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Charlie Semmence

<p>As we look ahead to the ecommerce landscape of 2024, it's clear that artificial intelligence (AI) isn't merely a trend; it's the driving force behind an exciting new era of online retail. And as AI continues to reshape the way consumers shop, and <a href="https://www2.deloitte.com/us/en/pages/about-deloitte/articles/press-releases/deloitte-state-of-ai-fifth-edition-report.html" target="_blank">94% of business leaders</a> agree that it is crucial to success, retailers need to stay ahead of the curve.</p>
<p>Here, we'll delve deep into the transformative power of artificial intelligence in ecommerce, and unveil the cutting-edge AI trends set to redefine the online retail experience in 2024.</p>
<h2><strong>1. Personalised shopping experiences</strong></h2>
<p> </p>
<p>It’s well-known that greater personalisation makes for happier shoppers. In fact, <a href="https://cxtrends.zendesk.com/" target="_blank">70% of consumers</a> spend more with companies that offer more personalised customer experiences. AI helps brands achieve this more easily than ever. <br data-mce-fragment="1"><br data-mce-fragment="1">AI-driven personalisation is not new, but it's becoming increasingly sophisticated. In 2024, expect AI to take personalisation to new heights, as machine learning algorithms analyse vast amounts of customer data (including browsing behaviour, purchase history, and even social media activity) to create highly personalised shopping experiences. <br data-mce-fragment="1"><br data-mce-fragment="1">This will result in more effectively tailored product recommendations, customised marketing messages and dynamic pricing strategies that help consumers discover the products they're looking for while driving conversions and revenue for brands.</p>
<h2><strong>2. Visual search</strong></h2>
<p> </p>
<p>The importance of helping your customers find the products they’re looking for cannot be overstated, and in 2024, AI is going to change the game. <br data-mce-fragment="1"><br data-mce-fragment="1">AI-powered visual search engines will enable users to find products by simply uploading images or taking pictures with their smartphones. Using artificial intelligence and machine learning, visual search engines can analyse an image, recognising shapes, colours and details to suggest similar products. This technology caters to modern shoppers, who seek simplified visual shopping experiences.</p>
<h2><strong>3. Chatbots and virtual assistants</strong></h2>
<p> </p>
<p>In 2022, <a href="https://www.forbes.com/sites/forbestechcouncil/2023/04/21/how-e-commerce-brands-can-use-ai-to-deliver-a-more-personalized-shopping-experience/?sh=67af440a547c" target="_blank">Juniper Research</a> estimated that chatbots saved businesses 2.5 billion hours and £6.5 billion. In 2024, AI-driven chatbots and virtual assistants will continue to enhance customer support. <br data-mce-fragment="1"><br data-mce-fragment="1">These virtual helpers will handle routine enquiries, provide product recommendations and assist with the purchase process. With natural language processing (NLP) advancements, chatbots will become more conversational and capable of resolving complex customer issues, improving customer satisfaction and reducing support costs.</p>
<h2>4. Predictive analytics for inventory management</h2>
<p> </p>
<p>Efficient inventory management is critical in ecommerce, and in 2024, AI will play a pivotal role in optimising this process. Predictive analytics powered by AI will help retailers forecast demand more accurately, reduce overstocking and understocking, and improve supply chain efficiency. This will lead to cost savings for businesses and better shopping experiences for customers through more consistent product availability.<br data-mce-fragment="1"><br data-mce-fragment="1">According to <a href="https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/ensuring-high-service-levels-to-meet-high-consumer-demand-volatility" target="_blank">McKinsey &amp; Co</a>, businesses that invest in machine learning to manage demand forecasting can achieve 90% accuracy with a three-month lag, compared to just 60% with manual forecasting.</p>
<h2><strong>5. Voice commerce</strong></h2>
<p> </p>
<p>At the beginning of 2023, there were <a href="https://www.statista.com/statistics/973815/worldwide-digital-voice-assistant-in-use/" target="_blank">4.2 billion</a> voice assistants (like Siri and Alexa) in use across the globe. By 2024, this number is expected to reach 8.4 billion, as more and more consumers turn to the speed and convenience of voice search.</p>
<p>Online retailers need to invest in voice commerce capabilities to capture the growing audience of voice-enabled shoppers.<br data-mce-fragment="1"><br data-mce-fragment="1">AI-powered voice assistants will facilitate voice-activated shopping, allowing customers to make purchases, track orders and enquire about product details using their voices. This trend will require businesses to optimise their ecommerce platforms for voice search and integrate with voice assistant platforms.</p>
<h2><strong>6. Fraud detection and prevention</strong></h2>
<p> </p>
<p>Ecommerce businesses are always vulnerable to fraud, but AI can significantly bolster fraud detection and prevention efforts. How? Advanced machine learning algorithms can analyse transaction data in real-time to identify and block fraudulent activities. This not only protects businesses from financial losses but also builds trust among customers.<br data-mce-fragment="1"><br data-mce-fragment="1">A <a href="https://brighterion.com/industry-perspectives-on-ai-and-transaction-fraud-detection" target="_blank">2023 Brighterion survey</a> found that 49% of financial institutions have already integrated AI into their systems to support fraud detection, and 93% plan to invest in it within the next 2-5 years. AI will revolutionise this space.</p>
<h2><strong>7. Sustainable ecommerce</strong></h2>
<p> </p>
<p>Sustainability is an increasingly important concern for both consumers and businesses, with <a href="https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/consumers-care-about-sustainability-and-back-it-up-with-their-wallets" target="_blank">78% of consumers</a> saying that sustainability is important to them, and 84% of saying that poor environmental practices would alienate them from a brand or a company.<br data-mce-fragment="1"><br data-mce-fragment="1">AI will play a role in making ecommerce more sustainable by optimising logistics and reducing waste. Machine learning algorithms can find the most efficient delivery routes, reduce packaging waste through better sizing and help businesses make environmentally conscious decisions in their supply chains.</p>
<h2><strong>8. Ethical AI and data privacy</strong></h2>
<p> </p>
<p>With the increasing integration of AI in ecommerce, there's a heightened awareness of the ethical implications associated with its use. Trust in AI is increasing, however <a href="https://www.ipsos.com/sites/default/files/ct/news/documents/2023-07/Ipsos%20Global%20AI%202023%20Report%20-%20NZ%20Release%2019.07.2023.pdf" target="_blank">44% of people</a> don’t trust AI to not discriminate or show bias, and 50% don’t trust companies that use AI to protect their personal data. <br data-mce-fragment="1"><br data-mce-fragment="1">Ethical AI practices involve ensuring that AI systems are designed and deployed in ways that respect fundamental human rights, promote fairness and avoid discrimination. Businesses that prioritise these principles will not only comply with regulations but also build trust with their customer base.</p>
<h2><strong>2024 AI trends</strong></h2>
<p> </p>
<p>2024 promises to be an exciting year for ecommerce as AI technologies continue to reshape the industry. Embracing these trends will be essential for businesses looking to stay competitive and provide exceptional shopping experiences for their customers. <br data-mce-fragment="1"><br data-mce-fragment="1">Those harnessing the power of AI will unlock new opportunities for growth and innovation. Those that stall risk falling behind.</p>
<p>Keen to get started? At <a href="https://www.underwaterpistol.com/" target="_blank">Underwaterpistol</a>, we're experts in harnessing the power of AI to drive the growth of ecommerce businesses, and we’ll help you do the same. <a href="https://www.underwaterpistol.com/contact" target="_blank"><strong>Talk to us</strong></a> about our AI consultancy services.</p>

The future of ecommerce: 2024 AI trends that will redefine online retail