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Industry experts are divided on how and where artificial intelligence is best used, but is AI worth the money that retailers are investing?
The continued evolution of the shopping mall means new advancements in technology as retailers and REITs try to keep up with the demand of customers and shopper behaviour.
Artificial intelligence looks to be the next shiny object that REITs (and technology at large) are looking into to further enhance the shopper experience. Forecasts from the International Data Corporation (IDC) estimated that the 2019 spend on AI systems would reach $36 billion for the global market. Retail alone was projected to spend $6 billion on AI as shoppers demand better customer experiences.
This article from Andrew Blatherwick at Retail Wire had several controversial opinions about implementing AI in a retail environment, stating that it lowers customer engagement and shifts onus of tasks from employees to customers.
While we agree that the method of implementation is crucial to getting AI right, we disagree that the entire idea is worth throwing to the side.
Innovation for the sake of innovation is often a flash in the pan attempt at jumping on a trend or wave to access the ‘right now’. While it helps to capture a few additional sales at the time, it does not do much for long-term success if it’s not backed by an effective digital strategy.
Blatherwick does get it right when he says that the end goal of AI always needs to be keeping shoppers engaged. Any technology that helps extend time in store, time at a service, or time in property further increases the probability of securing a sale.
Additionally, customers are expecting personalization at a higher scale than ever before, even as far as to have it affect their shopping decisions based on offers and deals that brands send ‘exclusively’ for them. Pairing this personalization with in-store offers or exclusive products further helps push along traffic into brick and mortar locations.
Above all else, investment in technologies like AI usually means that a REIT is investing in their portfolio as a whole. The outcomes are twofold - one: to increase shopper time on property and increase sales, but two: to gather data about shoppers, what they prefer and what doesn’t work for them.
Rather than gathering data on the individuals, however, the data gathered points more to shopper behaviour and patterns en masse, helping to future predict trends and successes.
Businesses need to be smart about what they deploy and when, but that is not unique to AI.