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Bring on the Bots: Here’s How Artificial Intelligence Will Shape the Future of Shopping

The Bot Shop on Kik's app.
The Bot Shop on Kik’s app.

Pretty soon, computers will hardly be able to be considered computers—they are already thinking, adapting and interacting with consumers at retail.

Regular old retail is dead and companies are on a desperate mission to revive it. And that’s where the bots come in.

Where retail was once a one-way conversation from the brand to the customers it was sure would buy its product, artificial intelligence (AI) chatbots are facilitating what has become a very necessary two-way conversation.

“This is the new game—getting feedback in the moment,” Andy Narayanan, vice president of intelligence commerce at Sentient, said at a Decoded Fashion NYC talk last week.

What bots are enabling, he said, is a more personal way for brands to engage with the consumers who buy from them. It’s a paradigm shift, really. It’s a shift from a push-based retail approach to a pull-based one.

“Customers are willing to pull what they want,” Narayanan said. “And today there is a big lag time between when the consumer gives feedback and when they see results.”

How do chatbots work anyway?

Teen centric chat app Kik partnered with Sephora to launch its chatbot earlier this year, and users who instigate a chat with the bot can take a short quiz to help teach the bot what it likes, and then get appropriate makeup tips and reviews based on their preferences. When product suggestions pop up, shoppers can buy them right in the app because Sephora’s site shows up on top of the app.

And the bots can even chat with other bots. Last month, Kik launched the function, which allows a user to talk to a Sephora bot about brow gel, say, and that bot can bring in a beauty bot to show videos on how to use the brow gel.

The best part about bots, Jaclyn Ling, director of retail at Kik said, is being able to reengage with the consumer afterward.

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Messages can be generated post bot chat to remind the consumer about products they looked at or suggest other complimentary things to buy, and according to Ling, the open rates on those types of notes have been much higher than with traditional avenues, like email marketing.

As Tony Valado, vice president of digital marketing for 1-800-flowers, explained, “We look at conversation commerce as kind of the next wave of commerce.” It’s one-to-one marketing at scale, he said. “We’re talking about bots here, but this is much larger than bots. Think about chatbots as the evolution to voice.”

The more a user interacts with the chatbot, the smarter it gets, essentially getting to know the user and what that user likes or might be likely to like.

“From an AI perspective, it gives us so much more insight than we’ve had before,” Valado said, explaining that with chatbots, retailers can have an almost immediate grasp on which products consumers are going to buy and uncover certain trends. “It will help us be better merchandisers, better buyers.”

Will chatbots replace retail apps?

Chatbots are perhaps best thought of as a user interaction platform, said Greg Cohn, CEO and co-founder of Burner, an app that gives users create as many phone numbers as they want, using them as private phone lines. Chatbots are an opportunity for brands to give consumers the personalized experience they know they seek, without adding scores of manpower and depleting efficiency to do it.

But it doesn’t mean they’re going to best retail apps and other tech innovations reshaping retail. It’s the same way Facebook didn’t replace the web, Cohn said.

As Narayanan put it, chatbots don’t solely bring out the best of a brand.

“It’s a tragedy if we let apps die. Brands have not realized the full potential of apps,” he said. “I think we just missed the opportunity by replicating the experience across platforms and just dumped it into the app.”

From a developer standpoint, Ling said bots are an untapped market.

“Bots provide a different use case for users as well as developers,” Ling said. “It doesn’t take memory or space to just use it on your chat app.”

The key will be—for both users and developers—to figure out how brands and retailers can use chatbots to help with challenges with the digital experience.

“Mobile is the future. Everything is going to be presented in a 5 to 5.5-inch screen,” Narayanan said. “Now brands have to find a way to actually acquire, engage and retain using that 5.5-inch screen. With that kind of a model, the flat experiences we have today are not going to scale.”

AI is here, but there’s still a way to go

If chatbots were human, they’d still be in the toddler stage, learning how to be in the world, but they’re likely to outpace people when it comes to growing up.

That is, if brands can build and use them right.

“It’s important to remember that what you’re building is an experience,” Cohn said. Bots can’t just be a smooth-talking concierge or a pushy perfume selling lady, he explained, the interactions between bot and consumer have to improve the shopping experience.

Brands and retailers can use AI to figure out what their customer wants, map it against their product catalog and use that to show shoppers the products they want.

The capabilities of AI, Narayanan said, are going to be fundamentally different from voice, it’s going to react much faster—and what’s more, it’s going to ease the consumer experience.

“Let the AI remove that friction between product and shopper,” Narayanan said.

At Sentient, the goal has been just that. The company’s e-commerce products integrate with retailers’ existing platforms, using AI-powered shopping to help improve consumer engagement and increase revenue and conversion.

What’s ahead for AI?

As brands and retailers turn their attention to the younger generation, the Gen Zers who aren’t at all thrown off by chatting to a bot, more may want to consider bots as part of their social strategies.

“There’s a huge opportunity to use chatbots in social interaction,” Ling said. “Being able to bring bots into friend conversations is something we see working really well.”

With an H&M chatbot, Ling explained, two friends on Kik can bring the bot into their existing chat and shop the retailer together.

AI may not yet be perfect or anywhere near as it still can’t always do what consumers may want it to, and the feeling that it’s still not quite a human remains very present, but it’s getting better.

“AI, in theory, is going to provide the right product for the right person at that moment,” Valado said. “Overtime as an industry and as brands we get better and better…it will get to a point where consumers won’t know the difference.”