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Integrating AI with email marketing could reduce shopping cart abandonment

When Google stepped in last week with its new Retail Search product, it highlighted the retail industry’s abandonment issues, in which US merchants are losing $300 billion in sales because consumers can’t find not what they are looking for.

But that’s just the tip of the iceberg: shopping cart abandonment, when a customer places an item in a virtual cart without ever paying, affects 75% of purchases worldwide and can cost traders about 4 trillion dollars per year.

Read more: Google Cloud Retail Search aims to solve a $300 billion abandonment problem

Google isn’t alone in focusing on this problem: Smaller companies, such as retail software provider Fast Simon, are also trying to optimize the shopping experience for merchants and consumers in order to increase conversion rates and increase average order values.

“Getting traffic to the store and maintaining that traffic is difficult,” Zohar Gilad, CEO of Fast Simon, told PYMNTS. “So our job is to make sure that merchants can get everything they can get from the traffic that comes into their store.”

And as of Tuesday (August 3), retailers using Fast Simon — which is integrated with Shopify, BigCommerce, and other e-commerce platforms — have another tool in their toolbox: the Automation Platform. of Klaviyo marketing. Information from Fast Simon’s artificial intelligence (AI) software is now automatically integrated into Klaviyo’s workflows to help merchants create personalized recommendations to retarget customers who have abandoned their initial purchases or who may be interested in shopping. purchasing additional items.

“We take specific insights into shopper behavior and in-store behavior and connect it to email marketing to drive even better results for merchants,” Gilad told PYMNTS.

Related: AI is retailers’ new favorite tool to tackle labor shortages

Fast Simon had previously only focused on optimizing purchases for merchants when traffic came to an online storefront, but Gilad said retailers have started asking for integration with email marketing such as Klaviyo. . “When I heard about this I was like, ‘Hey, why didn’t I think of that,'” Gilad said. have the need, and we’ve just started working with them.”

Stewart Wesley, head of strategic partners for technology at Klaviyo, said the integration with Fast Simon “unlocks an exciting new strategy and use case.”

“Everyone has implemented and optimized the abandoned cart feed, but the concept of retargeting abandoned searches is essentially new,” Wesley said. “By identifying customer buying intent and sending relevant, personalized communications, Fast Simon has created a powerful new communication strategy for Klaviyo customers.”

According to eMarketer, the number of email users in the United States is expected to reach nearly 278 million by 2024, representing 81% of the population. In 2021, approximately 268 million Americans used email.

Certainly, however, email may not be where brands will find the next generation of consumers. Increasingly, the battleground is becoming social media, with social commerce expected to reach $363 billion in sales this year.

See also: Commerce is fast becoming the new battleground for social media giants

Turn to technology

Gilad previously told PYMNTS that AI could be part of the labor shortage in the retail industry, automating processes that previously required manual labor. Not only does this eliminate the need to hire someone, but it can also make the task more efficient, as the AI ​​is able to use data to determine how customers might react to something. Fast Simon also includes an AI retail merchandising tool, which allows merchandisers to create personalized and targeted customer experiences with publishers via drag-and-drop.

Retailers have also used AI for price optimization, a crucial area that has received even more intensive attention as inflation continues to rise in the United States. Matthew Pavich, managing director of global strategy consulting at Aptos, told PYMNTS that price perception is more important than ever. , with consumers comparing prices between retailers even when shopping in-store.

Lily: Retailers turn to AI to tackle inflation

“Every retailer has opportunities for price optimization,” Pavich said. “It’s just a matter of figuring out what those opportunities are.”

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NEW PYMNTS DATA: THE TRUTH ABOUT BNPL AND STORED CARDS – APRIL 2022

On: Shoppers who have store cards use them for 87% of all eligible purchases – but that doesn’t mean retailers should start buy now, pay later (BNPL) options at checkout. The Truth About BNPL and Store Cards, a collaboration between PYMNTS and PayPal, surveyed 2,161 consumers to find out why providing both BNPL and Store Cards is key to helping merchants maximize conversion.