Master the AI-driven digital shelf

How to turn AI in your favour to power conversion success

In today’s fiercely competitive eCommerce landscape, winning on the digital shelf — where consumers discover, compare, and purchase products — requires more than just a great product and a strong supply chain. True success hinges on making your products easily findable and giving shoppers compelling reasons to buy through best-in-class product detail pages (PDPs). 

With the rise of artificial intelligence (AI), the rules of the game are rapidly evolving. AI is revolutionising how brands create, optimise, and manage digital shelf content, offering unprecedented opportunities to stand out and drive sales.

In this blog, we’ll explore practical steps that brands can take today to drive conversion and how they should respond to the ongoing advancements in retailer AI technology. By staying proactive and adapting to these changes, you can ensure that your brand not only survives but thrives in this new era of eCommerce.

How can AI benefit brands, shoppers and retailers?

Conversion is a key driver of digital shelf success, and poor content is the number one reason consumers don’t convert online:

According to Profitero’s 2023 Global eCommerce Benchmark survey, two thirds of consumer packaged goods (CPG) companies are collaborating with their retail partners on product content optimisation. Despite this, the work is still largely being completed without the benefit of the insight and technology available to them:

• Only 15% of CPGs are using causal analytics to identify content optimisations that drive brands sales lift.
• AI usage still remains at a low level, with only 4% of CPGs fully integrating AI processes to accelerate their eCommerce growth.

Source: Profitero eCommerce Organizational Benchmark Study, 2023

Much of the reticence from brands is driven by concerns over maintaining brand governance and security. But even the early stages of AI development are providing clear benefits, particularly to brand owners:

Time and cost savings

• Identifying golden principles specific to each retailer and category to highlight the content changes that are most likely to drive search and conversion success. This is driven by AI analysis of the impact that content changes have on sales rank.
• Optimising at scale and frequency: Brands can optimise their wider product portfolio, instead of just the bestsellers. Greater automation of AI recommendations will also allow more regular seasonal content updates at scale, a feat largely out of reach for most CPGs at present.

Enhanced written content

• Keyword relevance: identifying and prioritising the most relevant keywords to optimise content and drive efficiencies in search and media sponsorship. Machine learning identifies these keywords and adds the ability to analyse product reviews at scale to highlight common or emerging trends. This ensures content creation is relevant to the specific shopper at each retailer.
• Brand guidelines: training generative AI to create written content in the correct brand tone

Impactful visual content

• Allowing greater test-and-learn projects at scale and in real time.  Evaluative AI tools such as Vizit apply virtual shopper panel insights to identify optimal images to drive better conversion.
  
  

What AI technologies are retailers adopting?

Whilst certain retailers are attempting to drive a competitive advantage through specific AI developments (e.g. Amazon Rufus, Ask Instacart and Walmart’s Polaris), common capabilities exist already amongst the AI pioneers:

Search

• Intelligent search technology: understanding the context or semantics behind consumer questions to deliver more relevant results 
• Personalised recommendations: analysing individual shopper behaviour, purchase history and preferences to deliver personalised search results. This aims to improve conversion by predicting what products a customer is likely to buy.
  
  
  

• Predictive search: making recommendations to shoppers before they complete a query based on past shopper preferences and behaviour
• Visual search: Shoppers upload photos that feed personalised product recommendations - e.g., Sephora’s “Color Match”, which finds makeup products that match a particular colour.
  
  

Examples can be found across a number of retailers including Amazon, Carrefour, Instacart, Rewe, Sephora, Walmart.

Shopping assistance

• Virtual assistants: mostly found through the retailer platform, these use AI to handle customer questions, help with order tracking and provide shopping recommendations, such as Amazon’s Rufus, Alibaba’s AliMe and JIMI on JD.com. 
  
  

• Solution provider: providing cross-category recommendations for broader shopper questions, e.g. – “What wine goes well with fish?”  “What are good gifts for Valentine’s day?” 
• Summarise product reviews: analysing review sentiment to aid purchase decisions

See examples on Alibaba, Amazon. 

Enhanced shopping experience

• Content creation: helping brands and marketplace sellers automate the creation of written and visual content, often with A/B testing capabilities
• Targeted advertising: using AI to analyse shopper data to tailor advertisements, improving the relevance of the ad and increasing the likelihood of conversion
  
  

See examples at Amazon, JD.com.

Amazon Rufus - a current case study, and a warning to brands?

Amazon utilises AI throughout its ecosystem, but Rufus, which Amazon describes as a “generative AI powered expert shopping assistant”, deserves special attention. Launched in February, Rufus is still in beta and only available to select shoppers on amazon.com.

In addition to the standard retailer chatbot tasks of order tracking and issue resolution, Rufus is able to make tailored recommendations across the entire suite of Amazon products and services.   

What’s of interest, or concern, to both sellers and vendors is Rufus’ role in updating product content, using the vast machine learning insights collected from the entire Amazon flywheel.  

Sellers can already opt in to Amazon’s Content adaptation tool, which uses generative AI to create optimised written content. However, Amazon recently announced that Rufus would automatically optimise bullet points on PDPs created by sellers as of 15th August:

Source: Amazon Seller Central

Once the text has been AI-optimised, sellers will have approximately 2 weeks to review and make any changes.   

Whilst this is currently only a seller central process, it does raise questions for brands regarding the future development of AI driven content:

1. Will this enforced content optimisation be extended to vendors on Amazon, and then be adopted by other leading retailers? If so, CPGs may need to dedicate further headcount to monitor all changes and ensure they are reviewed before release.
2. AI is not currently sophisticated enough to adhere to legal guidelines (e.g., regulatory body approved language and shopper targeting restrictions). Automated changes could make the seller (or vendor, in the future) liable to prosecution with significant financial implications. 
3. AI does not account for brand equity and benefits. AI content updates may introduce misrepresentations of the product or brand, putting brand equity and loyalty at risk.
   
