Artificial Intelligence: A billion chance that retailers miss.

Artificial intelligence is increasingly used by retailers, but many options are still ignored by retailers, according to a recent study by Capgemini. This will save them up to 340 billion dollars (300 billion euros), notes the consulting firm in the study “Building the Retail Superstar”. FashionUnited has summarized the five key findings.

First of all, Artificial Intelligence is the pooling of possibilities and behaviors through learning systems that people perceive as intelligence, according to Capgemini’s definition. Simply translated, it is the intelligence of machines, software and devices to solve problems on their own. In doing so, they imitate the minds of people.

Capgemini has involved 400 retailers from several countries, including Germany, in the investigation. More than a quarter (28 percent) of participants say that they use AI 2018. Two years ago, it was only a minority of four percent.

1. Fashion retailers use artificial intelligence the most.

Which retailer is most concerned with artificial intelligence? The retailers in the apparel and footwear industry, as the report shows. One in three respondents said they use the technology to improve operations and personalize their relationship with their customers. For example, think of chatbots that answer questions from consumers or monitor inventory in department stores. The use of AI at online merchants is much higher than in physical stores, but according to Capgemini, this is not surprising since pure online retailers are by definition more data driven than omni-channel and brick-and-mortar stores.

2. AI does not cost jobs, it creates them.

The advance of robots is feared by many industries. The horror image that orders are picked up by robots is still anchored in people’s minds. However, according to the Capgemini study, 71 percent of respondents were able to create additional jobs through artificial intelligence. Two-thirds of these jobs are even executive-level. In addition, 75 percent of participants say that artificial intelligence has not yet saved jobs in their company. That robots really make people redundant does not seem to be a problem yet.

3. Artificial intelligence can save retailers 300 billion euros.

Research shows that artificial intelligence is mainly used for dealing with consumers. Think of the “maybe you like that too” article on a website or chatbot that can answer questions from customers. For example, Zalando also uses the feature that allows consumers to insert a photo or image and display items that are similar to the image. For example, Decathlon used artificial intelligence in the customer’s search process and found that the time from search to purchase was reduced by 48 percent, according to Capgemini.

The opportunities lie in the rest of the value chain, here are only a few examples of influences of artificial intelligence to see. Only one percent of respondents said that AI is used throughout the chain. According to Capgemini here is the possibility to reduce costs by 300 billion euros. For example, think of Zalando, who designed a collection of artificial intelligence in 2016, but there are not just design opportunities. In the field of warehousing, costs of $ 16 billion (€ 14 billion) could be saved, $ 144 billion (€ 126.1 billion) in the production chain, and $ 41 billion (€ 35 billion) in production Logistics, $ 123.6 billion (€ 107 billion) in returns and $ 14.7 billion (13, 1 billion euros) through theft prevention. For example, optimizing the suggestions to consumers based on data also reduces the chance that an item will be returned, which can save a lot of money. By “monitoring” all the items in a store with the help of technological elements, theft can be prevented. These are just some of the examples from the study.

4. Artificial intelligence in the shop.

The use of artificial intelligence in all parts of the value chain will not happen within one day. Based on the research results, Capgemini therefore recommends some elements to focus on. In stores, this is a self-scan checkout, while many retailers are still skeptical of a consumer who scans and pays for his own items. After all, a customer can choose not to pay and make an article of it, right? Artificial intelligence can “watch” an article by tracking an article as it is removed from a shelf or shelf and out of the store. This requires a shopper robots scanning the shop and shelves, the second point, which Capgemini recommends for physical transactions. These robots, for example, already used in the American chain Lowe, also register when an item is no longer in stores and must be delivered again.

5. The AI ​​can solve big problems, but do not forget the little ones.

The survey shows that 89 percent of participants use artificial intelligence to solve large and complex problems in the enterprise. The less complex problems are ignored by most. Only eleven percent of surveyed retailers say they also use AI for these issues. These small areas are often easier to implement and solve. Although the revenues from this are lower than those of the large complex problems, the consumer benefits from it. This is also an exhortation from Capgemini: Many companies rely on the cost, the return on investment and the data availability when implementing artificial intelligence. However, previous research by CapGemini showed that a positive experience with AI encourages 53% of consumers

amardeep kaushal

Blogger, Marketer & Data Analyst.

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