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How Artificial Intelligence is Revolutionizing eCommerce

Last updated July 7, 2023 6 min to read
Artificial Intelligence in eCommerce
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It’s official: artificial intelligence (AI) is taking over eCommerce! By 2025, Gartner predicts 95 percent of all customer interactions will be powered by AI.

If you’re wondering what the hype is all about, read on. We’ll review the current state of artificial intelligence in eCommerce, and its benefits and applications for your business.

5 benefits of artificial intelligence for eCommerce

There’s a good reason for the high adoption rate of AI in eCommerce. It has a lot to offer eCommerce sites. 

1. Deepens customer loyalty

Through its ability to process millions of customer data points quickly, AI software can provide hyper-personalized experiences for shoppers, driving customer loyalty and higher cart totals.

eCommerce brands who offer personalized experiences see revenue gains between 6 to 10 percent. That’s up to three times faster than brands who don’t.

2. Helps you make more sales

Intelligent systems for eCommerce can personalize everything, improving your content and product recommendations. Product recommendations represent up to 31 percent of eCommerce revenue.

3. Lowers costs

Artificial intelligence tools for eCommerce aren’t free, but they significantly lower your staff costs and make previously manual processes much more efficient.

Take eDesk’s magic wand feature, for example. eDesk is a specialized eCommerce helpdesk, so it processes millions of customer service tickets every day. Using AI technology it’s able to use this data to identify the type of incoming query and suggest a suitable response. This means all users have to do is to click on the suggested response and they can resolve customer support tickets in an instant.

Rather than hiring more staff, sellers can simply increase their support capacity using eDesk.

4. Improves your data

One of AI’s big selling point is its data processing capabilities. Thanks to machine learning and natural language processing (NLP), artificial intelligence can gather, process, and spit out suggestions for a range of eCommerce needs, from product promotion to supply chain management.

That speed and insight translates to real revenue: eCommerce sites using AI enjoy 30 percent higher sales growth than those who don’t.

Related article: Are you Spending Too Much on Logistics?

5. Enables smarter marketing

Thanks to all that data, artificial intelligence can make eCommerce marketing more intelligent, too.

For example, with Google’s responsive search ads, brands can upload a handful of visual assets, headlines, and ad copy. Then, Google uses AI to test different combinations and determine which creative performs best for which queries, resulting in up to 15 percent higher click-through rates

Google AI powered ad copy suggestions
Google uses artificial intelligence to suggest ad combinations. [Source

How can online sellers use AI

Today’s eCommerce sellers are infusing AI throughout their business operations. Three key opportunities include customer service, inventory management, and product discovery.

Chat with shoppers

According to estimates from Gartner, chatbot use has grown from 2 to 25 percent in just the past three years. Chatbot technology unlocked 24/7 customer service and virtual personalized shoppers for eCommerce brands. These two functionalities highly desired by customers, but very costly to do manually. 

Chatbots use natural language processing to understand free-form customer questions and respond appropriately. They can be pre-programmed with responses that make them feel more human and fit an eCommerce brand’s voice.

eBay launched their eBay ShopBot in 2016. The chatbot helps shoppers find what they’re looking for, answering questions and providing product recommendations.

Shoppers can also upload a photo of something, and the ShopBot will search for products with similar images. The ShopBot remembers each customer it speaks to and personalizes future conversations based on that information. This exemplifies perhaps the most exciting thing about chatbots:  the more they interact with customers, the smarter they get.

eBay ShopBot
eBay ShopBot helps sellers to find what they’re searching for using artificial intelligence. [Source]

Related article: 14 Essential Hacks to Increase your eBay Sales in 2020

Smart inventory management

Good inventory management is a balancing act between stocking enough to meet demand without creating excess inventory. 

With AI inventory management, eCommerce sellers can toe that line with precision, using real-time data and smart recommendations. Artificial intelligence inventory systems track trends over time, allowing sellers to uncover seasonal sales trends, more accurately predict changes in demand, and better manage their supply chain.

Nicknamed “the Amazon of China,”JD.com is a massive eCommerce retailer that’s used artificial intelligence to grow its eCommerce operations in recent years.

In 2018, they opened their first automated warehouse, manned by only four people who use a fleet of drones and robots to fulfill 200,000 orders daily. By combining AI software with robot technology, they can automate much of their warehousing and order fulfillment processes. They use robots to stack, pack, and ship merchandise, drones to deliver it, and software to oversee inventory and demand. 

