Why it matters:
- The global market for AI tech is expected to grow by an average of 38% annually and reach $1.8 trillion by 2030.
- AI is being used by restaurants and retailers to fashion brands to analyze shopping behavior and recommend products, communicate with customers, keep store shelves stocked, and perform other tasks.
- Startups are poised to leverage AI in new ways to help shoppers find the perfect fit or help them haggle online over the price of a handbag.
Artificial intelligence tools that can compose poetry or draw a digital picture are in the spotlight now. But many consumers may not realize that artificial intelligence already is being used to predict their spending habits, answer their questions, or take their order at a drive-thru window.
Artificial intelligence – AI – is expected to quickly take on a larger importance in the everyday lives of consumers as retailers, restaurants, and brands large and small rush to invest in new AI-powered tools.
Use of AI across all industries is expected to accelerate with the recent announcement by Microsoft that it’s making OpenAI technology available to its Azure cloud computing customers.
OpenAI is the company that created the ChatGPT chatbot that can answer questions and generate a poem in the style of William Shakespeare or a comedy monologue in the style of Jerry Seinfeld, and Dall-E, which can draw pictures based on written suggestions.
Over 200 companies were using the AI capabilities within a week of Microsoft’s announcement, its CEO Satya Nadella told investors in January.
Microsoft has made a multiyear, multibillion-dollar investment in OpenAI to accelerate AI breakthroughs. “The age of AI is upon us,” Nadella said in the most recent Microsoft earnings call.
The global market for AI services, currently valued at $136.6 billion, is expected to grow at an average annual rate of 38% and reach $1.8 trillion by 2030, according to a report by Grandview Research.
Here are some of the ways AI is changing buying and selling:
Food service: Del Taco’s AI-enabled virtual assistant ‘shows up every day, doesn’t call in sick’
Drive-thru customers at some restaurants in the Del Taco fast-food chain are now ordering their tacos, fries, and shakes using a virtual assistant powered by AI to understand voice commands and respond verbally.
Del Taco announced in January that it was expanding its partnership with Presto Automation after a successful test of its Presto Voice system for drive-thru restaurants.
“The AI shows up every day. It doesn’t call in sick; it does what we tell it to do. It’s the model employee,” Del Taco Vice President of Operations Innovation Kevin Pope said in a Presto Automation video about the system.
Presto has also installed the systems at Checkers and Rally’s restaurant drive-thrus.
According to Presto Automation, substituting a human employee with a virtual assistant can save a restaurant chain $35,000 in annual labor cost per location, and drive $330,000 in additional upsell revenue per store, as the virtual assistants seem to be better at remembering to ask: “Would you like fries with that?”
Papa Gino’s Pizzeria, a New England restaurant chain, is partnering with voice AI company ConverseNow to test using a voice AI system to take phone orders from customers.
[Read: 5 Post-COVID Economy Tech Trends Driving Sales]
Grocery and mass merchants: Tapping AI to restock shelves and gauge shopper interest in a product
AI is being used in supermarkets and at mass merchants to keep shelves stocked properly, and to help stores keep track of inventory and product demand.
Sony Semiconductor Solutions, a subsidiary of Sony Group Corporation, in January debuted image-sensing AI technology that will help merchants instantly spot shelves that need to be restocked and also collect anonymized data on aisle traffic and customer engagement with products.
Tech giant Google, with its Google Cloud division, also announced an AI-powered shelf-checking tool. According to Google, its AI-vision tool leverages billions of images in Google’s database and is sophisticated enough to differentiate between various flavors of jam and jelly or brands of toothbrushes on a store shelf.
Grocers such as Wakefern Food, which operates the ShopRite and PriceRite stores, are testing AI tech that uses computer vision to enable checkout-free shopping linked to a mobile app.
The AI shows up every day. It doesn’t call in sick; it does what we tell it to do. It’s the model employee.
Kevin Pope, Vice President of Operations Innovation, Del Taco
Fashion: AI solutions that find the perfect fit while shopping online
In addition to using AI to recommend purchases and suggest complete outfits to online shoppers, the fashion industry is exploring AI solutions for finding the perfect fit while shopping online.
A number of startups are using AI tools to create virtual try-on avatars for consumers from selfies they take on their smart phones.
One of those companies, Bigthinx, has also created virtual runway shows for fashion brands.
[Read: 4 Trend-Driven Ways Brands Are Tapping Personalization for Growth]
Forecasting: Unearthing trends by indexing millions of comments and conversations across social media and news sources to online searches
Currently, the primary use of AI in retail is to analyze massive amounts of data in order to predict trends and monitor supply and demand.
Startup Quilt.ai has built an AI platform that gathers and indexes millions of comments, conversations, and data points across social media, news sources, and online searches to forecast trends and gain insight into consumer behavior.
Bargaining: Chatbots that ask customers what they’re willing to spend
London-based tech company Nibble Technology has used AI to train its chatbot to bargain with consumers who are seeking deals online.
The Nibble chatbot, CEO Rosie Bailey told CO—, enables online retailers to sell inventory they want to move, without offering across-the-board discounts that kill margins.
If an online shopper lingers for more than two minutes on a product the retailer is willing to discount, the Nibble chatbot pops up and asks if the customer would like a discount.
The chatbot asks the customer what they would be willing to spend, and banters back and forth using time-tested negotiation tactics.
The result, Bailey said, typically is that the item sells for more than it would have if the retailer had offered a fixed markdown.
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