eCommerce

Jan 28, 2025

Top 21 AI use cases in eCommerce (the rise of AI in eCommerce)

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Instant Team

Top 21 AI use cases in eCommerce (the rise of AI in eCommerce)

Imagine you're trying to buy a pair of shoes online. You scroll, click, and scroll some more, but nothing catches your eye. Now, picture this: you visit an online store, and it instantly showcases a selection of shoes that fit your style, size, and even your favorite colors. This is the magic of AI eCommerce Personalization at work. The rise of AI in eCommerce is transforming how we shop, creating intuitive and personal experiences. In this article, we'll explore how AI is reshaping online shopping, from AI eCommerce personalization to intelligent search functions.

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Top 21 AI use cases in eCommerce

use cases of AI - AI Use Cases in eCommerce

Many eCommerce businesses are already using forms of AI to understand their customers better, generate new leads, and provide an enhanced customer experience.

1. Smarter searches

In addition to personalized product recommendations, AI enables retailers to understand the intent behind a shopper’s search query. When the average eCommerce bounce rate is between 20-45%, more intelligent searches are shown to reduce this number by offering more relevant results.

So how does AI search for eCommerce enable personalized searches that know precisely what a customer wants?

AI identifies online and offline data patterns like personalized product recommendations to understand customer intent. Machine learning algorithms take the analysis further to make the data contextual. For example, if a shopper searched for “hats,” and the AI was able to determine they have an upcoming wedding, it might return results for fascinators rather than woolen winter hats. AI helps customers save time by making more intelligent searches on your website. Because AI technology constantly “studies” the user, it learns about individual preferences and can make more accurate recommendations. For a search like “best holiday clothes,” the results would show clothing from the shopper’s favorite brand(s) that has just been booked and is appropriate for a city break. This hyper-targeting can tackle every retailer’s nightmare, abandoned carts. Globally, the average shopping cart abandonment rate is 70.21%. Through more intelligent searches, which understand the shopper’s intent, retailers can show the right product in the right place and time.

2. Retarget potential customers

According to Conversica, at least 33% of marketing leads are not followed up by the sales team. This means pre-qualified potential buyers interested in your product or service fall through the inevitable cracks. Many businesses are overloaded with unmanageable customer data that they do little or nothing with. This incredible goldmine of intelligence could be used to enhance the sales cycle. Looking deeper into the retail industry, facial recognition is already used to capture shoplifters by scanning their faces on CCTV cameras.

How can AI be used to enhance a customer’s shopping experience?

Some businesses now use facial recognition to capture customer dwell times in the physical store. This means that if a customer spends a notable amount of time next to a specific product e.g. an iPod, this information will be stored for use upon their next visit. The face of sales is changing, with businesses responding directly to the customer. It is as if businesses are reading customers' minds thanks to the data used with AI.

3. Personalized product recommendations

You can use AI to offer personalized product recommendations to your customers. Customized product recommendations often appear on a webpage after a customer does a product search. These recommendations may also be used in follow-up emails when customers abandon shopping carts. To determine recommended products, you must gather information on customer interactions, browsing and purchase history, location, and other factors. This is where AI shines. It can collect information on customers’ online shopping journeys and analyze buyer behavior to pinpoint products they’re likely to buy. Personalizing product recommendations can provide consumers with a more relevant online shopping experience that may turn them into repeat customers and loyal ambassadors of your brand.

4. Customer service chatbots

Through AI and other technology like natural language processing (NLP), chatbots are handy tools designed to simulate conversations with people online. Podium offers a chatbot through its Webchat feature. You can see Webchat in action on your site and set it up to answer common customer queries or perform simple tasks, making it a valuable tool in customer support. By integrating virtual assistants like AI chatbots into your online store, you can guarantee immediate response to customers. You can also make your website a conversation starter, get more customers, and boost your website’s conversion rates.

