AI Is Poised to Change How We Shop: Here's What You Need to Know From how we discover and verify products to how we interact with merchants, AI is set to rapidly change how we shop. Here's how businesses can stay competitive in the new landscape.

I had a conversation with a robot recently, and I have to admit, it wasn't half bad. Like most consumers, I typically dread automated interactions when I call for customer support, but on this occasion, the bot was surprisingly helpful and my issue was resolved before the urge to hit zero for human intervention took over.

It got me thinking, for all the legitimate concerns around the rise of AI, as the technology improves it offers a clear advantage to online businesses: It's leveling up the baseline of the customer experience.

The AI market size is projected to grow from $86.9 billion last year to $407 billion by 2027. With virtually every industry looking to scale operations through AI, the impact on ecommerce will be staggering. Yet, as the online customer experience improves, I predict we'll see a return to some of the traditional ways brands have differentiated themselves in the past. Here's why.

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AI is leveling the playing field for customer service

The integration of Siri and Alexa into our lives happened slowly. It started with simple voice commands like making a call or relaying the weather and stunted when we asked more complex questions that were met with an unreliable response.

Now, as 300 million American households actively use smart home devices, voice assistants like Siri and Alexa have become an accepted part of our daily lives and as the technology improves we're seeing businesses from Shopify to Zoom to Alibaba, launch AI-powered assistants to service their clients at scale.

From an ecommerce perspective, as improved AI assistants and super-powered chatbots rapidly evolve and become more accessible to businesses of all sizes, brands will have to find new ways to differentiate their customer service.

Traditionally, brands that hire people who are passionate about the products and services they sell and empower employees to go above and beyond to satisfy their customers, experience greater customer loyalty and can even charge up to 5% more for products.

These old-school principles of customer service could prove as relevant as ever in the age of AI when human capital largely informs the automated customer experience.

Businesses that focus on their 'why' will have an edge

At present, a brand's ability to compete on search and have its products or services easily discovered online can make or break a business. Likewise, a frictionless checkout experience gives ecommerce behemoths a strong competitive edge — it's the reason Amazon had nearly 40% of the ecommerce market share in the U.S. last year.

AI is poised to change that. Take visual search technology, for example. Once a novelty for ecommerce sites, advanced visual search tools such as uploading an image to find a similar product or virtual try-on features are now becoming more widely adopted by both startups and established online retailers.

Similarly, Shopify's Shop Pay is democratizing checkout, making a seamless experience accessible for any business. As these technologies become more mainstream and less of a competitive differentiator, businesses will be forced to rethink their value proposition.

Even in the current market, studies show consumers are four to six times more likely to purchase from and champion purpose-driven companies. As AI helps equalize the customer experience online, companies that dive deeper into their "why" and integrate intention into every touch point of the customer journey will have an advantage.

Related: Top 6 Ecommerce Trends You Need to Know in 2023

Niche businesses will be better positioned

The success of an entrepreneur used to be widely determined by one's ability to mount a business financially and manage its logistics. As AI makes it increasingly easier to start and manage a business, companies that narrow in on a niche will set themselves apart.

American heritage brand L.L. Bean is a great example. The 111-year-old retailer successfully transitioned into the digital age through thoughtful product selection and making investments in technology that brought them closer to their customer. Likewise, businesses that have a deep knowledge of their product and strong connection with their customers will be more successful in the age of AI.

AI relies heavily on data to develop personalized offerings. Companies with a niche focus are better positioned to understand the unique preferences and pain points of their customers and leverage AI to create tailored solutions for them.

Similarly, companies that narrow their focus, are better positioned to act on the data collected from like-minded customers to identify trends, anticipate market shifts and pivot based on their customers' evolving needs.

Retailers aren't typically the most technically-sophisticated bunch — many simply don't have robust budgets to invest in technology. This can be true of leaders in any industry, but as AI becomes more accessible, we're going to see a democratization of ecommerce tools, which will force businesses to compete in new ways.