It is exciting how modern technologies are enabling product consumers to fuel online buying or check prices for certain products on e-commerce sites.
The retail industry is currently undergoing various advances that drive revenue, protect consumer privacy and drive shareholders’ value. Among these advances are cognitive computing opportunities, which are effective in helping online retailers to discover how to empower and reach more consumers.
Cognitive Computing in E-commerce
Cognitive computing comes into practice when a computerized system simulates human-thought processes. It also entails self-learning systems that rely on natural language processing, data mining and pattern recognition to emulate the normal functions of the human brain. In e-commerce, this technology provides online retailers with the relevant insights they need to meet the ever-changing and ever-growing consumer demands. It is becoming more popular in the online shopping world as consumer data continues to grow.
Advantages of Cognitive Computing in E-commerce
One thing that stands out in cognitive computing technologies is that they allow enterprises to accelerate and scale human expertise. These technologies are also gaining critical acclaim in the online shopping realm because they enable consumers to make rational shopping decisions and help the retail industry to realize new opportunities. To respond to this disruption, online retailers are on the verge of being visionary when it comes to using these technologies. Benefits that online retailers reap from cognitive computing are as follows.
Help Online Retailers to Evaluate Customer Data
Through cognitive computing, retailers can discover hidden patterns in their customers’ data. They can also use these patterns to customize a purchase based on a customer’s preferences. Once they have insights on their customers’ life events, color and brand choices, they are capable of delivering services, communications, and products conveniently.
Gives Customers Control over their Purchases
Consumers usually have lots of choices regarding what they want to purchase. These days, their purchasing decisions no longer rely on their location or time of making a purchase. Cognitive technologies offer them several self-help applications as they shop online. They can make use of information kiosks, self-checkout payment platforms, mobile payment apps and price checkers to improve their online shopping experiences.
Cognitive computing technologies enable retail store managers to carry out complex business processes efficiently. They also help them in identifying and reacting to issues and opportunities that require effective and fast responses. When retailers implement cognitive computing in their e-commerce models, it can help to uplift their online enterprises.
Improved Customer Interactions
There are cognitive computing applications suited for improving customer interactions. Their design allows them to provide online retailers with accurate, contextual and relevant data regarding broad aspects of their businesses. These applications are also instrumental in designing user interfaces for e-commerce sites that make it easier, smarter and enjoyable for consumers to shop online.
Exciting Cognitive Computing Opportunities that can improve the E-commerce Industry
Advances in cognitive computing technology focus on providing contextual, interactive and adaptive systems for decision-making processes in the e-commerce realm. These advances also allow online retailers to create quality experiences customized for individual customers. Discussed below are some of the advances in cognitive computing that are shaping the e-commerce sector.
IBM Watson Commerce
IBM Watson Commerce is a software program designed to empower both retail and online merchandisers to manage their business processes. It also targets marketers and category managers seeking to improve their customer engagement initiatives. The program uses Insights Assistant, an application with cognitive capabilities that helps merchandisers to identify abnormal conditions in their marketplaces and recommends appropriate actions.
It is the dream of every online retailer to know what items their customers would like to purchase in advance. This information can help them maximize their profits by determining the highest amount that a client is willing to pay for the item. It also helps them optimize customer service. Predictive analytics are turning these dreams into reality by offering online retailers predictions on customers’ purchasing choices. These analytical tools look at the various variables that can help in generating the desired engagement from the client such as clicking on an online product promotion of subscribing to a newsletter.
It is impressive how voice-activated digital assistants are changing how people browse the worldwide web these days. Voice-activated assistants such as Amazon’s Echo Alexa are revolutionizing the e-commerce sector. They allow consumers to make orders of their preferred products and have them delivered within a few hours at the comfort of their homes.
Direct Purchase through Social Media
Social networking platforms such as Facebook, Instagram, Twitter, and Pinterest are also driving up online shopping sales by providing direct purchase options. For instance, when you come across a product suggestion on your favorite social networking platform, once you click on the product’s picture, an application coupled with cognitive capabilities will direct you to the product page. This application helps to drive traffic to an e-commerce website and increase the consumers’ chances of buying a particular product.
Online retailers can also make use of recommender systems based on cognitive technology to provide their clients with personalized recommendations. The recommender systems focus on improving consumers’ personalized experience by providing them mobile notifications or e-mail newsletters regarding products they should purchase. They help retailers to gain complex insights into their product and customer bases.
Before the introduction of cognitive computing in e-commerce, online retailers had difficulties when figuring how much stock they can buy. They ended up buying excess stock that they sold at throwaway prices or buying less stock that couldn’t keep up with their clients’ demands. Luckily, demand forecasting can help these retailers make estimations regarding the future demands of their clients. There are a wide range of demand forecasting tools out there based on cognitive technology and machine learning that provide probabilities of future demands.
It is impossible for online retailers to accurately monitor or respond to the fluctuations of prices in their respective markets. This is because factors such as supply constraints, competitor pricing and customer demands are hard to predict. The good news is that online retailers can use price optimization tools based on cognitive technologies to make predictions on how their clients will react to the changes in prices of different services or products. These tools help e-commerce enterprises to meet their business objectives by maximizing their operating profit.
Most retail executives are certain that cognitive computing will lead to exciting opportunities in the retail sector. Retailers are also investing more resources in cognitive technologies. In the past, the retail industry relied on promotions targeting their audiences based on income, age, and gender. Today, advances in cognitive computing are enabling practitioners in this industry to be responsive and relevant to meet consumers’ expectations.
If you’re interested in more posts about e-commerce and retail, check out our complete report detailing how technology is transforming the both brick-and-mortar and online stores.