Artificial Intelligence And Marketing In Apparel Retail Industry - Assignment Solution

• Background 

Artificial Intelligence (AI) is already influencing many aspects of business along with main players in the market i.e. consumer, supplier and distributor. In the past decade, it has grown dramatically due to its ability of automating systems in day-to-day lives (Kumar, Rajan, Venkatesan, & Lecinski, 2019). In recent years, AI has brought upon dramatic revolution in marketing theories and techniques in retailing and manufacturing industries. In today’s digital market, the consumers especially have developed higher expectation levels for more personalized shopping experience (Wirth, 2018). Due to their higher expectations, the marketers today are working harder to up their game for improving interactions with customers and delivering their needs and desires while matching the competition. Hence, for upping the marketing game, the marketers need to deliver the right message, to right customer at the right time in order to sell their products to their segmented customer (Kietzmann, Paschen, & Emily, 2018). 

AI marketing solutions have skimmed out for bridging the gap between the data science and execution. AI marketing has now appeared to be a solution that allows the marketers to leverage the customer data and anticipate the future decision of customers so that the customers’ shopping experience stay enhanced (André, et al., 2008). AI marketing applications have the solid potential of reshaping the consumer behavior, their shopping experience and the feedback process especially in the apparel industry. The fashion brands can use the AI for maximizing customers’ satisfaction, enhance their shopping experience and improve the efficiency of sales system. 

AI marketing techniques are now being used in many ways across entire product and service cycle i.e. from development of product concept till its final consumption (Ravi, Raman, & Mantrala, 2006). According to the report by Global Market Insights (2019), the investment in AI applications in retail industry is bound to exceed USD 8 billion by 2024 as more and more retailers will focus on investing in machine learning, predictive analytics and deep learning technologies (see figure below). 

Figure 1: AI in Retail Market Share Current and Future (2019)

Source: (Global Market Insights, 2019)

The apparel industry is just like all the other retail companies that are concerned about creating demand and brand awareness amongst existing and potential customers by using different marketing techniques. Clothing and apparel brands keep on finding new ways by which they can present their products infront of potential customers for creating awareness and demand of their product in the market (Ngai, Peng, Alexander, & Moon, 2016). AI can be used by the apparel firms by using virtual trial rooms, digital racks for the fashion products and digital assistance where customer can interact directly with intelligent conversational agent that can guide the customer throughout their decision making process. AI is not only expected to benefit the retailers in every industry, but also allow the customers to make better, swift and informed decisions in the apparel industry (Ngai, Peng, Alexander, & Moon, 2016). 

Although, AI has brought immense growth possibilities to marketers, implementing it in business practices for enhancing marketing experience is still a daunting challenge for businesses. For instance, for extracting maximum benefits out of AI, number of research and business processes along with marketing strategies are required that match with the current customer mindset (Kietzmann, Paschen, & Emily, 2018). The use of AI is still facing problem in marketing industry due to privacy concerns, data leakages, ethical issues, trust problems and information transparency.