Whether it is for improving the customer’s online retail experience or fighting online fraud, Ecommerce retailers are growing to be more reliant on the current technologies to meet their present challenges. Since its inception in the 1970s, Artificial intelligence (or AI) and machine learning have been increasingly shaping the way humans interact with computer systems.

Cut to the year 2018 and we find AI playing a critical role in Ecommerce retail in different avenues including providing a personalized online experience and support for online shoppers. A Gartner report predicts that around 85% of all online customer interactions will be managed by AI by the year 2020. According to a research report published by HubSpot, over 70% of online users are using AI-based chatbots to resolve their queries and issues, while 38% of surveyed users are positive about their chatbot experience (according to a LivePerson survey).

This article discusses how AI technology is transforming various areas of Ecommerce retail.

Customer service using chatbots

AI-based personal assistants or chatbots are being increasingly deployed by Ecommerce retailers to create a personal touch with online shoppers. Apart from answering common queries, chatbots offer a cost-effective mode of providing customer service, saving around $1.3 trillion (or 265 billion customer calls) each year for the Ecommerce industry. Advanced chatbots such as ShopBot from eBay can even help you find a gift within your budget or locate a product (based on an uploaded image).

Improved search results

Disappointed with the product lists that showed up for your Ecommerce retail search? As with any other online shopper, you are not alone. AI-based tools (such as Twiggle) is using natural language processing (or NLP) to improve search results for online shoppers. Technology start-up, Clarifai is improving the visual aspects of search by including image and video recognition. Using AI, shoppers can easily find similar (or same) items as an uploaded product image.

Fake review management

According to a survey conducted by Dimensional Research, around 90% of online buying decisions are influenced by both positive and negative online reviews posted by other users. The Ecommerce industry is also trying to cope with the increasing number of fake reviews posted by bots and competitors. Online retail giant, Amazon, is using AI technology to combat fake reviews by focusing on genuine and verified reviews posted by its customers.

Personalized customer experience

Based on individual customer-related information such as product preferences, purchase or browsing history, and even external third-party data of the individual, Ecommerce retailers are using AI to create a more personalized experience for each customer. AI engines such as Boomtrain can monitor multiple touch points and devices (including mobile apps, e-mail campaigns, and websites) used by an individual to analyse how they are interacting online and to deliver a consistent online experience across multiple platforms.

AI-based engines (such as Starbucks’ “My Starbucks Barista”) are being deployed to predict customer behaviour and provide more personalized product recommendations.

Improved Sales process

A study (conducted by Conversica) revealed that around 50% of sales and marketing budgets are wasted on sales leads, who are never contacted or followed up by the sales teams. AI-based systems with NLP and voice-enabled search capabilities (such as Amazon Alexa and Apple Siri) are being used to address customer queries and identify selling opportunities for online retailers. As an example, eCommerce retailer, North Face, is using IBM’s AI solution, Watson to transform the in-store and online shopping experience for its customers.


AI technologies are increasingly becoming crucial for the success of Ecommerce players. By analysing millions of online interactions, AI is making it possible for Ecommerce retailers to provide a personalized shopping experience for each of their customers. By touching key business touchpoints such as customer retention, sales and marketing, and customer service, artificial intelligence is transforming the way we buy or sell products online.