How AI Could Revolutionize Personalization in e-Commerce

February 6, 2024 11:50:00

According to a 2021 study by McKinsey & Company, 71% of customers expect companies to deliver personalized experiences while 78% choose to pay higher prices for personalized services or custom services. The study revealed that companies with great personalization earn roughly 40% more revenue from personalization-related activities compared to companies with average personalization.

The research also found that 75% of customers recently tried a new shopping behavior, indicating that it is getting increasingly hard for brands to gain and retain customer loyalty. Personalization has become very important to customers who, on average, expect some degree of personalization in their interactions with businesses and become frustrated when there is little personalization.

With artificial intelligence (AI) and machine learning making significant advancements in recent years, many businesses are using the technology to boost their e-commerce personalization. The key to e-commerce personalization is understanding customers and offering them experiences that are tailored to their needs. This ensures they have enjoyable experiences every time they visit an online store, which increases their chances of becoming repeat customers.

AI has helped businesses capture real-time customer and product data in a way previous tools never could, allowing these companies to create incredibly tailored and immersive experiences for their customers.

While personalization in e-commerce has been around for several years, available tools limited the company’s ability to improve its personalization and carry it across different channels. However, generative AI can analyze massive amounts of data and identify previously undiscovered insights about individual customer behaviors, purchase patterns and preferences. With this newfound information, companies can offer curated product selections, targeted advertisements and personalized recommendations that are in line with their customers’ interests and needs.

AI-powered personalization has the potential to boost e-commerce by helping companies create experiences that resonate with potential customers on a more intimate level. To be fully effective, however, this technology requires significant amounts of product and customer data to keep the AI engines running. Every bit of information from clicks and page views to purchases and abandoned carts helps AI tools learn valuable insights into customer purchasing patterns, preferences and behaviors.

Companies should ensure they provide detailed product data to help the AI-powered personalization tools understand how product attributes are related to customer preferences and provide more personalized product recommendations.

AI can also use product and customer data to create unique content, such as tailored marketing messages or new personalized product descriptions to drive customer engagement even further and increase conversion rates.

e-Commerce platforms that focus on the healthcare segment, such as NextPlat Corp. (NASDAQ: NXPL) (NASDAQ: NXPLW), have to be more specific in their personalization efforts because each patient is unique and requires highly targeted product recommendations, marketing content and other communication.

NOTE TO INVESTORS: The latest news and updates relating to NextPlat Corp. (NASDAQ: NXPL) are available in the company’s newsroom at https://ibn.fm/NXPL

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