CEO at JOOR.
In the last 15 years, we’ve seen slow but significant advances in AI when it comes to retail. We can all remember when AI-powered “bots,” or virtual assistants, began showing up on most major retail websites to assist with consumer questions and complaints. Soon after, AI began to assist with proactive recommendations for the consumer.
Today, most of us are aware of the potential for AI to disrupt the retail industry, but much of this has focused on the customer-facing elements. What often gets missed in this conversation is the potential for the same technology to accelerate retailers’ digital transformation journeys.
Many brands first invested in their B2C e-commerce experience, but they’re now recognizing the importance of investing in an elegant B2B experience to facilitate and grow their wholesale business. Retailers can benefit from a digital transformation of their wholesale process in myriad ways. Let’s take a closer look at a few of the main perks that digital transformation can unlock.
• Increased Efficiency: Often, teams are located across several different cities or even countries. Digital tools allow you to work seamlessly from anywhere in the world, without having to catch up with your team hours or days later. That means reduced waste and spend on travel.
• Elimination Of Manual Errors: Just like you wouldn’t want to write by hand every email you send nowadays, no one wants to rely on pen and paper notes after a client meeting. Digital tools encompass all the important parts of a meeting in the showroom as they happen. Furthermore, the massive amounts of time and energy spent manually inputting information into a digitalized system can now be spent on more productive tasks.
• Reduction Of Operational Spend: A digital wholesale experience provides flexibility for brands and buyers to collaborate without the constraints of time and geography. Digital buying and selling also creates increased efficiency, allowing retailers to reduce time-to-site and helping brands and buyers decrease travel and time spent in appointments. It also reduces wasted resources like excess samples and inefficient travel.
• Real-time Data To Inform Decision-Making: Access to real-time sales data enables more informed business decision-making to drive growth.
In this nascent phase of retail AI, we can foresee the benefits of digitalization multiplying and having an even greater impact on both business success and, ultimately, the consumer experience. The most impactful applications of AI include predictive analytics, inventory optimization, proactive recommendations and product recommendations that will appeal to the customer.
Forecasting has historically been a tricky practice for retailers to navigate. AI can analyze sell-through data to predict precisely which quantities and styles a buyer needs for the upcoming season.
The pandemic proved to all of us that forecasting is necessary in order to stay ahead. Manually inputting data into enterprise resource planning (ERP) systems can take days or weeks, and by that time, the data itself isn’t current. AI can allow retailers to analyze all their data in real time and automatically keep ERP systems current.
Inventory optimization has also been an easy way for retailers to make mistakes as the economy fluctuates. Instead of wasting precious hours on manual entry and counting, AI can manage this task in a fraction of that time. This can not only save costs but reduce waste in an era when more and more retailers want to be eco-conscious. If the past few years have shown us anything, retailers will thrive only once they’ve mastered their supply and demand.
There may be additional brand partnership opportunities you don’t even know exist yet, but AI does, and it can recommend what would complement your current assortment for the season. Just look at several examples in recent months to see why these are so important, particularly for beauty retailers. Ulta Beauty sought out Google for virtual try-ons, and L’Oréal announced a partnership with Verily to more effectively research skin issues and reimagine new product development.
In the not-so-distant future, we can expect to see virtual try-ons, authentication of counterfeit accessories and more become commonplace. Advertisements could be completely personalized using AI. Maybe we’ll finally get access to that Clueless outfit creator that Cher Horowitz showed us so many years ago. For now, we have a ways to go.
But I do know one thing: Taking advantage of AI to optimize business processes not only benefits the retailer but also the end consumer, due to more tailored assortments on the selling floor and an overall superior customer experience. But to leverage AI and take advantage of these advancements, you need to have already digitalized your processes.
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