Top 6 e-commerce challenges solved by generative AI

Top 6 e-commerce challenges solved by generative AI

Top 6 e-commerce challenges solved by generative AI
Author : Anshita Solanki   Posted :

The past few decades have witnessed a seismic shift in how consumers shop. Brick-and-mortar stores are no longer the sole domain of retail therapy, with a surge in e-commerce purchases fundamentally changing the retail landscape. However, despite its dominance, the e-commerce retail market still grapples with several challenges, such as:

  • Shift in consumer preferences
  • Impending economic downturn
  • Escalating inflation
  • Heightened cost of supply chain

It has become imperative to adapt to technological advancements to address these challenges efficiently.

84% of C-level executives believe they must adopt artificial intelligence to achieve growth objectives. – Accenture

Generative AI (GenAI) has been rapidly gaining traction in recent years, revolutionizing various industries with its ability to create novel content and solve complex problems. The retail and CPG sectors are poised to be the next wave to embrace this powerful technology.

GenAI models, particularly large-scale ones, boast an impressive understanding of language, code, and reasoning, making them ideally suited to tackle the key challenges plaguing the e-commerce landscape. This blog will explore how AI-powered retail can address these obstacles and propel the e-commerce industry forward.

1. Streamlined content creation


Writing unique and engaging product descriptions, crafting compelling blog posts, and generating fresh social media content can be a significant drain on your marketing team’s resources and time.

One in two writers use AI tools to boost the performance of their content. – HubSpot


  • Data-driven content generation: Analyze data from various sources, including existing product information, customer reviews, competitor content, and even social media trends. This allows the GenAI model to understand what resonates with your target audience and the language they use.
  • Fresh and informative content: Based on its analysis, generative AI can create original product descriptions that highlight key features, benefits, and specifications. It can also craft engaging blog posts that address customer pain points, offer product tutorials, or showcase industry trends.
  • SEO optimization: Generative AI can incorporate relevant keywords naturally into the content, ensuring your product pages and blog posts rank higher in search engine results.
  • Multiple content formats: Generative AI is versatile. It can generate content in various formats, from concise product descriptions to long-form blog articles and social media captions with catchy headlines and hashtags.

Suggested: Top 6 generative AI trends to look forward to in 2024

Benefits of AI-powered retail for content creation

  • Saves time and resources
  • Increases content output
  • Improves content quality
  • Personalizes content

2. Personalized recommendations


Generic product recommendations like “frequently bought together” often fall flat. These one-size-fits-all suggestions can leave customers feeling like their unique needs and preferences are ignored. This results in frustration, cart abandonment, and missed sales opportunities.

91% of consumers are more likely to shop with brands that recognize, remember, and provide relevant offers and recommendations. – Accenture


  • Deep customer profiling: Generative AI analyzes variety of data points to create a comprehensive customer profile. This includes purchase history, browsing behavior (what products they viewed and for how long), abandoned carts, and even social media activity (likes, shares, and interests).
  • Understanding customer intent: By analyzing this data, generative AI can not only help you identify past purchases but also predict future needs and desires. It can understand if a customer is browsing for a specific occasion (like a birthday gift) or if they’re in the research phase for a larger purchase.
  • Hyper-personalized recommendations: Armed with this deep understanding, generative AI can recommend products that perfectly align with a customer’s preferences. It can suggest complementary items, highlight hidden gems based on browsing behavior, and even showcase products trending among customers with similar profiles.

Benefits of GenAI-powered recommendations

  • Increased sales and conversions
  • Enhanced customer satisfaction
  • Reduced cart abandonment
  • Discovery of new products

3. Better product description


Many e-commerce platforms rely on basic product descriptions provided by manufacturers or suppliers. These descriptions can be generic, lacking crucial details, and failing to address common customer concerns. This forces customers to search for additional information online or contact customer service, adding friction to the shopping journey.

87 percent of consumers consider content on product pages when making purchasing decisions. – Salsify’s “Cracking the Consumer Code” report


  • Data-driven descriptions: Generative AI can analyze a wealth of data sources, including product specifications, industry trends, and even competitor descriptions. This allows it to create comprehensive descriptions that highlight key features, benefits, and potential drawbacks.
  • Size and fit guidance: No more size chart mysteries! Generative AI can integrate size charts and fit guides into product descriptions. It can even analyze customer reviews to identify common sizing issues and suggest alternative options.
  • Detailed material information: Material specifications are crucial for informed purchasing decisions. Generative AI can generate detailed descriptions of materials, including care instructions, washing recommendations, and potential allergens. This empowers customers to choose products that suit their needs and lifestyle.
  • User-generated content integration: The power of the crowd! Generative AI can integrate user-generated content, such as customer reviews and photos, into product descriptions. This provides customers with real-world perspectives and helps them visualize how the product might look or function in everyday life.

