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Artificial Intelligence and You:

Is the A.I. Revolution an Opportunity or a Threat to Independent Retailers?

News about the Artificial Intelligence (A.I.) revolution goes from doom and gloom, inspiring fear, to glowing reports of opportunity and a brighter tomorrow. The bottom line appears to be that A.I. is here and there's no stopping it, so in this issue, we take a look at what the A.I. revolution means for independent retailers.

Amazon President and CEO Andy Jassy made headlines recently when he predicted that A.I. would "accelerate the end of brick and mortar" retail. That's not surprising since Amazon is the most visible face of online retailing and believes online retailing is the future. But, with apologies to Mark Twain, the reports of the death of brick-and-mortar retail are greatly exaggerated.

Is A.I. a Threat or Opportunity for Retail?

Even Jassy had to admit that 80%-to-85% of retail sales still take place in brick-and-mortar stores, but the reference to A.I. is a new wrinkle. What will be the effect of Artificial Intelligence on independent retailers? Does it represent a threat, as Jassy claims, or could it be an opportunity? There are valid concerns about deep fakes and other abuses of the technology, but it's been on the horizon for quite a while and the genie likely won't be put back into the bottle, so can A.I. be harnessed to advantage?

What Is It Anyway?

First, what is artificial intelligence? A.I. is a branch of computer science in which systems or machines learn to perform tasks usually performed by humans. Those tasks may include understanding language, recognizing the content of images and generating new images and/or video, and even making decisions. The machines may learn from online data such as weather patterns or stock trends or consumer buying trends and make recommendations. Chatbots like Open AI's ChatGPT or Microsoft's Copilot can act as a search engine, but can also summarize information from the Internet to present suggestions to the user, rather than just presenting search results that the user then needs to read and digest.

Consumer Behavior

So the first thing that could help independent retailers is Chat, where you ask A.I. to summarize consumer buying trends and behavior, which could help you know what people are looking for and could inform inventory decisions for your store.

As an experiment, we asked Copilot, "What kind of products are consumers in small towns looking for in stores located on Main Street?" Here are a few of the results:

• Essential Services & Daily Needs (Pharmacies, Grocery, Post Office, Bank and Newsagents)
• Food, Drink & Social Spaces (Cafes, Diners Coffee Shops and Casual Eateries)
• Unique & Curated Products (locally sourced products that reflect local identity)
• Experiential & Community-Focused Retail (pop-ups, boutique shops and small-package store layouts emphasizing curation over volume. Main streets are increasingly venues for community events, art displays, and public gatherings, enhancing foot traffic and fostering loyalty)

That represents only the beginning of a conversation, which is the main difference between A.I. chat and search engines. Copilot ended its answer with a question: "Would you like help brainstorming product ideas for a specific type of Main Street store?" which would seem like a great opportunity for further research.

Do you have an ecommerce website and do you struggle with coming up with enticing descriptions for your products? A.I. can help with that. Simply input your existing description and ask the chatbot to enhance it with descriptive wording. You will need to edit it, especially if the chatbot gets details wrong, but it may jumpstart your creativity when it comes to giving your products their best presentation.

Other Opportunities

But that's just the beginning. A.I. can also enhance your product images. Below is an example of an original image showing a product photo taken with bad lighting and composition, followed by an A.I. improved version, and finally an enhanced lifestyle image of the same product.

In the images below, A.I. was asked to take a product image of a robe and put it on a model. Then, at right, A.I. animated the still image of the model wearing the robe. First a video was created, then a free online service turned the video into an animated GIF image. Videos can be displayed on websites and social media, but not in email advertising. Animated GIFs can be included in email advertising, however.

OmegaNet Inc., publisher of this newsletter, has become active in exploring the opportunities presented by the A.I. Revolution. We can do similar transformations of your product images to what you see here at costs greatly reduced from large photo shoots. You can see more examples of photo and video manipulation here. If you would like this kind of product photo enhancement done for your store, contact OmegaNet.