5. Visual search

Consumers abandon an eCommerce site because they can’t find their desired products. Artificial intelligence can solve this issue, and many businesses have already leveraged the technology to offer solutions with innovative visual search capacities. With this capability, your potential customers are more likely to discover products that match their needs and complete the checkout process.

6. Dynamic pricing

To determine the right price for your product, you need to research your competitor’s prices, client demand, and manufacturing costs. You can use artificial intelligence to monitor your competitor’s pricing and gather relevant data on market demand and other supply chain factors. With AI, you can quickly pick and adjust the right product price.

7. Fraud detection

One of the risks online retailers face is fraud. Online retailers deal with hundreds of attacks on their online stores every month. And the increasing popularity of online shopping just gives unscrupulous consumers and cybercriminals more opportunities to scam online businesses. You can use artificial intelligence to avoid becoming a victim of such scams. AI can assist in fraud detection by analyzing data, monitoring transactions, and detecting anomalies, like multiple transactions, within a short time frame. You can also utilize machine learning models to identify fraudulent behavior.

8. Demand forecasting

If you want to predict demand but don’t have enough historical sales data to use, AI can help. Many brands have used artificial intelligence in eCommerce to make demand forecasts. Instead of using historical data alone, AI uses real-time consumer data, including demographics, social media, and online reviews, to make sales and demand predictions more accurate and reliable.

9. Voice commerce

Using voice search, like Alexa, is more convenient and faster, so many consumers prefer this over the traditional way of interacting with devices. Many consumers already use voice search, so you should consider capitalizing on this trend. One way is to ensure your product listings and website are optimized for voice search. You can achieve voice search optimization by using natural language processing and long-tail keywords. Make sure to provide concise and precise answers to common questions as well.

10. Automated product descriptions

Writing product descriptions that are SEO-friendly and persuasive can be challenging, even for an experienced copywriter. And if you have hundreds of products to sell, you will likely spend long hours writing unique descriptions. AI in eCommerce can assist in writing, allowing you to save time. Generative AIs, like ChatGPT, can make the writing process faster. It can generate simple, engaging, optimized, unique product descriptions within seconds. However, it is essential to remember that AI tools may produce text with factual inaccuracies and other errors. As such, you’ll still need a copywriter to check for these errors and deliver a high-quality copy.

11. Product bundling and promotions

For those who don’t know, product bundling is a technique in which you group and sell multiple products as a single unit for one price. It’s a promotional strategy that encourages consumers to buy more. The items should be unique and carefully selected to motivate customers to purchase a bundle. These days, you can find AI-powered solutions with product bundling functionality. These solutions can generate unique product bundles and even create titles and descriptions for each bundle.

12. Customer sentiment analysis

Customer sentiment analysis is crucial, mainly when market competition is tough. It will help you know and measure how your customers feel about your brand, product, or service. But keeping a finger on the pulse of customer satisfaction levels can be challenging since you likely have hundreds or thousands of reviews to sort and analyze. If you want to be able to sort through and analyze tons of reviews and feedback fast, AI can help. AI can quickly process large volumes of customer feedback, giving eCommerce companies actionable information and valuable insights.

13. Landing page personalization

Paid ads are vital to the eCommerce industry, as they grow brand awareness and drive customers to an online store. However, many eCommerce retailers have trouble achieving high conversion rates on these paid campaigns, which cuts their profit. The bottleneck of your PPC ads might not be the ad itself but rather the landing page that customers see after clicking. Using customer segmentation to ensure your landing page content is relevant to each customer can skyrocket your paid ad performance.

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14. Personalized product recommendations

Just as the way people shop has changed, so has their expectations. Today’s customers want to receive a personalized experience when shopping online, and when retailers deliver that experience, they’re rewarded with a 40% increase in revenue. With only 1 in 10 retailers admitting to fully implementing personalization across all channels, it’s a huge untapped opportunity.

How does AI deliver personalized product recommendations?

