Artificial intelligence: "Top 5 Ways Amazon Uses AI to Improve Customer Experience and Drive Sales."
Amazon is one of the most innovative and customer-oriented companies in the world. Much of its success can be attributed to its use of artificial intelligence (AI). Amazon has used AI to improve the shopping experience for its customers and drive sales, from personalised product recommendations to voice-enabled virtual assistants.
In this article, we'll explore how Amazon is using AI to improve the customer experience and present some real-world examples of how these technologies are used.
1. Personalized Product Suggestions
Amazon's personalised product recommendations are one of the most well-known applications of AI. When you visit Amazon's website, you'll notice a section called "Recommended for You" that displays products based on your browsing and purchasing history.
To make personalised recommendations, Amazon's AI algorithms examine your previous purchases, search history, and even products you added to your cart but did not purchase. This personalised approach help ensures that customers are shown products they are more likely to be interested in, increasing the likelihood of a purchase.
Real-world use case!
In 2013, Amazon reported that personalised product recommendations accounted for 35% of its sales. Amazon can improve the customer experience while also driving sales by using AI to make these recommendations.
2. Virtual Assistant with Voice Recognition
Alexa, Amazon's voice-enabled virtual assistant, is another way AI is used to improve customer experience. Alexa is an artificial intelligence-powered assistant that can answer questions, play music, control smart home devices, and even make purchases on the user's behalf.
Alexa understands natural language and responds to voice commands, making it a hands-free and convenient way to shop on Amazon. Customers can use Alexa to add items to their cart, track their packages, and even reorder products they've previously purchased, all without using a computer or mobile device.
Real-world use case!
In 2017, Amazon reported that customers who used Alexa to shop spent 60% more than those who did not use Alexa. Amazon can drive sales and improve the customer experience by making shopping more convenient and accessible through voice commands.
3. Recognition of Images
Image recognition is another AI technology that Amazon uses to improve its customer experience. Users of Amazon's mobile app can photograph a product and use that image to search for similar products on Amazon's website. This technology can identify the product in an image and return search results that are relevant to the user's query.
This technology makes it easier for customers to find products of interest and also eliminates the need for users to type long search queries. Image recognition technology can analyse an image and return relevant search results quickly and accurately, improving the customer's overall shopping experience.
Real-world use case!
Amazon introduced StyleSnap in 2018, a new feature in its mobile app that allows users to take a photo of a clothing item and find similar styles on Amazon. This feature analyses the photo using image recognition technology and returns search results that are similar in style and colour.
4. Detection of Fraud
Amazon is also using AI to improve the customer experience through fraud detection. To detect fraudulent behaviour, Amazon's AI algorithms critically look at purchasing patterns, payment information, and account activity. When a potentially fraudulent transaction is detected, Amazon can act quickly to prevent the transaction and protect the customer's account.
This technology reduces the customer's risk of fraud and improves their overall shopping experience by instilling confidence in the Amazon platform.
Real-world use case!
Amazon reported that in 2018, AI-powered fraud detection technology helped prevent $300 million in fraud on its platform. Amazon can improve the customer experience and protect its customers from potential financial losses by using AI to prevent fraud.
5. Pricing Variability
Amazon is also using AI to drive sales through dynamic pricing. To adjust prices in real-time, Amazon's AI algorithms analyse pricing data, sales history, and market trends. This enables Amazon to offer competitive prices and respond quickly to market changes.
Amazon also uses dynamic pricing to optimise prices for individual customers based on their browsing and purchasing history. Customers are shown prices that are more likely to result in a purchase when pricing is personalised.
Real-world use case!
In 2019, amazon reported that it used dynamic pricing to increase its sales revenue by 35%. Amazon can drive sales and remain competitive in the online marketplace by using AI to optimise pricing.
Conclusion
Amazon's use of AI has transformed the online shopping experience, making it more personalised, convenient, and accessible to customers. Amazon has used AI technologies such as personalised product recommendations, voice-enabled virtual assistants, and image recognition to improve the customer experience while driving sales.