What:  A testimony from Zalora CEO on how AI is transforming the business.

Why it is important: The article is down to earth and provides a set of examples on how department stores could address AI in their operations, if this is not yet the case.

Zalora, a leading e-commerce platform in Southeast Asia, has integrated advanced artificial intelligence (AI) capabilities from OpenAI into its proprietary platform, Titan. This move aims to redefine online shopping experiences, streamline business operations, and elevate industry efficiency standards.

Key insights from the integration:

1. Purpose of Titan: Developed by Zalora, Titan integrates OpenAI to address e-commerce challenges and bolster innovation. It automates production, refines search precision, minimizes manual work, and facilitates smarter, AI-driven customer service, according to Sumit Jain, Zalora's CTO.
2. AI in E-commerce: Jain perceives AI as transformative for e-commerce. It can reduce operational expenses, solve intricate business problems, and augment human roles. Examples include using AI for crafting product descriptions, refining search functionality, assisting customers post-purchase, and lowering production costs.
3. Search Enhancements: One practical outcome of Titan has been the "Did you mean?" suggestions for users, optimizing their product search. This has led to a 4-6% conversion rate uplift since the system's inception.
4. Operational Benefits: Titan improves operational efficiency, as demonstrated by a 30-50% increase in forecasting accuracy, enabling Zalora to scale effectively. Additionally, the system aids in enriching product descriptions and optimizing product imagery processes.
5. Automation: Generative AI is used for automatic attribute tagging (like color, style, and occasion) based on product images, leading to auto-generated SKUs and product descriptions. This streamlines search functionality, ensures quality, and reduces manual labor.
6. Business Intelligence: Zalora is leveraging AI for business intelligence chatbots, which mine stored data to provide quick and precise key findings. This expedites insight retrieval, enabling staff to focus on high-impact activities. Furthermore, AI-powered Slack chatbots have been employed for customer service and system troubleshooting.
7. Future Prospects: Beyond these applications, Zalora envisions using chatbots for other internal processes, such as handling expense claims. Jain emphasizes that the integration of OpenAI is just the beginning of their AI-focused evolution. One significant advantage of this technology is its cost-effective in-house innovation, striking a balance between developing internally and collaborating with third parties.

In conclusion, Zalora is harnessing the power of AI, through its Titan platform, to innovate its e-commerce operations, enhance customer experience, and set new industry standards.

AI in Retail: the use case of Zalora