AI distills insights from past customer behavior data such as:

Searches
Clicks
Purchases by feeding it into data-filtering tools

Which use algorithms to recommend the most relevant items to a particular customer. It’s most often seen on websites, where retailers highlight sections that are “Inspired by your shopping trends,” suggest related add-on items in a cart, or share location-relevant content based on where the customer is.

The popularity of personalized product recommendations is soaring

Customized product recommendations enhance the shopping experience because they help customers find what they want quickly and suggest additional products they may benefit from. From the retailer’s perspective, it can significantly boost customer loyalty and provide opportunities to cross-sell or upsell. According to research by McKinsey, the business impact of using AI for personalization alone results in:

10-30% more efficient marketing and cost savings
3-5% increased customer acquisition
5-10% higher satisfaction and engagement

15. Logistics and Forecasting

While AI offers a lot to enhance the customer experience, it can also have a significant business impact behind the scenes. As the adoption of eCommerce continues to spread, retailers can use AI to manage the complexities inherent to their operations by optimizing warehouse processes and revolutionizing supply chain management. Retailers can use AI to manage supply chain management operations. For AI to support logistics and forecasting, it’ll pull data from various sources, including transactional, behavioral, demographic, and eCommerce data (e.g., how a customer reacted to a promotional email). By applying machine learning, data mining, optimization algorithms, and neural networks, retailers can analyze vast amounts of data in real-time to identify patterns and make predictions.

This is particularly useful for AI use cases in eCommerce like:

Inventory management — analyzing historical sales data, current market trends, and social listening insights to generate accurate demand forecasts
Seasonality predictions — accurately predicting demand for one-off, annual, or infrequent events (like Black Friday, where online sales rose 2.3% year-on-year)
Pricing optimization — creating dynamic pricing based on supply and demand helps to calculate the minimum discount needed to secure the sale.

AI allows retailers to automate repetitive tasks and streamline workflows, significantly reducing the time and cost associated with warehouse operations. This is helpful for things like:

Supply chain management — McKinsey research shows AI adopters have improved logistics costs by 15%, inventory levels by 35%, and service levels by 65%
Delivery — 99% of consumers say fast delivery is essential when making online purchases, which is why 42% of retailers are working on how to offer same-day delivery

16. Generate first draft sales copy fast

Got a case of writer’s block? AI can get rid of blank page syndrome in a flash. It shouldn’t come as a surprise by now that advanced algorithms used in AI writing tools can generate halfway decent sales copy within seconds, requiring minimal editing from human writers. You can do it for free with ChatGPT or Claude. Before ChatGPT even arrived, AI writing tools had been around for a few years in a more primitive form. Since they’ve been out for a while, they’re starting to improve with each release, which is excellent news for your marketing campaigns. What’s so helpful about these tools is that you can give them a prompt, and then they will generate multiple versions of text for you to choose from. You can just keep hitting generate, and it’ll try again. For example, if you want to write Google Ad copy based on a keyword and some basic information about your brand, you can receive a dozen outputs, then use the ones you like or ask the tool to generate new ones. You can create outlines and first drafts of blog posts to speed up your content marketing efforts (gotta get that search engine traffic). Despite this technology’s power, humans must decide the best options, edit, rewrite, comb through them for inaccuracies, and put the final polish on.

17. Create and enhance images

As they say, a picture is worth a thousand words. While high-quality images could cost thousands of dollars, with AI image tools, you can make endless kinds of images for free. Or you can edit existing product images to have fresh and exciting backdrops. And, if you want to make an ad or image that grabs attention, consider looking into an AI tool to help. The AI-generated image where the Pope seemingly traded his traditional attire for an oversized, white, puffy jacket. The image was a viral sensation because of how real it looked. (Not saying you should try to make an imposter brand influencer with AI)

AI image tools enable you to:

Turn your rough ideas into finished graphics.
Generate multiple images in minutes, from mockups to the real deal.
Remove the background from an image and replace it with something else.
Create quality mages without models, green screens, or renting a studio.
Make it easy to build a library of product imagery so you never run out of fresh images.
And help you launch products faster.

