What are AI Agents? 

An AI agent is a smart system (such as chatbots, virtual assistants, or recommendation engines) that handles customer inquiries independently, using machine learning and natural language processing (NLP) to manage tasks ranging from simple FAQs to complex problem-solving. These agents continuously improve by learning from each interaction, making them an increasingly popular trend in retail. 

AI agents benefit retailers by offering 24/7 customer support, personalising the shopping experience, and increasing operational efficiency. They help reduce response times, boost customer satisfaction, and free up human staff to focus on high-value tasks, making them a valuable tool for driving engagement and conversions in the digital marketplace. 

How do they work? 

• Data Collection. AI agents gather data from multiple retail touchpoints, such as browsing behaviour, purchase history, and social media. This data helps personalise customer recommendations and improve inventory planning.
• Identify patterns for decision making. AI agents identify patterns in data to support decisions like demand forecasting, pricing, and stock management. Recognising these patterns helps retailers anticipate customer needs and respond proactively.
• Execute actions. AI agents can automate tasks, from processing orders to handling customer inquiries. In retail, they streamline processes like updating inventory, managing returns, and sending personalised promotions in real time.
• Continuous learning. AI agents learn from new data and user interactions, improving over time. In retail, this means better product recommendations, targeted marketing, and more efficient service as the system adapts to trends and feedback.