How Can Your E-commerce Business Benefit From Machine Learning

By Sony T
10 Min Read
E-commerce Business Benefit From Machine Learning

In the past few years, consumers have completely changed their shopping habits. Retail as we know it has been replaced by E-commerce Business, Shopping through websites is growing in popularity and one of the reasons why it is still evolving is artificial intelligence (AI).


Artificial intelligence has a huge impact on the customers’ experience, enabling companies to understand and precisely answer their needs. One of the crucial tools is machine learning.

Machine learning is an AI-driven technology that allows the software to analyze gathered data, determine insights from it, and then serve consumers accordingly to their special needs. Below, I presented some of the essential solutions that are now becoming a reality thanks to machine learning technology.

Personalized Customer Experience

Every client is unique – has different needs and behavioral habits. Retailers have been trying for years to detect shopping patterns and use them to increase sales. The process turned out to be very time-consuming and often ineffective.

Even after entering the digital era, companies failed to personalize their marketing campaigns. For instance, after purchasing one product, for another year we are bombarded with undesired emails that do not reflect our needs or taste. This is where machine learning enters.

Machine learning technology allows companies to use an algorithm that observes each activity of every client from the very beginning. Then, the software analyzes data and determines individual patterns. According to them, the system itself takes care of building personalized customer experience by showing adequate ads, sending suitable messages, and maintaining a dialogue with each customer in a way that reflects their preferences.

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According to Elizabeth Gallagher – Chief Revenue Officer at Lineate, there are two key elements leading to the right-time and right-place personalization:

“There are two main ways that marketers can impact the right time/place aspect of personalization. The first is by finding patterns in the relationship between location and engagement in the historical data brands have gathered (i.e. travelers most often upgrade airfare tickets when they are already at an airport).

The second is by finding patterns in correlations between when people typically make purchase decisions (deciding to buy a cappuccino or breakfast sandwich before they start a morning commute) and using that data to send right-time messages within those timeframes.”

Recommendation Systems

The recommendation system is one of the most effective marketing tools used in the e-commerce market. Simply speaking, it is a computer program that analyzes customers’ preferences basing on their activity in the past and recommends products that most likely will suit their taste.

Nowadays, we interact with recommendation systems every day, not only while doing shopping online but also while, for example, watching movies.

Personalized product/service recommendations that pop up on the screen result in the increase in sales, revenue, and effectiveness in general. Recommendation systems play the role of automated shop assistants – working 24/7 and taking into account every detail they already know about a particular user.

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Customer Relationship Management (CRM)

Every company has to constantly work on developing its customer relationship management. The goal is to establish the right approach to manage company’s interactions with its clients – current and potential.

There are three machine learning-based solutions that in particular give satisfying results.

1. Use predictive analytics to get a better ROI

Predictive analytics enables entrepreneurs to select the most useful information sets from the company’s database and create structured insights about customers’ behavior patterns and emerging trends.

This way, companies can adapt their business strategies faster and attract more potential clients. For those who do not want to base their decisions entirely on suggestions made by software, machine learning tools can still be useful. Predictive models are an effective way to get valuable business suggestions but that does not mean you cannot check the results by yourself and then decide on the best approach.

2.Understand your client’s decisions by connecting disparate customer data points

Customers tend to complain about the products or services even though as an entrepreneur you try to keep the highest possible quality while cutting the costs. While you cannot do much about the price, which for some clients is still too high, sometimes you may be surprised by other issues your customers mention.

By using machine learning technology in CRM, a specially designed program can do the research for you – go through each client’s data and analyze their activity. Why is it so important?

The software will alert you about the risk of a new, unsatisfied client before they will contact you to complain. This way, you can take up actions to rebuild their trust and avoid losing a customer.

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3.Find new value in unstructured qualitative data

A CRM with machine learning and NLP is able to go through all the unstructured text you gathered about a particular client and add value to all qualitative data. New information can be useful especially before actually contacting the customer. Basing on acquired insights, you can offer a personalized approach.

Only by combining both qualitative and quantitative data, you can fully understand overall sales results and make successful business decisions in the future.

The e-commerce market is already aware of the potential of machine learning. New, ML-driven innovations emerge on the market. Let’s take a closer look at some of them.

Voice Commerce

One of the top trends nowadays is the integration of voice recognition into e-commerce. With the new opportunities coming from natural language processing (NLP) we are entering a time of voice commerce.

Customers are becoming more and more familiar with voice assistants, and they are likely to make purchases with their help. NLP improves the results thanks to tools such as facilitated voice search and taking into account location and past search history.

Virtual and Augmented Reality

Virtual showrooms will become the new standard of this decade. They are growing in popularity, virtual showrooms are now available on various smart devices like laptops, mobile phones, etc. They offer a brand new customer experience – shopping online is getting closer to shopping in traditional shops, customers can “try on” products, see them from different angles, etc.

Augmented Reality (AR) is taking VR to another level. Customers can try the product in their chosen surroundings. For example, while shopping for furniture you can “put” the product in your living room and see if it fits the rest. AR provides better visualization than shopping in an actual store.

Virtual and augmented reality offer a more developed interaction for customers than any of us has ever imagined.

5G Evolution

This year, the world will be introduced to a new Internet connectivity update – 5G. According to Adobe Digital, 5G will drive global mobile e-commerce revenue by $12 billion by 2021.

It will make online shopping even faster and more convenient. The new speed will enable companies to use more advanced technologies in marketing, as well as new sales opportunities.

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E-commerce incorporates advanced technologies, groundbreaking approaches, and exciting new features. It is hard to predict how will e-commerce change at the end of this decade.

If you own an e-commerce business you should definitely take advantage of machine learning technology and invest in AI Software Development. The quality of customer services improve every year, online shopping is now a complex experience which does not end when the sale is made.

“This is the year that the theoretical possibilities will turn into bite-size changes that are truly impactful. Along with this mindset shift, companies are moving at a fast pace toward data-driven automation and machine learning in practice in strategic and target parts of the customer journey. I believe therefore that more brands will be getting personalization right at the most important parts of the funnel and will see the impact of this in conversions and revenue.” – Elizabeth Gallagher

I am looking forward to exploring what innovations the future will bring.

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By Sony T
Sony is a passionate bloggers writes on Futuristic technologies ...
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