18. Rapidly design your next logo

Speaking of images, AI can help you with your brand’s next new logo. Maybe you’re about to start a new brand or website. If you have a logo idea living in your head, just say the word, and AI will whip up something for you. And if nothing comes to mind at all, no sweat. AI tools could prototype endless ideas for you.

19. Reduce cart abandonment with targeted remarketing campaigns

The holy grail in eCommerce? A solution to reduce the number of abandoned shopping carts. To combat this issue effectively, you can leverage AI-driven remarketing campaigns that target users who have abandoned their carts with personalized ads and incentives to encourage them to return and complete the transaction. AI can be used for segmentation from vast customer data repositories, including what pages they’ve visited and what they’ve left in their carts. By automatically flagging that, these potential customers can be added to your abandoned cart email sequence, using dynamically created content based on what remains in their cart.

20. Tailor content and advertising messages using AI-driven insights

On that note, you can also apply artificial intelligence in eCommerce to tailor content and advertising messages based on user preferences, browsing history, and purchase patterns. By leveraging machine learning technologies, eCommerce companies can analyze large datasets to:

Identify trends
Predict potential customer interests
Deliver more relevant marketing materials.

For example, an online store might use AI algorithms to recommend products similar to those previously purchased or viewed by a shopper.

Some key benefits of using AI solutions for tailored content:

Increase engagement: Personalized content keeps users engaged longer as they find it more relevant to their needs.
Boost conversions: Relevant and personalized product recommendations increase shoppers' likelihood of purchasing.
Better ROI: Tailored advertising campaigns result in better customer interactions, higher click-through rates (CTR), and higher return on investment (ROI).

21. Price your wares competitively

AI is changing the game for eCommerce brands by introducing dynamic pricing. This powerful feature adjusts prices in real-time based on what’s happening in the market and what customers are doing. It works by having AI dig through loads of data like what competitors are charging, how much demand there is, and what customers have bought. This lets your store change prices quickly to match market shifts, helping you keep up sales and profit.

The rise of AI in eCommerce

eCommerce's incredible growth curve

eCommerce has seen explosive growth, especially since the onset of the pandemic. The industry's share of total retail sales went from 13.6% in 2019 to 21.1% in 2023. This isn't just a trend; it's a significant shift in how people shop. Businesses must adapt to meet new customer expectations.

AI: The eCommerce game-changer

AI is revolutionizing how we shop online. It’s all about enhancing the shopping experience and making operations more efficient. Think personalized product recommendations that align perfectly with your interests or AI-driven chatbots providing instant customer support. These technologies make shopping feel personal and seamless.

The numbers don’t lie

By 2032, the eCommerce AI market is expected to hit $45.72 billion. Around 84% of eCommerce businesses now view AI as their top priority. Those using AI have seen over a 25% boost in customer satisfaction, revenue, and efficiency. This is why AI is crucial for survival in the fast-evolving eCommerce sector.

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Benefits of integrating AI in eCommerce

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1. Boost Productivity and Streamline Your Operations

AI can take over those repetitive tasks that usually eat up your day. Think inventory management or order processing. Automating these workflows reduces errors and frees your team to focus on more strategic roles. This isn’t just about saving time; it’s about maximizing your talent pool and putting people where they’re most effective.

2. Drive Sales with Precision and Speed

AI is like having a powerhouse marketer on your team. It can craft hyper-targeted campaigns that hit the mark with your audience. Whether through AI-powered chatbots handling customer queries or personalized product recommendations, you’re meeting customers where they are. This leads to fewer missed opportunities, a better brand image, and more sales in the bag.

