“AI is Bringing Conversation Back to Commerce” by Raj De Datta via Total Retail

“AI is Bringing Conversation Back to Commerce” by Raj De Datta via Total Retail

Credit: Getty Images by Vithun Khamsong

Even in its earliest form, commerce has always been centered around conversation.

The evolution to e-commerce seemed to de-center that conversational element, though. Without a person to speak with, conversation was relegated to a single place within the online shopping experience: the search bar.

As the only direct insight into what consumers really want, the search bar is a critical source of information for businesses — a place where 69 percent of shoppers begin their online journey. Yet for many years, the conversation shoppers were trying to ignite via their searches led to a mediocre experience at best. Much of the technology businesses were using to power their search engines simply didn’t understand what consumers were saying. And that was a challenge because two-thirds of consumers expect companies to understand their unique needs and expectations.

AI’s Role in the E-Commerce Conversation

Then artificial intelligence entered the world of e-commerce search, and with it came the ability to finally understand what customers were saying. With continued innovation, AI has allowed businesses to once more harness the power of conversation in the shopping experience. AI-powered semantic understanding, for example, can decipher the intent behind what a customer searches for — even understand the customer. It can hear what customers are actually asking for and give them the right answer, every time.

Conversations begin in the search bar and, for the most part, end once the relevant products have been displayed. Up until very recently, this was exactly what consumers were looking for in their online shopping experience.

But then came generative AI. And now customers and businesses alike have the opportunity to consider a fascinating question: What could be possible if those conversations didn’t end?

Related story: You Understand What Your Customers Want. Does Your Search Engine?

The Seismic Impact of Generative AI

Large language models (LLMs), which power generative AI, have broken down the barriers of what was previously possible in e-commerce. They can move us from a one-way to a two-way world, making it so that conversation begins in the search bar and continue everywhere — connected across text, email, app, even the in-person experience. The customer journey moves easily across every touchpoint, picking up where they left off no matter when or where they decide to re-engage.

This is the ultimate re-centering of conversation within e-commerce. It opens the door to unparalleled customer experiences and tremendous benefits for retailers, from continuous customer engagement to stronger loyalty and, of course, more opportunities to drive revenue. In 2022, 19.7 percent of sales occurred online. What could five years from now look like with conversation at the forefront?

The Bridge From Today to Tomorrow

The impact of LLMs can already be seen throughout commerce in content creation,  merchandising efficiency, product findability, and more. And while much of that impact is currently felt on the backend, it won’t be long until it vastly changes the way consumers interact with the online shopping experience.

That means retailers need to be preparing their e-commerce ecosystem for the coming AI reality. This includes cleaning up data and removing silos, and ensuring that data connects across their channels. LLMs like generative AI will fuel the conversations, but without the right data, those conversations will always fall short. It becomes an incredibly talented salesperson with no knowledge of your business. Or a salesperson that repeatedly asks you what you’re shopping for, even after you’ve told them at length.

Generative AI is set to become a retailer’s greatest asset in the race to drive online profitability — and that change will happen quickly. That’s a daunting proposition considering how new this technology feels. It’s an exciting one, too. This is an inflection point that will separate the leaders from the rest.

We, at Board Retailers Association, are here to help you to succeed by providing resources and programs that enable you to lower day to day costs, increase margins and create more remarkable customer experiences. We provide a voice for our Retail Members and will never share your information. BRA has been “protecting retailers and a lifestyle” for 20 years.

If you are not yet a BRA Retail Member, you can easily opt in to either Regular (no cost) or Distinguished ($100/yr.) Membership via this super simple join form