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January 12, 2017updated 13 Jan 2017 12:05pm

IBM puts Watson to work in eCommerce business unit

Generation Z shoppers are causing new problems for brands, so cognitive computing is hopefully going to come to the rescue.

By James Nunns

According to IBM, the majority of Generation Z customers still prefer to shop in store, but with brands struggling to meet the demands of their customers the company has decided to launch apply its cognitive computing system to an eCommerce unit.

The IBM Watson Customer Engagement unit aims to help retails to understand exactly who their customers are, where they are, and understand why they are there.

The idea is to put Watson to work on a combination of customer data, external data on weather, trends, buying behaviours and supplier availabilities in order to help retailers generate data and actionable insights so that they can better target their customers.

One of the biggest challenges for retailers is understanding their customers, such as Generation Z shoppers, which are thought to represent $44bn in estimated buying power.

Despite this group living largely digital lives, the vast majority prefer to shop in store, 66% will frequently use more than one device and 60% won’t use an app or website if they are too slow to load. According to IBM’s IBV study of 15,000 Generation Z shoppers.

Combine all of this and a demand for highly personalised interactions, a demand for quality over price, and to be engaged with by the brand across all channels, and you’ve got what seems like a mountain of a challenge.

That challenge is highlighted by Big Blue’s Customer Experience study of more than 500 brands in 24 countries, that shows that only 19% of retailers can provide a highly personalised digital shopping experience, and only 17% can provide more than just a simple in stock/out of stock piece of information.

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Another sign that these brands are slow to appeal to what will become the biggest spenders is that 84% don’t offer any in-store mobile services.

IBM General Manager of Global Consumer Industries Steve Laughlin said: “Generation Z expects technology to be intuitive, relevant and engaging – their last great experience is their new expectation.

“This presents a significant challenge for retailers and brands to create a personalized, interactive experience with the latest digital advances or risk falling behind. This kind of innovation is not linear or a one-time project – it is a new way of thinking, operating and behaving.”

IBM will be hoping that Watson will be a lifeline for those brands that are clearly struggling to adapt to a changing world. The company says that over 200 million consumers already interact with Watson through fields such as healthcare, insurance, weather, banking, travel and so on.

The business unit, a renaming of the former Commerce Bussiness within IBM, aims to put Watson, at the centre of all marketing, commerce and supply chain activities, helping to digitally transform customer experiences with cognitive computing, IBM said.

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