New Technologies to Impact E-commerce Business – Part 1 (AI/ML)

Contributed by: Anonymous
July 09, 2021

E-commerce has always been a game changer in the global business environment. It has disrupted the traditional brick & mortar industry and forced physical retailers and companies to re-think the way they have been doing business. The E-commerce companies continued to reinvent the game and with new technological developments they have been constantly evolving, with additions like – mobile apps, e-wallets etc. However, the pace is not slowing, instead more and more new technologies are emerging every day. Overall – we can classify these new advancements into two major categories – AI/ML driven changes and other Technology trends in E-commerce.


It goes without saying that AI and ML are not same. AI refers to a computer’s ability to imitate human logic, and make decisions like a person would. Machine learning is a subset of artificial intelligence. Machine learning technology uses data to make predictions or perform actions. The more data the tech gets exposed to, the more accurate its outputs. In essence, AI uses ML to take a set of data and figure out how to work with it. There are huge data sources in E-commerce business which can be used for AI/ML like – Purchase / search history, Reviews, Customer support & service data, Operations & Logistics, social media, Site Usage analytics, Natural language etc.



Smarter recommendations lead to more sales, especially for larger retailers with millions, perhaps hundreds of millions of items. In fact, AI-enabled personalized product recommendations for online shoppers are increasing conversion rates by 91.5%. Customers these days want intelligent product recommendations and AI/ML are enabling the same.


Search is probably one of the most important areas where advanced technologies are having maximum impact in the E-commerce world. AI is enabling different search options like – Visual Search, Image & Video Search, Voice Search for users. These options are revolutionizing the way B2C and B2B companies are doing E-commerce business.


Customer Service and support are an integral part of any business & always a challenge to excel. Artificial intelligence developers have a brilliant solution for this: automated sales reps. They come in the form of chatbots, virtual assistants, and even voice-command assistants.


Using AI/ML, businesses now can change the price of the product based on supply and demand in real time using dynamic pricing strategy. It leverages customer data, competitive pricing data, and sales transaction data to predict when to discount, what to discount, and dynamically calculate the minimum amount of discount needed to ensure a transaction.


Predictive behavior modeling can be used to make predictions on a plethora of sales related things:

  • Predicting if a user will make a purchase in a specific product category in real time.
  • Predicting if a user will return and what purchases they will make at certain times.
  • Prediction of customer lifetime value.
  • Foreseeing customer churn.
  • Demand forecasting for specific product categories.


Efficient Inventory Management, Warehouse Management and Optimizing logistics also are deeply impacted by AI/ML. Supply Chain Management, reducing delivery time, on-time delivery, location identification- are some of the key pieces where companies are actively using advanced tech.


Filtering fake reviews or boosting sales through positive reviews – in both cases AI/ML can play critical role.


Fraud detection and fraud protection, then, are essential processes for all online stores. Machine learning technology can beef up these processes and make them more efficient.


Ecommerce businesses are increasingly leveraging hyperlocal ecommerce as it allows them to create multiple sub-stores based on customer geo-location, catering to the unique needs of targeted customers.


Headless commerce provisions the decoupling of the presentation layer or front end of a website from its functionality or back end. This facilitates developers to utilize front end technology of their choice to deliver a good content experience and plug in an ecommerce solution on the back end to manage the functionality.


Properly personalized content on the website or mobile application increases conversion and customer engagement. The selection of the best content is possible thanks to machine learning algorithms for e-commerce.

12. AR & VR

By integrating immersive technologies like AR and VR into existing ecommerce stores, brands are making shopping experiences more friendly, intuitive and satisfying. These technologies are changing the way business’ function and revolutionizing the ecommerce industry.

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