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How to boost your e-commerce strategy with AI and digital transformation tools

Ignacio Pascual · Nov 17, 2020 4 minutes read

As the pandemic has further accelerated peoples’ tendencies to shop online, soon there will be 2 billion digital shoppers worldwide.  To keep up with the huge demand, e-commerce companies are shedding antiquated business practices and relying on artificial intelligence (AI) to stay ahead of the curve. 

Even before the coronavirus pandemic, the retail industry was seeing the greatest year-over-year increase of any sector when it comes to reliance on AI. According to a McKinsey survey from 2019, 60 percent of respondents in retail said their companies depend on at least one AI capability. Whether it be chatbots helping customers or algorithms that recommend products based on past searches, clients now expect to have reliable, non-human assistance when making purchases.

But AI is not just for the benefit of the customer.  That same McKinsey survey found that 63 percent of respondents reported sales increases in the departments where AI was implemented.  AI manages to consistently increase revenues while simultaneously lowering costs for the company.  

Here are a few AI and machine learning tools your business can use to get the most out of your   e-commerce strategy. 


Chatbots can interact with clients to facilitate and increase speed throughout the customer service process. Instead of unnecessarily speaking with another person by phone, chatbots provide quick answers to frequently asked questions, routine matters and circumstances and at times, specialized customer requests.   

They’re so commonly used for e-commerce now that two out of every three customers expect a messaging app assisting them when speaking to a business according to Chatbot Magazine. The benefits of having chatbots for your business include increased engagement, cost savings through lowered payroll expense and most importantly, speed for and to customers.  In addition, if your brand is international chatbots make you accessible 24/7 no matter where your customers are coming into your website page from.

This increased level of customer service is by far the biggest perk of chatbots. In a recent survey, customers noted the most positive takeaways from interacting with chatbots on a company’s webpage is how fast the chatbot responded, the fact they could get help outside of normal business hours and if the chatbot was successful at solving the issue at hand or at least, moving the process forward positively – quality of response. 

A/B Testing

Another crucial AI tool any retailer needs to improve their online offering is A/B testing. This allows your company to find out in real time what customers logging into your webpage respond well to and what they dislike. With A/B testing, on the fly you can adapt, upgrade and tweak your user experience (UX) design. 

A better UX design often results in immediate increases to clientele and sales. By using AI to pinpoint a specific section of your site where users are dropping off or getting frustrated, you can immediately make changes that will lead to higher engagement rates.

Collaborative Filtering and Machine Learning

Collaborative filtering is an AI method that takes past ratings of products from previous users to predict and then recommend similar products that other potential customers might like. You’ve likely seen Amazon point you towards sections of goods based on your past shopping searches. 

This ability for your site to recommend products based on past activity and purchases increases the likelihood you’re showing something that will interest the customer.  Another popular version of collaborative filtering is the user-to-user approach, which is commonly seen through star rankings or reviews of products online. 

This recommendation-based approach is believed to be behind at least 35 percent of Amazon’s revenue and has produced similar success on other e-commerce sites. 

On top of item suggestions, machine learning can also optimize and predict searches by studying patterns and past preferences.  Getting your search results closer to the keywords that your potential customers search for leaves them feeling more satisfied. 


The adaption of these key AI tools are crucial to making sure your retail website stays ahead of the game.  E-commerce is expected to be a $4.13 trillion industry by year end, customers are increasingly relying on recommendations or customer service capabilities made possible by AI.

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