How AI is Ushering in the Future of Interactive Commerce

Quiet luxury, coastal grandmother, and cottagecore are just a few fashion trends that have emerged from the TikTok era. If you’re like me, you wouldn’t even know where to begin finding an outfit to fit some of these. Is there a coastal grandfather option? Should I resign myself to the annals of the formerly presentable?

In truth, Gen Z’s are pushing the boundaries of more than just fashion, influencing digital commerce as we know it. Amidst shifting expectations, what’s become abundantly clear is that a context-specific and emotionally engaging approach to consumer engagement will win the day with all generations — from the zoomers to the boomers and beyond. And while it may sound contradictory, artificial intelligence can actually be the silver bullet to enabling more natural engagement.

More than half of consumers say they’ll become repeat shoppers after a personalized shopping experience. And there are three key dimensions of these experiences that are table stakes: interactions must be valuable, useful and enjoyable. Personalization sits at the center of these dimensions and can unlock better experiences at scale when combined with automation and human input.

Thankfully, I do have one thing in my corner: AI, integrated directly into the shopping experience.


Help me Pick Out an Outfit

Weddings have strayed from traditional dress codes; rather than “black tie optional,” it’s not uncommon to receive invitations with dress codes like “formal cocktail” – despite the two words seeming to be in natural conflict with each other. Conversational search tools unlock more effective discovery using real-time consumer input. Instead of toggling between the formal and the cocktail sections of a retailer’s website, a shopper can ask a direct, specific question and receive an outfit that replicates a personal shopping experience with results you just couldn’t get in a classic search. And it’s truly bespoke — the consumer receives not just a clothing item but also the right accessories to complete the look in line with your unique preferences.

Help me Find Something Similar

Though there’s been steady improvement following the pandemic-led rapid shift to digital, many ecommerce websites are not effectively connecting the in-store and online experiences. And for many, there’s nothing more frustrating than finding something in a store and not being able to track it down online. Embedding AI into the search experience solves this problem too. Tools that utilize image recognition can identify attributes from a photo and suggest relevant products based on visual similarity. In doing so, it effectively converts the image into data and serves the right recommendation, even without the product having all the right technical keyword tags on the back end.

Help me Make the Next Best Purchase

We’ve all had encounters online that make us want to shop exclusively in-person. I just bought a pair of jeans — why am I getting an email recommending I buy a similar pair mere minutes after I’ve checked out? Poor experiences like the one I just described are at best, annoying, and at worst, completely disengaging. Implementing AI into this piece of the journey can ameliorate these challenges, but it requires algorithms that go beyond the content and understand the context of past purchases to predict future intent. When the system truly understands a consumer’s affinity and has the context of collective behavior, it knows that it’s best to recommend a belt or another complementary item after you purchase a pair of jeans, and not another pair of jeans. Not only is the recommendation more relevant, it’s also helpful, providing value where other retailers may miss out.

There are unique problems that AI can solve when it’s properly incubated and activated; in line with robust data privacy principles and a guiding human hand, we can build technology that changes the way we shop for the better. While many organizations are stuck in engagement-focused personalization, the ones coming out on top have mastered activating against context, perception and expectation to deliver the connection consumers seek. And by focusing on connection, the metric of success is neither cost nor speed – it’s loyalty.

As we usher in this new era of interactive commerce, defined by nebulous trends and evolving algorithms, the more imperative it will be to be able to predict what consumers want, adapt to individual preferences and conquer the consumer experience battleground. With a holistic approach, retailers can put the consumer back where they belong: right at the center of the journey.

Ori Bauer, CEO of Dynamic Yield, a Mastercard company, has 20+ years of executive experience in both startups and large global corporations. Prior to joining Dynamic Yield, he was the Founder and CEO of Glean Health, an innovative, digital health data startup. Bauer’s deep business acumen is strengthened by an extensive technology background, and over the course of his career he has led product and engineering at three startups that were acquired. Today, as CEO, he is responsible for driving the next chapter of personalization growth.

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