Behaviorists and artificial intelligence (AI) have one thing in common - knowing that people are creatures of habit. Because of this general human trait, companies have been developing AI algorithms that predict our shopping list such as our groceries.
Over the past few years, shopping lists have evolved from writing down items on paper to making a list on a notes app on a mobile phone. In more recent years, developers have created systems and applications for online shopping, payment, and delivery.
Companies such as Ubamarket in the United Kingdom has upgraded their system even more. Aside from making lists and paying via mobile phone, users can also scan products for allergens and ingredients.
Shopping With Artificial Intelligence
Furthermore, retailers are using AI systems to predict and encourage specific preferences of users. Daniel Burke, a retail consultant from Blick Rothenberg explained that as customers use these apps and websites frequently, the AI algorithm learns a person's shopping habits and preferences then suggests products before the user realizes it's what they want.
For example, if you tend to order Chinese food on Saturday nights, the AI system picks up on a pattern. Ubamarket's system, explained founder Will Broome, keeps track of behavioral patterns instead of purchases. The more that a person uses the app, the AI learns their preferences.
The system learns with every new purchase and becomes anticipatory, said Broome. It even calculates how likely a user would try a new brand or pick up a new habit then suggests it. What the AI suggests is called hyper-personalized offers, like a new Chinese restaurant that just opened in your neighborhood.
Jeff Rajeck from Ecoconsultancy explained that hyper-personalization is a recent marketing trend and "tactic which leverages artificial intelligence (AI) and third-party real-time data sources to enhance brand messaging with relevant, context-sensitive information. It's very similar to how Spotify and YouTube create recommended playlists based on our viewing and listening history then recommends similar music or videos.
Ubamarket currently has partnerships with smaller shopping market chains and have yet to partner with the nation's largest supermarkets. Thanks to the pandemic, they've been able to grow as people preferred doing groceries safely from home.
With the convenience the app provides, the average basket contents have increased by 20% compared to shopping in person. Users also tend to return to shop in the same stores up to three times.
Expanding the 'Me-Focused' Lifestyle
Meanwhile, in Germany, Segment of One (SO1) has also developed an AI-based solution for a "me-focused" lifestyle. The personalized experience even includes the user's financial goals.
For retailers, SO1's system helps them focus on the right consumers without traditional methods of exaggerated discounts and mass-produced coupons that go to waste. The system also determined that users tend to choose AI-suggested products over traditional discounts.
Jen Tennison from the Open Data Institute explained that people prefer recommended products that suit their personality over promotions "based on a caricature of who they are."
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