In the retail industry’s quest to please ever-more-demanding shoppers and cater to their individual needs to buy whenever, wherever and however they want, artificial intelligence is shaping up to be perhaps the most critical piece of technology merchants need to add to their stack.
“If you don’t have an AI strategy, you are gonna die,” said Devin Wenig, president and CEO of online marketplace eBay Inc., at the recent Shoptalk conference in Las Vegas. “The largest job function we’ve been hiring has been data analytics and engineering to extract pattern from the noise. The promise of personalization in our industry has been a letdown.”
The ultimate goal, he said: To create a unique shopping experience for every single shopper.
Wenig admitted there’s been a lot of buzz and skepticism surrounding AI but said “that doesn’t make it wrong,” adding AI technology has seen a real “breakthrough” in recent years. “I’d rather be early than late,” he said.
Last year, eBay bought three AI-related companies, including its October purchase of image-search firm Corrigon. Using Corrigon’s technology, eBay has introduced “Shop the Look” feature on some parts of its site including eBay Collective. The technology allows shoppers to hover over an image, say a chair in the picture of a living room, and the tool searches eBay listings to surface inventory that matches or is a close match to that chair.
Also using AI technology, eBay has been working on a personalized shopping assistant bot for Facebook Messenger.“Instead of humans having to adapt their interaction, computers will adapt to humans in a way that’s natural for us.”
“The future is AI first,” said Jonathan Alferness, Google’s VP of product management, shopping and travel, at a separate Shoptalk presentation. “Instead of humans having to adapt their interaction, computers will adapt to humans in a way that’s natural for us.”
Google has been investing heavily the past 18 months in areas including machine learning, speech recognition and natural language processing, he said.
eBay and Google aren’t alone. No. 1 U.S. retailer Walmart said Monday it’s launching a tech incubator to invest in emerging technologies including machine learning and artificial intelligence.
Target’s first-ever startup accelerator program last year also included machine learning related startups.
The retail sector isn’t the only one hot on artificial intelligence. Healthcare, banking, auto and education are among other sectors talking about using machine learning to detect, for instance, fraud pattern in the financial sector.
In a November survey conducted for Infosys of 1,600 global IT and senior business decision makers from 10 sectors in US and six other countries, more than three quarters of respondents said AI is “fundamental to the success of their organization’s strategy.” More than three-fifths of the respondents in the study, released in January, said they believe their organization’s future growth is dependent on “large-scale AI adoption.”
The study also showed 84% of the respondents said they plan to train employees about the benefits and use of AI. By 2020, companies expect to see AI contributing a 39% average increase in revenue, the study said.
By 2035, AI is expected to boost businesses’ labor productivity by up to 40%, an Accenture study released in September showed.