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How retail changes when algorithms curate everything we buy

01/15/2019| 6:05:55 PM| 中文

The best way for retailers to protect themselves: Give customers good reasons to keep coming to them directly.

Giant travel search engines such as TripAdvisor, Expedia, Kayak, and Google Flights have all but replaced travel agents as most consumers’ travel advisors. Soon, independent curating engines like these could trigger the next wave of disruption in retail. A major part of the second stage will likely be a dramatic refinement of technologies that tailor recommendations and then scour the internet for the best deal.

A new generation of retail choice engines will work more clearly on behalf of customers by offering transparency, neutrality, and an unlimited catalog. Just as flight intermediaries such as Google Flights, Hopper and Skyscanner find the lowest possible prices, agnostic digital retail curators could direct consumers to the retailer offering the best deals — or advise them to delay a purchase when a promotion is likely. 

Below, we explore three types of digital curating engines that are emerging.

Market Mappers

Market mappers organize a vast range of choices in a compelling, transparent way in the travel industry. Companies such as Skyscanner and Booking Holding’s Kayak optimize thousands of route and carrier combinations to give users cost- and time-effective options from a complex set of variably priced airline tickets. The same principle works in retail — but on a far smaller scale up to now. 

Digital Personal Shoppers

A step beyond market mapping is to tailor offers to individual shoppers. Currently, a number of wardrobe management services do this to a certain extent using a combination of artificial intelligence and human interaction. The key technology is learning algorithms, which acquire knowledge about a customer’s stated preferences and purchase behavior in order to predict what she will want and develop tailored recommendations. 

Review Aggregators

As consumers buy more types of product online, the importance of fair reviews across platforms will increase. We expect this will lead to the rise of review aggregators across platforms in a broadening range of retail segments. As Yelp and TripAdvisor do in travel, these will filter reviews so that customers read those by people with similar purchase goals, which are most likely to be relevant and trustworthy.

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TAGS: digital retail | travel retail | Google | TripAdvisor
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