ROI Of AI: 5 Ways Retailers Are Embracing The Innovation

“Artificial Intelligence (AI)” is being touted as one of the newest, most promising business technologies of the 21st century — even though its roots go back nearly 80 years. The fact is, the basics of AI can be traced back to Alan Turing and the Theory of Computation in the late 1930s; and the 1950 paper that helped inspire the 2014 film, The Imitation Game: Computing Machinery And Intelligence.

But as AI has moved out of the theoretical realm and into the practical, confusion about what AI is — and what it can do — has grown. Even today’s smartest and wealthiest business executives seem a bit stumped by what, exactly, constitutes an AI solution. As recently as July 25, 2017, Mark Zuckerberg and Elon Musk got into a social media feud over each other’s understanding of the technology.

That said, today’s tech companies have grabbed onto the theories and are working to morph them into machine-driven solutions that improve human lives. With AI-powered solutions, businesses can help humans clean the floor with an AI-empowered Roomba, improve their fitness routines, and even receive more personalized product recommendations from retailers. Several of the largest tech companies, including Amazon and Google, have open-sourced AI software to help power product recommendations.


At Retail TouchPoints, we’ve reported on at least 50 AI-related stories in the last 10 months alone.

AI In Action: 5 Retail Case Studies

Most retailers are aware of AI to some degree; many retailers are trying to fit AI strategies into their future budgets; and a number of retailers already have started testing and implementing AI projects to improve mobile sales, social commerce, product promotion, personalized recommendations and sentiment analysis. Here are five recent examples all retailers can consider:

  1. L’Occitane achieved a 15% lift in mobile sales by using heat maps and artificial intelligence-powered technology from ContentSquare to analyze the checkout process and identify the “struggle points” in each market, said Anne Lesueur, the company’s International e-Commerce and Media Director, in an interview with Retail TouchPoints.
  2. David’s Bridal has been using AI to improve social commerce with a tool that uses artificial intelligence to create pop-up landing pages for brands to link to on social media. Partnering with Curalate, the retailer has seen 13 times more click-throughs across social platforms and a 40% decrease in bounce rate.
  3. Earth Fare is boosting year-over-year topline sales by optimizing product promotion with an AI solution from Daisy Intelligence. Earth Fare’s category managers use weekly promotional recommendations to improve sales growth and guide go-forward decision-making.
  4. Amazon is offering Prime members the ability to complete purchases using the AI-powered Amazon Echo. Shoppers can ask Alexa to recommend products. The tool analyzes the user’s order history to find relevant products before fulfilling the purchase command.
  5. Shop Direct is working with IBM’s Watson to develop AI that can perform sentiment analysis to detect a shopper’s mood, based on word usage and message tone. For example, “If they are getting frustrated Watson would recommend the customer speak to a person instead and will put them in touch with the relevant employee,” said Andy Wolfe, CIO of Shop Direct, in an interview with

The Future Of AI Is Now

Many prominent retail industry analysts have reported on AI in studies, videos and reports, including IDC’s Greg Girard, who spoke at the 2017 Retail Innovation Conference. Watch his video presentation here: Artificial Intelligence In Retail: It’s Time Now. Girard and IDC predict that worldwide spending on cognitive intelligence and AI will reach $12.5 billion in 2017, an increase of 59.3% over 2016.

Girard also shared: “By 2019, artificial intelligence will change how 25% of merchants, marketers, planners and operators work, improving productivity by 30% and KPIs by 10% to 20%. AI will help teams work better together.”

AI recently has become a hotbed of investments for startups, which pumped close to $5 billion into AI in 2016, focused on shopping apps, image recognition, predictive inventory tools, natural language processing and more. The investments have continued in 2017, according to

• A $19.5M Series D to in-store visual monitoring startup Trax Image Recognition from Investec;

• A $16M Series A funding to location-based marketing startup Databerriesfrom investors including Index Ventures and Mosaic Ventures; and

• A $15M Series B to natural language search startup Twiggle from Korea Investment Partners and Mizmaa Ventures.

Fulfillment also can be improved with the help of AI. CommonSense Robotics raised $6 million from Aleph VC and Innovation Endeavors to expand the use of AI in creating micro-fulfillment centers. The centers are designed to combine the benefits of local and automated fulfillment and maximize the use of retail space while enabling faster fulfillment and delivery of goods to consumers.

The future of AI is definitely now — now we just need Elon Musk and Mark Zuckerberg to agree on the definition.

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