How AI Is Transforming the Retail Industry

Here are the six ways in which AI is helping businesses flourish.

Artificial Intelligence (AI) has been a hot topic in both media and business circles ever since OpenAI’s ChatGPT blew up. This, however, does not come as a shock since the capabilities of said technologies are quite extraordinary.

In 2022, data showed that retail e-commerce sales exceeded $5.7 trillion globally. And the figure is expected to grow by 56% by 2026, reaching about $8.1 trillion. The numbers are astonishing and the surge in retail customers means that a number of retail businesses are looking into new technological trends and advancements, one of them being AI.

The use of AI in the retail space has truly revolutionized the way consumers shop and interact with brands online. AI-powered technologies have helped online retailers streamline their operations, provide personalized shopping experiences, and increase sales. The use of chatbots and automated messaging systems allowed retailers to communicate with customers in real-time as well as 24/7. Meanwhile AI-powered product recommendations are helping businesses stay at the top of their game by boosting product sales.

Chatbots and AI-powered product recommendations inspired us here at Exarta to create Zeniva, a purpose-built virtual AI assistant that supports global brands with a seamless transition from Web2 to Web3.

Sounds like the future? Maybe because it is!

Here are the six ways in which AI is helping businesses flourish.


Convenience is king and AI powers strong brand-to-consumer relationships. It fosters customer loyalty with frictionless journeys from site entry to checkout.

This is done as AI provides personalized experiences for individual users by analyzing customer behavior and preferences to provide recommendations tailored to individual customer needs. And returning customers can receive recommendations based on browsing behavior and purchase history. This leads to increased engagement, conversions, and a surge in those all-important sales.

Previously conducted research showed that visitors tend to spend more time shopping on retail sites that install advanced AI experiences because it makes their shopping experience so much more enjoyable. This, in turn, increases the likelihood of the same users returning to the website to shop again in the future.


AI-powered chatbots and virtual assistants engage with customers in a way that feels more personal and emotional, as though they are talking to a human being. This leads to a stronger connection between the customer and the brand, increased loyalty, and repeat business. 

In such safe, AI-powered, online spaces, consumers are free to experiment with their identity with no consequences, be guided through options by a friendly face, and receive immediate answers to any questions or concerns that they may have, and this can also be done in real time. In addition, consumers feel a sense of familiarity due to tailored experiences and security in their product selections based on well-explained and personalized recommendations.

For example, AI chatbots are often transparent when customers ask questions about a company’s privacy policy, or how the brand stays committed to sustainable practices. And when consumers believe in a retail brand’s transparency and authenticity, they are more likely to trust the company and emotionally attach themselves to the brand’s story. This, in turn, leads to true brand loyalty and repeat customers.


AI eliminates the guesswork for retailers when collecting, managing, and distributing ever-growing amounts of data. Brands can achieve that once out-of-reach dream of simplifying every part of the customer journey.

Through the use of automation, analytics, and data orchestration, AI capabilities can provide valuable insights by analyzing customer data to depict a target audience’s interactions, interests, and preferences.

Retailers can thus use AI to tailor marketing campaigns, improve customer service, and optimize website layouts.


Gen Z are by far the largest cohort of online shoppers, and something not everyone may know is that they value personalization more than anything else because they prioritize individuality and authenticity.

This is why Gen Z shoppers expect brands to offer tailored experiences that align with their needs, preferences, and values, thus feeding into the unique individualities.

Through machine learning, AI can detect which marketing-messaging tones customers have best responded to, or which area of an e-commerce site has the best click-through rates.

Therefore, retailers can base their marketing messages on a customer’s individual interests, purchase history, location, and past brand interactions.

Overall, such insightful data will be able to increase a website’s conversion rate and improve overall customer experience, making it more engaging, relevant, and memorable.


One of the key pillars of a successful business is great customer support. However, for online stores that work 24/7, keeping staff to monitor chats around the clock can be tricky and expensive.

Through machine learning, AI avatar assistants are always on and improving. They listen, learn, and automatically assist in every conversation and in any language.

By providing quick, effective, and personalized customer support, AI avatars help build trust and a sense of community with customers. And since they are available 24/7, customers feel seen, heard, and valued. This can lead to increased customer satisfaction and retention—without the staff costs.


Sometimes, brands get stunted when strategizing around the community because their attention does not always align. It is like they’re trying to be something they’re not just for engagement, hopping on to the latest technology trends for all the wrong reasons. And modern consumers see right through that.

Therefore, retailers should leverage AI to gather data and feedback from their community and then implement that feedback into their company goals and marketing strategies.

In addition, through the use of AI, companies can showcase their commitment to sustainability, optimize their site’s performance, and foster a sense of community.

Overall, AI could be considered as everything the future of e-commerce has been looking for. And in the modern business world, the marketing leaders that leverage AI to improve customer satisfaction will replace those that do not.

Rashid Ali is the Co-Founder and CEO of Exarta. He is an experienced senior leader with a demonstrated history of working in the information technology and services industry for over two decades.