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Businesses must harness the power of machine learning (ML) to stay competitive. With consumer shopping preferences continuously shifting, it's more crucial than ever for retailers to adopt advanced technologies that can enhance their operations, improve customer experiences, and drive sales. Let's explore how machine learning can transform retail in 2024 and beyond and how Nisum can help you stay ahead of the curve.

The recession as well as business closures have made consumers change their habits of what they’re buying, when, where, and how. This could also be termed as a paradigm shift in consumer shopping preferences.

According to research completed by Raydiant, 55.6% of consumers surveyed said they prefer to shop online, highlighting the consumer shift from in-store shopping to online and mobile channels.

Now is the peak time for sellers to think digital, with a focus on providing highly personalized product promotions, omnichannel experiences, and customer-centric services such as subscription services, curbside pickup, one-day delivery, self-checkouts, customer-controlled substitutions, and contact-less delivery.

As consumers increasingly prefer online shopping, businesses must adapt to these changes by leveraging machine learning to enhance their digital analytics capabilities.

Here are some key areas where machine learning can provide significant benefits:

1. Manage and Forecast Business Demand Using Machine Learning 

Machine learning algorithms can help retailers forecast demand and manage their supply chains more efficiently. By analyzing large datasets, ML can predict trends and customer behavior.

Demand forecasting helps a business streamline its production and procurement activities and estimate budgets and financial planning by addressing supplier relationship management, marketing campaigns, order fulfillment and logistics, manufacturing flow management, and customer relationship management. 

With machine learning predictive algorithms, businesses can: 

• Streamline production and procurement activities
• Estimate budgets and financial planning
• Optimize supplier relationship management, marketing campaigns, order fulfillment, and logistics
• Improve gross margins through better demand forecasting

2. Forecast Financial and Product Reserves With Machine Learning

The financial stability of every business has been severely tested during the recession. Retailers can use machine learning predictive algorithms to aid in financial forecasting and inventory management. The use of predictive algorithms can help retailers:

• Assess financial stability and understand customer lifetime value (CLTV)
• Prepare budgets and manage inventory levels to avoid stockouts
• Predict the impact of financial amendments on loans and agreements
• Cut costs through reduced shipment charges and improved order fulfillment

3. Predict and Manage Supply Chain With Machine Learning

Inventory, order, and warehouse management systems seem to be becoming the crux for the management of disruptions in supply and the possible reduction in long-term demands. During these testing times, many retailers could not predict and meet customer demands due to a lack of supply chain visibility. Machine learning provides better insights into supply chain data, enabling retailers to:

• Improve visibility and transparency in inventory management
• Make informed decisions about material sourcing and supplier risks
• Manage inventory under one roof with digital analytics

4. Offer Better Customer Services Using Machine Learning

Studies show that customer service agents are becoming increasingly overwhelmed with customer service chat requests continue to rise, and support teams handling 138% more inquiries. Meeting these demands is challenging for human teams, making ML/AI chatbots appealing. AI chatbots, utilizing artificial intelligence and natural language processing, can manage high ticket volumes efficiently and operate 24/7 to meet increasing customer demands. Early prediction from Gartner says “By 2025, 85% of customer service interactions will be handled completely by AI.” 

• Understand customer actions in real-time and predict their next steps
• Develop personalized services and marketing strategies to boost salesImplement chatbots, content for customer self-help, and predictive analytics
• Measure customer satisfaction (CSAT) to tie insights with business questions

Embrace Machine Learning Capabilities To Stay Afloat in the Market

Considering this shift, retailers must innovate to meet market demand and provide a better customer experience. At Nisum, we understand the importance of digital transformation for retailers. Our expertise in machine learning and advanced analytics can help you:

• Harness AI and ML to reveal trends, perform sentiment analysis, segment customers, and predict lifetime value and delivery dates
• Optimize business strategies to improve demand forecasting accuracy, increase segment sales, and enhance estimated delivery date (EDD) accuracy
• Personalize customer experiences with AI-driven features, resulting in higher customer loyalty, increased add-to-cart rates, and improved sales
• Maximize supply chain efficiency with predictive analytics, enhancing visibility, forecasting, and inventory management
• Optimize decision-making with advanced risk management solutions for fraud detection and anomaly insights

How Nisum Can Help