The Rise of AI in eCommerce in 2023

In 2022, 78% of brands reported that they had either already integrated AI into their processes, or were planning to in the near future. Given that this was before ChatGPT became publicly available, and with Bard - Google's rival to ChatGPT - on the way, it's likely that this number is currently skyrocketing even more.

It's easy enough to hear the phrase AI and know the results, but not exactly what's happening in that process. AI is no longer something that exists exclusively in the realm of big-tech - its in our homes, and in our phones - so what exactly is it? ChatGPT helped us produce the following breakdown, in simple English:

"AI stands for "Artificial Intelligence." It allows machines to do things that would normally require human intelligence to accomplish. AI uses special algorithms to learn from data, recognize patterns, and make decisions on its own without being explicitly programmed to do so.

This means that machines with AI can "think" and "learn" like humans do. They can do things like recognise faces, translate languages, take exams and even play games like Chess. AI is becoming more and more common in our daily lives, from voice assistants like Siri and Alexa to self-driving cars."

AI is already playing a crucial role in streamlining processes for many eCommerce businesses, so we'll be exploring the impact AI can have on different areas of eCommerce, what the future looks like, and how we're using AI in a particularly unique way at Shiptheory.

How can AI help my business?

Given that AI is infiltrating all areas of our lives, it's inevitable that AI is already playing a crucial role in all areas of business.

You may be familiar with some ways AI is transforming eCommerce - after all, the eCommerce sector was the widest adopter of AI in 2022 - and you may be using it in some capacity already...but you may not have considered how far-reaching the application of AI is.

We've compiled examples of the role AI can play across the key departments in most online businesses, to give you some inspiration on how AI could transform your business - if it isn't already!

Customer Service:

Chatbots are part of the furniture when it comes to AI in eCommerce, with companies such as Intercom and Drift enabling businesses to improve their response times and alleviate burden on their support dreams.

The smarter chatbots become, the more equipped they are to resolve customer queries completely - and therefore the less support operatives have to intervene. Intercom customer Simply saw a 99% reduction in response times using a chatbot to manage their support queries, for example.

But Intercom is going even further than their existing bot performance, and have announced 'Fin', their new AI chatbot that will be powered by GPT-4.

Intercom states that they firmly believe that the future of support is 'a mix of bots and humans', with Fin able to digest the entirety of your support docs and resources.

If a question is raised that Fin isn't equipped to deal with, it knows when to pass responsibility on to a human support agent. Likewise, Fin knows when to stay out of conversations that aren't anything to do with it's tasks.

Fin will also be much more conversational than many existing support bots. If Intercom's vision for the future of support becomes a reality, it's likely that we'll see competitors produce alternatives to Fin, as conversational AI becomes more accessible.

Anyone who has ever worked in a customer support role has probably seen angry customers insisting on speaking to a real human - but with the trend towards AI picking up speed, intelligent AI could soon become the go-to for speedy and accurate support.

Content Marketing:

ChatGPT is already proving invaluable for marketing teams when producing content. There are different levels of reliance - some will use it purely for research (as I have in this article!) whereas others are producing months worth of content in hours, pairing them with AI-generated images for a full draft-to-published process.

ChatGPT is limited due to its inability to process web data beyond 2021, but as ChatGPT improves and Google's Bard edges closer to widespread public access, AI's role in content production is likely to grow a huge amount over the next few years.

Companies around the world have been incorporating AI into their content production for years. The Washington Post, for example, has been covering current affairs using their own AI technology called "Heliograf," which can generate news articles and alerts in real-time.

Using natural language processing and machine learning algorithms to analyse data from historical articles and press releases to efficiently produce informative content.

This had freed up Washington Post reporters to focus on more in-depth and investigative stories, creating a great balance between rapid news content and deeper, longer reads helping them reach a wider audience.

Shopify have recently announced their own tool to help retailers automatically generate product descriptions. Retailers will be able to add the crucial details of a product and choose the tone, and let the Shopify Magic AI automatically generate a convincing product description for them.

Only price is a more important factor than detailed product descriptions for customers looking for clothing and groceries, among other areas of online shopping. With that in mind, being able to auto-generate product descriptions is hugely useful, especially for retailers or businesses with a huge product catalogue.

Logistics and Deliveries:

Last mile delivery issues have long plagued eCommerce stores and threatened their brand perception. We've all had experiences where delivery drivers have taken an age to find our home, or receive a notification that your package has been successfully delivered, but there's no sign of it.

Some businesses, such as Bikes Online, found that due to limited tracking for their orders, they were frequently asking for product reviews before they were delivered.

This disconnect can be a huge issue for eCommerce brands - you're putting your reputation and customer relationships in the hands of third parties. A negative delivery experience could easily cause you to lose a customer, even its not directly your fault. Because of this, any role AI can play in making the delivery experience smoother is incredibly valuable.

Bikes Online used ParcelPerform's AI to predict delivery times with a hugely increased accuracy. This means that they can provide customers with relevant updates on their order's journey, but also send review requ
ests at the right time.

WISMO (where is my order) emails dropped by 20%, and engagement in update emails jumped by 80%. With customers happier and more engaged, as well as more timely requests for reviews, AI was a huge win for both retailer and customer in this scenario.

Other examples of how we can expect AI-powered software to transform logistics include optimising delivery routes, thereby reducing shipping times so customers can get their order quicker. Another more space-age example is AI-drone delivery. We'll likely see a rise in autonomous drone delivery, with AI-calculated routes making deliveries more efficient than ever, particularly in rural or hard to reach areas.

JD.com has been using AI delivery to reach addresses in rural China since 2016, and Tesco and even the NHS have trialled autonomous delivery here in the UK. It may only be a matter of time before AI is inseparable from eCommerce deliveries.

Personalised Marketing with AI

Even with conversational AI like ChatGPT, it could be argued that AI is removing a human touch from business; replacing customer service operatives, removing the personality from content...but this doesn't have to be the case.

AI also doesn't have to remain in the realm of computers either. Our latest product launch at Shiptheory combines AI with personalised marketing to forge a personal connection between businesses and their customers, to retain more customers and improve brand perception.

'Penmanship' enables customers to generate notes that look handwritten for all of their sales orders. Our AI adds variation to the notes, so that customers are totally convinced when they receive the order that the note was written by hand.

Handwritten notes are a great tool to build relationships with customers, but take lots of time and lots of effort...but Shiptheory allows you to automatically produce notes for your customers by inserting their details into your own pre-built templates. Once and order comes in, notes can be automatically printed and inserted in with orders.

Handwritten notes have a 99% open rate compared to 27% for marketing emails, so they're a really valuable way to communicate offers and review requests to customers. As is the purpose of AI across all departments and use cases, Penmanship helps people achieve things by minimising the time and effort spent on previously complex tasks.

Is AI going to replace us all?

Long story short...no it isn't! Despite the widespread application of AI, its more of a tool that eCommerce businesses need to acquaint themselves with and take advantage of, rather than as an adversary. As more and more businesses take advantage of the potential of AI, it's important to make sure your business isn't left behind.

You can learn more about Penmanship, Shiptheory's AI handwritten note solution, on the Shiptheory website. For other content around eCommerce and shipping, check out the Shiptheory blog!