Revealed: Two-thirds of retailers are using AI to drive personalisation

An impressive 65% of tech teams are already using AI within their personalisation strategies, according to the Personalization Playbook, a new report by Talon.One, Bloomreach and Orium.

Research conducted with 400 IT leaders working in the sector revealed that another 30% of firms are exploring AI’s capabilities and planning to integrate it in the future.

UK retailers are leading the charge, with 72% of those surveyed saying either AI is a central component of their strategy around personalisation or that they are using it for specific personalisation tasks.

The improvement in personalised customer experiences, already witnessed across the industry over the last few years, is set to continue with email, mobile apps and websites the top three channels of focus for retailers.

Endless opportunities

The retail sector has only scratched the surface of AI and there are many further possibilities and ways in which to integrate it to enhance customer experience.

One way to improve personalisation is for retailers to sync their entire product catalogue and then use AI to generate thousands of individualised adverts in seconds.

Data on demographics and visit history can also be used to create super-customised product recommendations.

Cost-cutting concerns

However, despite the sector’s hunger to invest, budgets remain a concern.

Among UK retailers, budget constraints were named as the biggest hindrance with 37% of respondents saying budgets were preventing their company from offering better personalisation.

Unsurprisingly, given the background of economic uncertainty, reducing costs is the number one priority for tech teams, with the research revealing that cost cutting is the biggest priority for 41%.

Yet retailers made it clear they won’t hold back from investing in new technology this year, with 74% looking to improve their tech stack to offer better opportunities for personalisation.

Cross-function collaboration

However, to perfect personalisation, teams need to work more collaboratively, and success relies on getting the appropriate buy-in and the right stakeholders involved.

The report found that just 25% of tech and marketing teams work together to deliver personalised cross-channel customer experiences.

If retailers are to reap the rewards of their new investments, tech and marketing teams need to work closely to identify customers’ current pain points throughout the omnichannel journey and ways to solve them.