforms like Slack or Skype.
  3. Determine what type of interface works best for your customers.
    The next step is to determine which interface works best for your customers based on their preferences and usage patterns (e.g., mobile device versus desktop computer). For example, if most people use Siri on their iPhone when driving but prefer using Cortana on their desktop PC at home during non-driving hours due to convenience.
  4. Focus on user experience.
    A good conversational AI experience starts with the design of the bot’s personality. What is its tone? How does it respond to customer queries? How does it answer questions? Put yourself in your customers’ shoes and ask yourself how they want to interact with your bot. For example, if you’re a clothing retailer, consider how you would like to be treated by a sales associate when you go shopping. Would you prefer a personal touch, or do you prefer being able to browse on your own and make your own decisions? The answer will determine how you design your bot’s personality.
  5. Don’t overdo it with features.
    The more features your bot offers, the harder it will be for users to find their way around the conversation flow — which means they may just give up without ever getting what they need! To avoid this problem, start small: Design an experience that includes only one or two core use cases at first and then expand from there once users are comfortable with the core functionality.

If you’re looking for a technology partner or need expert advice on your next conversational AI initiative, we recommend taking advantage of our free consultation and get unbiased advice from our experts here.