By, Arsh Kabir Gujral, Chief Revenue Officer, Genefied
The Indian retail market is complex, featuring diversity across demographic and cultural characteristics. Further, the large socio-economic divergence also adds to the tricky nature of the market. Clearly, winning over customers in such a market is not a mean feat. It requires firms to synergise their creativity, innovation, and decision-making capabilities and to that end, artificial intelligence (AI) can play a crucial role. Especially, AI can prove to be a game changer for small businesses as the technology can offer them a level playing field.
Leveraging advanced AI solutions brands can ensure exponential growth, even those operating at a regional or hyperlocal level. As India’s economy grows and consumer demands evolve, adopting AI-driven automation and insights is a necessity. This digital disruption is poised to fuel the next wave of innovation, enabling Indian brands to engage customers deeply, operate efficiently, and grow faster.
Retailers occupy a pivotal place in the distribution network. These are closest to consumers in the value chain and have a finger on the pulse of the market. These intermediaries understand consumers and can also influence their choices to a great extent. No wonder, companies work closely with retailers to ensure the success of their brands. That said, helping retailers realise their full potential continues to remain a challenge for brands. The task is compounded by the vast spread of retailers besides their diversity in size, income, and products they offer. Applying AI solutions can help brands overcome all these challenges and here’s how the technology can act as a panacea for the retail sector:
- a) Personalised scaling: Expanding businesses by offering personalised products is not a piece of cake. However, the use of AI can help brands and retailers accomplish this herculean task frugally. AI can also enable targeted communications and tailor recommendations as per the preferences of individual users. Retailers can use AI to apply dynamic pricing in response to the real-time responses of consumers.
- b) Optimising supply chain: McKinsey’s report found that integration of AI can reduce logistics costs significantly – up to 19%. AI tools can optimise supply chains and help retailers run their businesses efficiently. Further, data analytics can help brands in inventory management, augmenting cost economics and efficient operations further.
- c) Deepening consumer engagement: AI-powered chatbots can operate round the clock and offer personalised responses to customers’ queries. These programs can also operate in vernacular languages and offer a personal touch to customers by aligning with their linguistic preferences. These bots can also be used to assist CRM agents and conduct sentiment analysis to alter the tone and tonality of the responses.
- d) Predictive analytics modelling: Predictive modelling is a wonderful tool to stay relevant in the evolving business landscape. It can offer brands critical insights into market trends and consumer preferences. The technology can also analyse geopolitics and its possible impact on the retail ecosystem. By collating data from several factors, predictive modelling can help retailers in running a successful business.
- e) Perfecting store operations: Big retailers such as Reliance Retail and Tata CLiQ are leveraging smart algorithms to optimise their store operations. AI solutions help these companies to analyse footfall, identify hot-selling items, and optimise profitability per square feet of their operations. Machine learning tools, on the other hand, learn the purchasing patterns of customers and offer recommendations to them on what products to keep and what to discard.
- f) Automated loyalty programs: Loyalty Programs are great for invoking loyalty but only if they are fully automated. AI automates reward allocations and can even personalise them to suit the specific preferences of customers. Automation of rewards also enhances customer satisfaction and increases the ROI of loyalty programs.
- g) Immersive marketing: AI can help brands and retailers develop immersive and vibrant marketing campaigns. Gen AI is specifically relevant for this task and by generating realistic images, product descriptions, and personalised recommendations, the technology can take the effectiveness of branding campaigns to a notch or two higher with the consumer insights collected.
The Indian retail market will be the world’s 3rd largest by 2030. This encouraging prediction offers immense growth opportunities for brands and retailers alike. The challenge for both brands and retailers, however, is to scale frugally while remaining committed to their customers. AI solutions can help brands overcome these challenges while aiding retailers to engage with their customers deeply. By creating a digital-first philosophy backed by investment in digital infrastructure, both brands and retailers can leverage the power of AI to achieve sustainable growth and profitability.