Artificial intelligence in eCommerce fulfillment software
JD.com opened their first automated warehouse in 2018.

Related article: What are the Biggest Online Marketplaces in the World?

Personalized product discovery

Artificial intelligence analyzes customer behavior across different systems and touchpoints, from your retail POS to your website. Using this data, AI tools for eCommerce can predict what products to recommend to which customers, when, and what marketing channel has the best chance of conversion. 

Amazon Alexa, and her friends Siri and Google Assistant, are prominent examples of AI-enabled product discovery for eCommerce. In addition to answering random questions about the weather or who starred in a Netflix show, these voice assistants track their owners’ shopping and search behavior, allowing the platform (Amazon, Apple, or Google) to surface smart advertising, content, and product recommendations to them. 

Amazon’s own recommendation engine, which delivers personalized recommendations based on a customer’s search behavior, accounts for 35 percent of consumer purchases on the platform. With Amazon Personalize, Amazon has made that recommendation engine available to eCommerce brands worldwide.

Amazon personalize

What AI software already exists for eCommerce businesses?

The market for AI software for eCommerce is growing. Here are a few options to consider for your eCommerce site:

Chatbots

Chatbots can provide customer support, product recommendations, and more. On Facebook Messenger, you can even have your chatbot push marketing content if followers opt in. 

Helpdesk Software

Artificial intelligence in eCommerce helpdesk software gives sellers a huge advantage when handling customer communications. As mentioned earlier, eDesk can suggest relevant responses based on insight from hundreds of millions of support tickets. It also will automatically assign tickets to the best suited agents, enhancing the effectiveness of your team.

Email Marketing Software

Rather than manually developing all of your email drip campaigns, AI email marketing software for eCommerce can automatically send emails to your subscribers, with content and promo codes personalized to each recipient—optimizing subject lines and send times at the same time!

Related article: 20 Essential eCommerce Marketing Tactics

Logistics

Machine learning can facilitate warehouse management and supply chain automation. AI warehousing software can use your sales data to determine the best time to schedule deliveries, how to package and send products, and when to reorder stock. This allows your business to work smarter, while lowering your logistics costs.

Related article: eCommerce Warehousing: Everything you Need to Know!

Image recognition software

Help more shoppers discover your store with visual search from Pinterest. Pinterest users can click an item in any photo they see online, and Pinterest uses image recognition software to serve up similar product images. Pinterest isn’t alone in using this technology (Google Lens, Macy’s, and several clothing retailers have also taken advantage of it.)

Image recognition AI eCommerce software
Pintrest’s image recognition software can help shoppers easily identify products they like the look of online. [Source]

Voice recognition software

Voice-activated smart technology can recommend products and content from your eCommerce store. Many eCommerce sites are marking up their website with schema to optimize for voice search. Others are creating Alexa skills, developing their own voice assistant (like Alibaba’s Tmall Genie), or integrating with other smart home products. 

Final words

In eCommerce, sellers should constantly be looking for marginal gains. Whether you’re chipping away at your operating costs, or enhancing your conversion rates, it all contributes to a healthier looking bottom line.

Artificial intelligence software for eCommerce is a great way for you to do just that. It takes manual tasks off your plate and help you to convert more effectively. Make sure your online store is utilizing the best software out there to stay ahead of your rivals!

Did you know that over 60% of US online retail purchases were made through Amazon last year? Amazon’s hold over eCommerce is well established, with 9.1 million active Amazon sellers worldwide and an average of 66 thousand orders per day. Newer sellers may be wondering how they can get more sales on Amazon in such a competitive environment.

The truth is, they absolutely can because with Amazon’s booming market share come many opportunities. We’ve assembled this digestible list of 14 quick wins and strategic moves, to help you up your game and sell more on Amazon.

1. Do keyword research

Having the right keywords can be one of the most important tactics in reaching your target audiences. Using the keywords that are common to searches for your products is the objective, but search engine optimisation (SEO) is a constantly evolving game. That means that keywords used successfully in the past may not be as effective with updated search engine algorithms today.

The terms used by customers to find products change daily and are affected by seasonal, cultural, and economic factors. Hence, it’s important to stay on top of the latest SEO trends and make sure you cast a wide net when implementing keywords for each product listing.

