The Power of Behavorial and Predictive AI to Profit off Customer Behavior

When you visit your favorite e-commerce store or order groceries online, chances are you’ve quietly gone through the AI process. It’s no accident that if you’re shopping for a black shirt, you suddenly see ads to buy black shoes, or if you’re shopping for milk, you see ads to buy cereal. That’s the power of behavioral and predictive AI, and it’s quickly becoming the new means of advertising based on your habits.

Behavioral AI for the Retail Sector

As soaring inflation continues to grip and tighten purse strings, retailers, especially online ones, need a way to cut back on costs to remain profitable while retaining their members. That’s where the investment in behavioral AI enters the equation. Behavioral AI is a specific type of artificial intelligence that uses programmed models and algorithms to collect data on a user’s behavior, consumption, and spending habits.

A simple way to understand this concept is to do a simple internet search on Google. Your searches are monitored and entered in vast database libraries. That’s why after searching, for example, flat-screen televisions, the next time you head to Google Search or an affiliated site, you will find tailored ads about flat-screen televisions.

In recent years, personalized advertising has become the tool of the trade and the preferred advertising method of major retailers, online banking institutions, and even the travel and hotel industries. Personalized advertisement has proven to have a higher return on investment because instead of bombarding members with general ads they might not be interested in, they are more prone to spend on something they are interested in. For example, online casinos for real money continue to retain their membership with personalized promotions to use on games their members prefer because gaming is a personal preference.

Thanks to successful behavioral AI programming, retailers also have a leg up in future sales. If they already know what you like and with personalized content and ads, you increase your financial contribution, then the same principle works for future purchases. Predictive AI builds on behavioral AI by delivering content, services, or ads for products or services you will eventually use or buy.

The first step for successful predictive AI is record storing, which is usually the same as behavioral AI analysis. But beyond helping retailers get a jump on future profits, predictive AI is especially helpful for the financial industry, because they can rely on AI to do overnight and future trading based on behavioral AI, by having reasonable certainty that a certain stock or commodity will perform at a certain price down the right based on historical trends. With predictive AI, stock brokers and others can continue to grow their membership and profits.