Benefits of product description using generative AI

  • Reduced cart abandonment
  • Lower return rates
  • Increased customer satisfaction
  • Improved brand reputation

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4. Personalized engagement


E-commerce and retail companies rely on mass email marketing blasts, sending the same generic message to their entire customer base. These emails may promote new products, offer generic discounts, or announce upcoming sales. While this approach can be cost-effective, it fails to capture the individual needs and interests of customers.

80% of shoppers express a higher inclination to make purchases from companies that offer personalized experiences. – Epsilon Research


  • Customer segmentation: Generative AI can analyze customer data to segment your audience into distinct groups based on demographics, purchase history, and browsing behavior. This allows you to tailor your messaging to resonate with each segment’s specific needs and preferences.
  • Dynamic content generation: Gone are the days of generic greetings. Generative AI can personalize email subject lines, greetings, and product recommendations based on customer data.
  • Behavioral triggered emails: Leveraging customer behavior, generative AI can trigger targeted email campaigns at opportune moments. For example, if a customer abandons their cart, a personalized email with a reminder or special offer can nudge them to complete the purchase.
  • Autonomous AI agents: AI agents can provide real-time, personalized customer service. They can answer frequently asked questions, offer product recommendations based on browsing history, and even address simple customer inquiries in a conversational manner.

Benefits of personalized engagement with GenAI

  • Increased customer engagement
  • Enhanced brand loyalty
  • Improved customer lifetime value
  • Data-driven marketing decisions

5. Supply chain optimization


Traditional supply chains suffer from inaccurate forecasting, leading to stockouts or excess inventory. Disruptions like port delays further complicate matters.

79% of companies with high-performing supply chains achieve revenue growth greater than the average within their industries. – Invesp


  • Demand forecasting: Analyze market trends, social media sentiment, and even weather to predict demand shifts.
  • Inventory optimization: Generative AI’s precise forecasts ensure optimal inventory levels, minimizing stockouts and overstocking.
  • Disruption simulation and mitigation: Generative AI helps you tackle disruptions. It simulates potential issues and helps develop contingency plans.
  • Dynamic route planning: Optimize delivery routes for speed, cost, and environment.

Benefits of AI-powered supply chain

  • Reduced stockouts
  • Lower inventory costs
  • Improved delivery times
  • Greater supply chain resilience

6. Track fraudulent activity


Fraudulent transactions are a persistent thorn in the side of e-commerce businesses. From stolen credit cards to fake accounts, these activities can lead to significant financial losses and damage your brand reputation. Traditional methods of fraud detection often rely on static rules and signature-based systems, which can be outsmarted by increasingly sophisticated fraudsters.


  • Advanced anomaly detection: Generative AI learns each customer’s buying habits and identifies suspicious deviations that might signal fraud.
  • Network analysis and device fingerprinting: Identify networks of devices involved in fraud and flag orders from compromised machines.
  • Predictive analytics with generative AI: Analyze historical fraud data to identify patterns and predict future fraud attempts. This proactive approach allows you to stay ahead of the curve and prevent fraud before it happens.
  • Self-learning fraud detection: The beauty of generative AI lies in its ability to continuously learn and improve. As it encounters new fraudulent activities, it refines its detection models, ensuring your defences stay up to date against evolving threats.

Benefits of fraud detection with generative AI

  • Reduced financial losses
  • Enhanced brand reputation
  • Streamlined fraud investigations
  • Continuous security improvements

Suggested: Generative AI uses cases for the legal industry

Leverage AI-powered retail to stay ahead of the competition

In the ever-evolving landscape of e-commerce, the need to streamline operations, personalize the customer journey, and safeguard against fraud is paramount. Generative AI offers a transformative solution, empowering businesses to achieve these goals and more.

From crafting data-driven content and optimizing supply chains to thwarting fraudulent activity, generative AI unlocks a new era of efficiency and security. By embracing this powerful technology, e-commerce businesses can cultivate a seamless shopping experience that fosters customer satisfaction and fuels long-term success. Contact our AI consultants to embrace the future of e-commerce and lead the charge with generative AI.

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