3. Build Customer Loyalty with Smart Insights

Loyalty is not a given; it’s earned. AI helps you earn it by analyzing customer behavior and offering actionable insights. You can discover what keeps your customers engaged and returning for more, then tweak your strategy accordingly. Whether it’s personalized offers or improved user experiences, you’re building a brand that people want to stick with.

4. Slash Costs and Reallocate Resources Wisely

Operational costs can drain growth, but AI solutions cut through the clutter. Automating various processes means spending less on manual labor and more on what matters, like innovation or customer engagement. It’s about doing more with what you have without the added stress on your budget.

5. Enhance Security and Reduce Fraud Risks

Fraud is a constant concern, but AI-powered tools offer a robust defense. These systems can identify suspicious activity in real time, allowing you to act before it’s too late. It’s not just about minimizing losses; it’s about creating a safer shopping environment for your customers and fostering trust and loyalty.

6. Elevate Your Brand Experience Through Personalization

AI allows you to tailor the shopping experience down to the individual. From personalized recommendations to custom messaging, you create a more engaging and relevant experience for each shopper. This level of personalization can significantly boost your brand’s appeal and keep customers coming back.

How do you implement AI in your business?

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1. Define your business goals

Start with a clear understanding of what you aim to achieve. Are you looking to enhance customer experience, boost sales, or streamline operations? Pinpointing these objectives will help you evaluate the potential return on investment. Collaborate with your team to set these goals, as they will be your guiding star throughout this journey.

2. Understand implementation requirements

Bringing new tech on board isn’t always straightforward. Consider the costs, time, and potential regulatory hurdles. If your AI tool will handle customer data, you might need to update your privacy policy. Being aware of these requirements early on will save headaches down the road.

3. Focus on tools that improve efficiency and experience

The AI landscape is vast. There's no shortage of options from supply chain optimization to personalized marketing. Prioritize solutions that enhance customer service and streamline your workflows. This will not only improve the shopping experience but also reduce operational costs.

4. Avoid shiny object syndrome

It’s easy to get swayed by the latest tech trends, but not every new tool will be beneficial. Before committing to a new AI solution, make sure it addresses a specific need or challenge.

Ask yourself:

Will this tool solve a problem or add complexity?

5. Monitor and audit AI workflows

After implementing AI, keep a close eye on its performance.

Is it meeting your goals?
Can it be adjusted to better serve your needs?

Regular audits ensure the AI delivers value and adapts as your business evolves.

Trends and future predictions in AI and eCommerce

upcoming trends - AI Use Cases in eCommerce

Imagine a future where customer service feels as personal and helpful as an in-store experience but from the comfort of your home. AI-powered digital humans are making this a reality. These virtual agents can handle product inquiries, offer guidance, and even close sales, all through video calls. They blend the ease of online shopping with the personal warmth of physical retail. These digital representatives are becoming more lifelike and responsive, enhancing trust and satisfaction for users.

Automated and dynamic content creation

AI-generated content is revolutionizing eCommerce by making content creation faster, more adaptive, and more personalized. Tools now generate product descriptions, promotional copy, and customer reviews tailored to individual preferences. What makes this trend genuinely transformative is its ability to adapt in real-time, revising content to reflect inventory changes, new trends, and user data, ensuring relevance.

Predictive customer service with AI insights

AI is shifting customer service from a reactive approach to a predictive one, anticipating needs before customers voice them. By leveraging past interactions and behavioral data, eCommerce platforms can suggest products that align with shopping habits and provide tailored recommendations based on trends and preferences while delivering proactive support to resolve potential issues before they arise.

The future of AI in eCommerce

As AI technologies converge, eCommerce platforms become more competent, responsive, and deeply personalized. Future predictions include hyper-personalization, augmented reality integration, and seamless omnichannel experiences. The ultimate vision for AI in eCommerce is to make online shopping as intuitive, personal, and satisfying as visiting a favorite local store but with unparalleled convenience and precision.

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