Each product should be optimized with as many relevant keywords as possible – into the hundreds! This gives you the best possible chance of getting your products found by customers, helping you sell more on Amazon.

Amazon keyword research tools like Helium 10, SellerApp, Jungle Scout, and AMZ One can help by generating a list of related keywords with search volume, competition level, and other useful metrics, making it easier for you to choose the best keywords for your product listing

2. Use a repricing tool to get more sales on Amazon

When it comes to sealing the deal and making a sale, price is a main deciding factor for many customers. As an Amazon seller, you always want to make sure you’re pricing your products competitively, but equally, you don’t want to lose your margin! 

This is something that using repricing software can help with. Repricing software automates the pricing process in real-time, ensuring your prices stay in line with those of competitors, and with market fluctuations, while you get more sales on Amazon.

Repricing software also has many customisable features that allow you to set prices at optimal levels to help drive sales, without compromising profit. It’s worth taking a trial to see how it can help lift your sales. 

3. Get more Amazon reviews

Online reviews are important to spread confidence through word of month and for building credibility for your brand. It’s also a fact that 72% of shoppers won’t buy until they’ve read reviews of a product from people like themselves – people they trust. 

Even a strong product with great marketing behind it still has to overcome the fear of the unknown if there’s no social proof. Plus, positive reviews are a significant factor in deciding which products win the Amazon Buy Box.

Get more Amazon reviews by encouraging feedback from your customers. The best way to do this is by utilizing feedback software to automate the process.

4. Provide great customer service

Customer service is absolutely essential in eCommerce. Offering top-quality customer service not only adds value, but helps retain customers. A big part of making a sale is assuring the customer that they can trust you to deliver, and that trust is hard earned but easily lost. Providing good eCommerce customer service is critical, and committing to providing great customer service is all the more so!

As an Amazon seller, you need to be on top of your customer service. Responsiveness, a friendly manner and quick and easy resolution processes are all ingredients that make for a winning approach to great customer service. 

But it can be confusing trying to streamline it all. Thankfully, there are all sorts of tools available to make this job easier, like helpdesk software to keep all your customer interactions in one place. This helps you to respond quickly and accurately to customer inquiries when they come in, so that your customers always know you’ve got their back.

5. Leverage Amazon seller tools

The best part about being an Amazon seller is that you don’t have to go it alone. There are numerous tools available to help you maximize your business and get the most out of selling on Amazon, whether third-party or FBA. 

From repricing tools, to help desk software, to review software and even shipping assistance, many tools exist on the market today that specifically help Amazon sellers optimize their listings, prices, feedback, shipping, customer service and even their taxes. 

There are many different seller tools available, so it’s worth reading about options and making an informed decision about the right ones to choose for your business. With the right tools, you can grow your business more than you ever thought possible. 

6. Get more sales on Amazon with ads

Running ads is almost guaranteed to help you get more sales on Amazon, but it’s easy to just throw money at them and hope for the best. You can do better! Pay attention to your advertising cost of sales (ACOS) metric, the figure for how much ad spend you need in order to make a sale.

By advertising more efficiently, you lower your ACOS and ensure you get more bang for your buck. Over time, you’ll learn what works and you can employ a strategy with regards to how you run your ads. Taking an insight-driven approach to Amazon ads results in a more profitable Amazon business!

7. Optimise your product pages

The old saying goes that 80% of readers never make it past the headline of any piece of content. That means once you’ve written your product title, you’ve effectively spent 80 cents of your dollar.

When writing product titles, stick to the formula of:

  • Brand name
  • Product name
  • Features (size, colour, gender etc). 

This lets you include the right keywords in the right order to immediately tell shoppers that this is the product for them.

Moreover, making sure to visually design your product pages so that they’re clean, simple and easy to read will also help win over shoppers. No one wants to read through a cluttered page. The more straightforward (yet informative) and the cleaner you make your design, the more likely you’ll be to win over those elusive eyeballs!

8. Win the Amazon Buy Box

The quickest way to get more sales on Amazon is by ensuring that your products show up consistently in the Amazon Buy Box (the area in the top right of a product page, where shoppers can ‘Add to Cart’ or ‘Buy Now’). This is because over 82% of sales happen through this highly sought after space.

Although the exact formula to win the Buy Box is unknown, there are a few things that we know are essential. These are mainly metrics that prove the seller is providing a good customer experience. Customer reviews play a big role here. The more positive reviews a seller can amass, the likelihood of winning the Buy Box increases. 

