Mongi Gazelle

While scrolling through news pages across the hundreds of online retailers which house users in search of gadgets or snacks, I’m forced to look in a chat window that says “Can I help do something for you today?”

This procedure is more often being conducted by an AI-based system than by a human assistant. AI-driven information systems are reshaping 21st century business and shaping customers’ choices and behaviors in 21st-century retail. One great example is ShopWise – a technology startup launched in Nigeria that is using AI to disrupt the local business landscape for an up and growing market in Nigeria using AI to innovate on its own operations.

The Traditional Way: Anachronistic and Labor Demanding

ShopWise was established in 2018 using the traditional retail business model but was started with physical stores, primitive e-commerce methods, telephone sales, and social media outreach. For inventory management, promotions and customer questions, sales activities were largely manual, relying heavily on the judgment and experience of individual managers. And then things turned sour: Over time, the approach had serious flaws, stock shortages ran wild, customer inquiry ran rampant, and decisions were often based more on a snap judgment than hard-won data. And the team faced challenges with little customer knowledge, as the Co-founder of the company Adaeze Okonkwo stated. This is in line with the finding that AI can cope with large volumes of data, reveal latent patterns of behaviour, or perform mundane work better than any human hand (Marston et al., 2011).

By transitioning to cloud-based AI operations ShopWise is tackling these operational issues head-on and has now integrated them with the business process. Algorithms built to suggest products have given participants customized product recommendations driven by their browsing habits and the amount of purchases they have made in the past. AI-driven chatbots resolved customers queries in real time. Predictive analytics enabled better inventory management and predicted demand so as to minimize wastage. These technologies combine to shift out of human judgment processes and towards data-based insights into decision-making. The company’s cloud infrastructure also provided both flexibility and scalability for its enterprises able to quickly adapt according to market changes (Armbrust et al., 2010).

Financial Ramifications: Being able to Have Predictable Revenue: From Irregular to Predictive

The same applies to ShopWise’s revenue model, which has been transformed by AI. Rather than chasing aggressive short-term promotions that often saw other companies, the company launched loyalty programs tied to customer needs, leveraging an AI framework as the basis for its solutions. This led to better customer loyalty and greater predictability in income. An impressive level of performance drew outside investment, and ShopWise secured $3 million in Series A funding to establish in West Africa in 2022. In this sense, information systems turned out not only a means of operation but also an asset of strategic utility for the business growth and survival (Petrakaki et al., 2018).

Platform Expansion: Not Just Basic Online Shopping

Therefore, ShopWise pursued its strategy of digital at scale: By introducing an AI-enhanced vendor platform that enables suppliers to communicate directly with customers via high-tech, artificial intelligence-powered solutions, the company extended into new realms. This network based distribution system lessened the requirement for intermediaries, as well as creating more transparent supply chains. The cloud-based structure was able to facilitate seamless integration of the payment flow in relation to the regulation as well as the emergence of new digital environments, without the struggle of building in bricks-and-mortar physical stores (Teece, 2018)—marking a shift towards platformization, where businesses create their own ecosystems rather than one brick-and-mortar physical store.

But there are obstacles in deploying AI, algorithms have the potential to misread consumer preferences. This presented data privacy and ethics considerations, problems which, when arose, ought of course to become public knowledge. As a matter of fact, there are a few customer interactions that involve input from humans in order for it to work. ShopWise adopted an integrated mode that combines automation and human supervision for managing business practices in its type as well as reliability and service quality (Ndiwalana & Tusubira, 2018).

Conclusion

AI in retail is transforming the conversation from voice-activated bags into advanced inventory management solutions. So, while a great deal is still ahead of us at this juncture, ShopWise also demonstrates how intelligent information systems can transform retail operations and drive genuine consumer experience improvements. Beyond that, artificial intelligence can be woven seamlessly into commerce; It can also transform how customers experience shopping, generally.

References

Armbrust, M., Fox, A., Griffith, R., Joseph, A. D., Katz, R., Konwinski, A., Lee, G., Patterson, D., Rabkin, A., Stoica, I., & Zaharia, M. (2010). A view of cloud computing. Communications of the ACM, 53(4), 50–58.
Disrupt Africa. (2022). Nigerian retail startup ShopWise launches AI vendor management platform. https://disrupt-africa.com
Marston, S., Li, Z., Bandyopadhyay, S., Zhang, J., & Ghalsasi, A. (2011). Cloud computing—The business perspective. Decision Support Systems, 51(1), 176–189. https://doi.org/10.1016/j.dss.2010.12.006
Ndiwalana, A., & Tusubira, F. (2018). Software business models in emerging markets. African Journal of ICT.
Petrakaki, D., Cornford, T., & Klecun, E. (2018). SaaS and digital workflows in organizations. Information Systems Journal.
TechCrunch. (2022). Nigerian startup ShopWise raises $3 million to scale AI retail platform. https://techcrunch.com
Teece, D. J. (2018). Business models and value capture. Long Range Planning.