A founder of the iconic music recognition app Shazam has said businesses must deploy artificial intelligence (AI) in online shopping, or risk losing out to powerful e-commerce forces like Amazon and Shopify.
Retailers who fail to adopt AI may find themselves at a significant disadvantage, particularly in an increasingly competitive and tech-savvy market, Ajay Chowdhury, the lead founding investor in Shazam in 2000 and chairman of the company for seven years, told City A.M.
“We’re certainly recommending to all our clients that they start experimenting with this. And you will get left behind if you don’t do it,” said Chowdhury, now a managing director at Boston Consulting Group.
Chowdhury said the likes of Amazon are already thinking about a more “conversational” style of shopping to drive sales.
A search bar could act as a personal shopping assistant, asking questions about what a customer wants before providing a tailored suggestion.
“Generative AI is a fantastic tool to really provide personalised shopping recommendations. What it can do is analyse your browsing history, analyse your purchase history and very quickly come up with really unique recommendations,” explained Chowdhury.
It goes beyond personalised recommendations. Other potential AI uses for retailers include improved customer service, fraud detection and more streamlined operations, like optimising supply chain routes and managing inventory more efficiently.
Embracing AI will come at a steep price. “If [businesses] want to do it at scale it’s not cheap, because when you use Gen AI, it’s constantly going back to the cloud, which uses a lot of computing power,” he warned.
But the cost of ignoring it could be higher. “There will absolutely be an early mover advantage.” Prices are also likely to come down over time, he said.
On top of that, there are “massive ethical implications”, including regulatory, copyright and security concerns. Companies need a responsible AI policy in order for customers to trust them and because there will be some exploring ways to game the system.
Businesses need to be “slightly careful in whether they go hell for leather to do this, but they have to start working on it now. They have to start experimenting.”