In addition to reviews, something else that’s obviously very important to Amazon shoppers is price! By using repricing software, you can automatically set your prices at the optimal level to win the Buy Box and maximize profit, even if you’ve got an enormous inventory.

9. Amazon account health rating

The Amazon account health rating (AHR) is a new feature that helps you monitor your account health based on its adherence to Amazon seller policies. 

It considers both negative factors (such as the number of unresolved policy violations on your account) as well as positive factors (how your account positively impacts the customer experience through its selling activities). 

Each account will be given a rating, which is regularly reviewed as Amazon monitors the performance of its sellers. If your account is off-target, you will be notified so that you can improve your performance. Conversely, a good AHR rating will work in your favor, helping assure customers that they’re doing business with a compliant seller. 

10. Maintain your Amazon SLA

A big part of being a seller is cultivating trust with your customers. That means showing them that you operate in an above-board manner and that you’ll make good on your promise of fulfillment to them. One way of doing that is by making sure your Amazon store has a Service Level Agreement (SLA). This is a promise to your customers that they’ll receive their orders on time. When it comes to fulfillment, the SLA is based on the capacity to fulfill open orders and on-time shipping and delivery. 

SLAs help manage customer expectations by defining standards and outlining circumstances under which you as the seller won’t be liable for unfulfilled promises (e.g., natural disasters preventing shipping, etc). 

eDesk’s customer service solution is designed to alert you when your SLA is expiring, so your business is never caught without one. Having a current SLA helps you maintain transparency with customers, thereby building trust which helps ensure customer loyalty.  

11. Focus on products that already sell

Most ambitious business owners want to try new streams of revenue, but it’s important not to lose sight of the things that are making you money now. 

By doubling down on the products that already provide your Amazon store with a reliable revenue stream, you not only deliver to market demand but ensure that you have the financial runway required to take risks on innovative new products, if need be. 

Review your financial statements every quarter and look at the items that are performing best in your store. Think about how you can continue to market these with ads, SEO keywords and upgraded images to maximize their selling potential in your online store. 

12. Sync your inventory

Inventory can be a delicate balancing act. Hold too much inventory for too long and you need to pay over the odds to store it. But hold too little inventory and you lose out on vital sales, or even customers, due to an inability to fulfill. Amazon can also penalize you if your inventory performance isn’t up to standard.

Stock control is something every seller needs to understand and have the capability to manage for optimal results. Smart inventory management is an under-appreciated way to increase your Amazon sales and profit margin. Fortunately, there are tools that can help. Investing in the right tools and software can help sellers take the stress out of balancing supply and demand.

13. Expand into new Amazon marketplaces 

Amazon currently has 20 marketplaces around the world, which include the US, Canada, Mexico, UK, France, Germany, Italy, Spain, Japan, Singapore, Brazil, Australia and more. 

You can scale your brand by moving into some of these marketplaces. This can involve doing market research to find out which products are popular in each market and then uplevelling your shipping operations in order to be able to ship globally.  

But expanding into new markets also means you’ll need to take language into consideration and localize your listings so that they feature each marketplace’s local language and SEO keywords in the appropriate language. Multilingual customer service is also needed in order to be able to service customers across various marketplaces in their local language. 

Sounds complicated? It doesn’t have to be. eDesk’s help desk solution is designed to support customer service and workflow in multiple languages, so you can expand your business without investing in the overhead of hiring a global team. 

14. Spy on your competitors

Ok, maybe “spy” is a bit of an exaggeration, but profitable sellers are always on the lookout for what their competitors are doing. You want to make sure you’re offering the right inventory for your market at the right prices. Repricing software will monitor this for you, taking the guesswork out of pricing at the right levels. 

Using data gleaned from helpdesk reporting can also help you gather valuable insights and feedback from your customers, which will help you to better understand what customers want and need. Acting on analytics-driven insights from easy-to-read reports means you’re always one step ahead of the competition. 

Final thoughts

The quest to increase your store’s Amazon sales doesn’t need to be an uphill struggle. There are many resources available to Amazon sellers today to help them optimize their store and develop a healthy sales pipeline. 

By staying in touch with how the Amazon platform grows and using the right tech tools to drive your business, you can continue to do what you do best: building a great brand, winning customers, retaining existing customers and improving your bottom line. 

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