Meet Your New Customers: Virtual Assistants Powered by Artificial Intelligence

A new class of technology is emerging. It not only thinks for you, but can also perform basic tasks on your behalf. What will it mean for retailers?

A group of software engineers in Silicon Valley recently ordered a pizza. Nothing unusual in that, except the order was placed on their behalf by ‘Viv’, an artificial intelligence program which navigated the pizza company’s automated ordering process and even selected the engineers’ favourite toppings. The group included Dag Kittlaus and Adam Cheyer, two of the founders of Siri, the leader of the current generation of ‘virtual assistants’ based on artificial intelligence platforms.

Kittlaus and Cheyer have spent four years developing Viv into a leader of the next wave of virtual assistants. These VAs will perform routine tasks on our behalf: from ordering pizza to making appointments and travel or cinema tickets.

The point for online retailers is that these virtual assistants are set to become your customers, as sophisticated consumers start delegating hundreds of mundane tasks. We’ll also start to see virtual assistants who are empowered to take decisions on the behalf of consumers. Forward-thinking retailers now need to plan how they will participate by making it simple for virtual assistants to navigate their online stores.

The first wave of artificial intelligence in retail was the recommendation engine. Amazon’s highly effective indirect approach – “People who liked this book also bought …” – has evolved to the point where sophisticated retailers now recognise cues and make proactive recommendations based on their access to so much of our information. For example, a bank might promote its foreign-exchange services after noticing a customer had bought tickets for an international flight.

The second wave of artificial intelligence is the one now under way: virtual assistants who can understand our instructions and perform basic tasks on our behalf. The breakthrough has come from the ability of these assistants to learn and recognise the hundreds of ways humans can deliver the same underlying message. Over time, we’ll be talking more directly into our smartphones: not just to request information about a concert, but also to ask the virtual assistant make the booking on our behalf.

But there is a third wave of artificial intelligence that is yet to come: assistants that “think” and “do” on our behalf, as the model above shows. 

This “virtual you” will start as a virtual assistant, reordering basic grocery items for our homes, then evolve as it learns from our behaviour and makes complex decisions on our behalf. Imagine it’s Friday and you’ve decided at short notice to go away for the weekend.  You can’t face trawling through travel websites so you might ask your phone: “Find and book me the best hotel less than two hours away for Friday and Saturday nights.” ‘Virtual You’ will know exactly what sort of hotel you liked in the past, your budget and even how the traffic on Friday evening will affect your travel times. Taking all this information, it could book the best option on your behalf.

Armed with this knowledge, retailers can start to prepare now. The first step is to recognise the importance of being able to interact with the current generation of virtual assistants. The second is to make sure your online systems are VA-enabled.

In the US, the team behind Viv has already negotiated partnerships with more than 50 retailers with products ranging from food delivery to flowers. These retailers are setting themselves up for success by gaining early access to what is set to become a huge part of the market.