   

Why brands shouldn't fear AI: the opportunity in early adoption

For the majority of CPGs, these enhancements are beyond the capabilities of most omnichannel retailers. So what should brands focus on now, and what should they be planning for in the next 1-3 years?

The current state of content optimisation in many CPG companies leaves much to be desired, and most online retail platforms have yet to fully embrace AI-driven advancements. This gap presents a golden opportunity for brands to take a first-mover advantage by adopting AI technology early.

It’s reasonable to wonder about the risk of diminishing returns as AI content optimization scales up: Won't all brands end up with a homogenised presence across every category? While this concern has some merit, we're still far from that reality.

So why invest in being a first mover? By leading the way, brands can not only collaborate more effectively with forward-thinking retailer partners but also develop robust playbooks to quickly seize on opportunities as other retailers inevitably catch up. Rather than fearing the AI wave, brands should see it as a chance to set themselves apart in a rapidly evolving digital landscape.

There are four key areas where brands can maximise their early mover advantage:

Maximise retail partnerships

• Understanding retail partners’ capabilities is essential for making informed decisions about who to collaborate with. Prioritise partnerships with retailers that not only have strong capabilities, but also show a willingness to incorporate brand feedback and evolve. Profitero’s retailer capability matrix is a valuable resource for this, available for Germany, UK, and the US.  
• Identify content levers that are most critical for driving growth with priority retailers. Leveraging AI in digital shelf analysis can help identify and prioritise these key levers, ensuring that teams focus on efforts that truly move the needle.
• Understand the most important keywords for your brands, tailored to each retailer. A one-size-fits-all approach to keyword optimization will only leave brands trailing behind their competitors. By combining an analysis of prioritised keywords with insights from product reviews, brands can optimise their content effectively. 

Get resourced for future developments

It’s clear there is still an issue with content compliance, whether that’s manufacturers failing to reach their own content KPI expectations or retailers showing incorrect content. The latter is still a major issue:

A significant challenge in eCommerce today is the lack of resources. As an eCommerce leader, it’s essential to plan not just for the current state of your operations but also for a future where AI-driven tools will play a central role. While digital shelf providers offer advanced technologies, compliance monitoring will always require human oversight. Here’s how to prepare:

• Integrate resource planning into your 3-5 Year strategy. Plan ahead: As AI capabilities increase, so too will the need for resources to monitor and respond to these developments. 
• Refine workflows for better content optimisation. AI advancements are paving the way for real-time content changes. To stay competitive, enable your teams to allow for more frequent content optimisation, especially around key seasonal events. Brands that continue to update content on an annual basis risk falling behind.
• Work more efficiently using digital shelf tools.
  
  • Ensure that content compliance alerts are in place, at least for priority products. Define clear responsibilities within wider teams, such as sales and brand marketing, for responding to these alerts.
  • Consider using automated services, like Profitero Autopilot, to ensure content compliance and accuracy with respect to your source of truth on platforms like Amazon. This can significantly free up internal resources for higher-impact activities.

Be the category thought leader

The eCategory manager is rapidly becoming one of the most critical roles in the eCommerce landscape – and it’s also the fastest-growing, with 43% of CPGs now employing eCategory managers who are 100% focused on eCommerce.

This surge comes at a time when AI-driven category insights present a significant opportunity to influence retail partners. However, many retailers are still lagging in AI adoption, and even those who have embraced it need guidance at the category level from brand manufacturers.

To capitalise on this opportunity, brands should equip their teams with the right tools and strategies to lead meaningful conversations with retail partners:

• Ensure category teams have access to retailer-specific keyword recommendations. This will enable them to optimise category taxonomies and fine-tune search and media strategies. 
• As AI advancements continue, some retailer beta programs may inadvertently affect category performance or degrade the shopping experience. It’s important to challenge these initiatives when they negatively impact your category and advocate for necessary adjustments.
• Use AI-driven insights to establish connections with retail contacts outside of the core buying teams, such as those responsible for content, search, and media. By proactively identifying and engaging with these key influencers, brands can enhance their presence and credibility within the category, lead category discussions and set the agenda.

Be the driver of AI change, not the victim

As AI continues to reshape the digital landscape, it’s crucial to take control of this change. By empowering teams with the right tools and strategies, brands can not only navigate the complexities of AI but also lead their categories to greater success in the digital retail space.

So what? Now what?

EComm leaders should ask themselves the following questions to evaluate their ability, and willingness, to face into the AI-driven future.

• Does my team understand the basic content guidelines at each retailer?
• Does my team have any insight into the golden principles for each retailer to identify which content levers are most likely to drive growth?
• Do I have clarity on a prioritised list of keywords by retailer for my category?
• Do I have content alerts set up with my digital shelf provider?
• What workflows do I have in place to react to any content compliance issues?
• Does my category management team have the right resources to speak with authority on search and content development?
• Are there ways in which I can automate my processes to free up vital headcount?
  
  

Profitero can support you with your answers to all of the above questions, through our market-leading digital analytics solutions, our automated AI-driven content capabilities and finally our global Advisory team.

For more information on Profitero’s content optimisation capabilities, please contact your Profitero account manager or request a demo.

Want to learn more about these topics? If you haven’t already secured a ticket for the upcoming Digital Shelf Summit Europe in October, we encourage you to do so here. The event will be a terrific opportunity to connect with experts and dive into the impact of AI in eCommerce, from PDP content to retail media and personalised search – and we’d love to see you there.