What do AIs bring to retail today?

They paint pictures, write poetry, and even pass final exams from universities and chambers: Artificial intelligences (AI) are a fast-growing field with a wide range of applications in various industries. But what can these artificial helpers actually do that is already benefiting retailers in particular? This blog post explores the various ways AI can benefit retailers in Germany, including its use in supply chain management, marketing and customer service.

A power in process optimization and marketing

One of the most important areas where AI can be applied in retail is supply chain management. AI-powered systems can analyze large amounts of data in record time to optimize the supply chain, making it more efficient and cost-effective. For example, algorithms predict demand for products so retailers can adjust inventory levels accordingly. In this way, costly out-of-stocks and overstocks can be avoided. In addition, AIs can also be used to optimize logistics by, for example, identifying the most efficient delivery routes and predicting delivery times. This creates huge benefits for omnichannel retailers in particular, as demonstrated by fashion company SØR.

Another important area where AI can be used in retail is marketing. AI-powered systems can be used to analyze customer data, such as browsing and purchase history, to personalize the customer experience. For example, retailers can use AI to create personalized product recommendations for customers, increasing the likelihood of a purchase. In addition, AI can be used to analyze social media data to understand consumer sentiment, which in turn can be used to improve marketing campaigns.

A good example of how modern technology and algorithms can work together is provided by the fast-food giant McDonalds. For years, McDonalds has been using information terminals in more and more restaurants, which allow customers to order and combine dishes directly and individually. In addition, however, these panels are also used as upselling engines. The smart monitors know whether it is raining or a hot summer's day. Accordingly, they recommend coffee or ice cream to hungry guests as an add-on to the actual order - usually combined with an individual coupon or discount.

Will AIs soon replace customer advisors?

However, artificial intelligences can also be used to improve customer service in retail. Chatbots, for example, are used to support customers in real time, for example in answering questions or searching for products. More and more companies even prefer this way of interaction to classic call centers and customer service agents on call. According to a study by the company EOS, two-thirds of all European companies already rely on smart chatbots. But AIs can also be used to analyze customer service data such as call logs and customer feedback to identify areas for improvement.

In addition to these examples, there are many other opportunities for AI in retail in Germany. For example, AI can be used to analyze store traffic data to improve store layout and optimize staffing. AI can also be used to monitor and analyze employee performance, which can help identify areas where training is needed.

Unlimited possibilities?

The use of AI technologies can tangibly help retailers improve their operations while making customers happier. And that has the potential to boost their own sales and increase customer loyalty. However, it is important to note that implementing AI technologies requires a significant investment in terms of time, money and expertise. In addition, the ethical implications of AI, such as data privacy, should be considered and addressed.

In summary, AI has the potential to revolutionize the retail industry in Germany by improving supply chain management, marketing and customer service. Retailers that are able to use AI technologies effectively will be well positioned to succeed in the competitive retail market.