How is artificial intelligence and cloud computing changing eCommerce?

Cloud computing and artificial intelligence (AI) have been the driving force behind the rapid development of the eCommerce industry in recent years. But how do these technologies actually work? Read on to learn!

What is cloud computing?

Cloud computing is a data processing model that uses services provided by a third-party in its own IT infrastructure. Figuratively speaking: it’s a bag with blocks – specific features, services – from which the customer can build any item (e.g. e-business), without directly bearing the cost of their purchase and maintenance. In the event of the project failure, its closure is much easier and does not require a long and troublesome process of selling the hardware.

As a rule, cloud computing services are standardized, i.e. they are not adjusted to the needs of particular clients, unlike the resources themselves – the more, e.g., bandwidth a client needs, the more of it he gets (for an extra fee, of course).

Key benefits of using cloud computing

There are many benefits to using cloud computing. Here are the most important ones:

  1. Scalability – cloud computing allows you to use any amount of resources, depending on your current needs. This is especially convenient for those who need different computing power at different times. In the case of eCommerce stores, this proves useful for e.g. Christmas shopping season. Customers usually experience the lack of such flexibility when shopping online – the store’s website loads slowly or is unavailable. Cloud computing solves this problem.
  2. Cost savings – “renting” someone else’s infrastructure and software is cheaper and less risky than investing in your own. Its maintenance is also a sole responsibility of the service provider. As a result, you only pay for what you actually use. For those entering the eCommerce industry this means a lower necessary financial contribution and a lower risk in the event of a failure.
  3. Security – cloud computing is professionally secured using e.g. encryption and only authorized persons have access to it. In addition, service providers give you easy-to-use tools for backing up your data stored in the cloud, which protects them in the event of unplanned or unintentional deletion. In the case of an eCommerce store, this means that nothing threatens your customers’ personal and purchasing data. Security is one of the main arguments behind the decision to move to the cloud.

Cloud computing and artificial intelligence (AI)

Okay, but where is artificial intelligence in all of this? Cloud computing is perfect for leveraging software that replicates – or simulates – the human ability to associate facts and make autonomous decisions, often even surpassing it. The use of AI can take many forms, but the most common is analyzing data uploaded to the AI cloud service in order to find useful correlations, dependencies and patterns in them.

AI is used in the eCommerce industry to better recognize customers’ needs and purchasing habits, which in turn allows for a more effective advertising that increases sales.

5 non-obvious uses of cloud computing and AI in eCommerce

Here are some examples of putting the solutions discussed into action:

  1. 1. Expedia

This online travel shopping company uses artificial intelligence in the cloud to adjust hotel photos displayed to the characteristics of a specific user. Digging through 10 million tagged photos of nearly 300,000 hotels from around the world, the portal displays only those illustrations that take into account user’s specific needs and are able to appeal to him. So if, for example, he or she does not travel with children, there will be no families with children in the photos of the hotels offered, so as to not discourage user from booking accommodation there.

  1. 2. Zalando

This eCommerce giant uses cloud computing and artificial intelligence to shorten the purchasing process. AI uses many recommendation engines in order to eliminate the consideration stage – all elements of the website are adjusted to client’s preferences and specific behavior.

  1. 3. Netflix

The video-on-demand (VOD) giant uses artificial intelligence in the cloud to identify users’ tastes and preferences, and to recommend content to watch. 75% of Netflix users choose movies based on such a recommendation!

  1. 4. LOT Polish Airlines

Polish national air carrier has moved its ticket shop to the cloud computing to be able to flexibly adapt to the increased traffic on its website, generated by the so-called Crazy Wednesdays. If the interest in the promo – and the server load – suddenly increases, LOT is able to use additional resources made available to it to efficiently handle this traffic.

  1. 5. Pizza Domino

The well-known pizzeria chain generates most of its sales online. Using the AI software in the computing cloud, it’s able to predict when and what pizza is ordered most often. This allows it to better organize work in selected restaurants, so as to optimize the time of pizza delivery to the customer, ensuring it takes no longer than the promised 10 minutes.

Instead of a summary

The ingenuity of the eCommerce industry in the use of artificial intelligence and cloud computing is great, but we certainly haven’t seen everything yet. Both technologies are being constantly improved, so we still have a lot more ahead of us.

This article was written in cooperation with Tomasz Stachlewski, Architect Lead for EMEA CEE at Amazon Web Services.

Written by
Jarek Wasielewski
Digital Content Specialist at ExpertSender
After work: local historian. Double bass enthusiast.
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