Using artificial intelligence to revolutionize retail

y Rhapsody Budiono, PT Technical Supervisor. Ellajaya Swashimbhada, Tbk

Eraspace is part of Indonesian listed company Erajaya Swasembada, the largest lifestyle distributor and retailer with more than 1,800 offline stores across the country. Since the epidemic, trends have shown that online shopping has grown rapidly and is becoming the new normal. Eraspace’s goal is to provide a unified shopping experience across all channels.

Now, where does artificial intelligence come from and how will it help our business? Their contributions mainly include three points.

Personalized customer experience

Today, customers expect a personalized experience. Understanding how to customize recommendations, content and preferences will increase the chances of customers purchasing our products. We can achieve these goals by leveraging big data built from their past purchasing history and even browsing behavior. Once we have enough data, we can do segmentation analysis and see their patterns. For example, what’s the correlation between browsing luxury bags and buying an iPhone? Acquiring customers is important, but retaining customers is even more important. Implementing generative AI in the form of chatbots will provide instant customer support, which will improve the experience while reducing labor costs.

Optimize operations

With thousands of orders placed every day, implementing artificial intelligence into our supply chains and operations is inevitable. To scale, we need to help users. The most common problem in retail is fraud. Implementing artificial intelligence algorithms based on our data modeling can detect patterns of fraudulent transactions, thereby reducing financial losses caused by fraudulent transactions. Additionally, manual and repetitive administrative work is common when running operations. This can lead to human error due to a variety of factors. The solution we implemented was to automate the order process.

“Companies should consider challenging their leaders to develop a roadmap that includes AI, because sooner or later AI will become part of our daily lives and we are more likely to see benefits once implemented”

Improve decision-making

In order for us to make informed decisions and adapt to market changes more effectively, we need to analyze historical and real-time data. Of course, the quality of the data will determine the accuracy of the forecast. Most companies have not adapted to big data and artificial intelligence, and their job is to make the data collection relevant. The process begins with gathering information from a variety of sources. Raw data may often be confusing, incomplete, or contain outliers. Once everything is integrated into a data repository, the next data preprocessing process can begin. Cleaning the data and converting it into a usable format are key points that play a vital role in forecast accuracy.

To summarize, we are still in the early stages of AI and most people have only glimpsed it; however, it is clear how AI can bring value to businesses. Companies should consider challenging their leaders to develop roadmaps that include AI, because sooner or later AI will become a part of our daily lives and we are more likely to see benefits once implemented.