The global e-commerce industry, valued at $1.55 trillion in 2015, is growing rapidly. Simultaneously, the presence of Artificial Intelligence (AI) is expanding, with a forecasted market value of $5.05 billion by 2020. These two forces are intrinsically intertwined, with AI-enhanced user experiences tackling a universal challenge: the Paradox of Choice.
AI can be employed to develop virtual shopping assistants that streamline the initial selection process. AI solves the Paradox of choice for consumers while still allowing them control over their final decision. These virtual assistants have the potential to transform e-commerce. They turn a vast array of options and long-tail shopping into a simplified discovery process with personalized recommendations based on individual needs.
2017 FightMediocrity YouTube video, in which Barry Schwartz explains the Paradox of Choice
Benefits for Online Merchants and Consumers
- Friction Reduction: AI-driven shopping assistants remove friction points that can cause impatience, an overwhelming sense of choice, and high exit rates from home or category pages.
- Long-Tail Optimization: By leveraging advanced filtering capabilities, AI-powered recommendations bring long-tail products to life,. They match potential customers with items that precisely fit their needs.
- Enhanced Efficiency: AI improves efficiency, conversion rates, and returning visitor rates. It builds on the success of existing capabilities like Amazon’s product recommendations, which account for approximately 35% of the e-commerce giant’s revenue.
Skinceuticals shopping assistant, a technology powered by NextUser
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