Introduction
Customer experience (CX) refers to a customer’s holistic perception of a business or brand. It is the quality of the engagements between an organization and its customers at every purchase process step. The experience may begin at the marketing and advertisement level, progress through sales, and involve customer service by summing all customer interactions with the brand. Businesses create customer experiences through their products and their people. In recent years, artificial intelligence has been adopted by businesses to help create lasting brand impressions by focusing on specific micro goals and positive moments that comprise the entire purchasing process (Ameen et al., 2020). This research will analyze Kroger Company’s current customer experience practices and propose new ways the company can leverage AI to enhance customer satisfaction, drive engagement, and foster brand loyalty.
Company Analysis
Kroger products range from grocery retailing, fine jewellery, food manufacturing, and convenience stores, among other consumer goods. The target market for Kroger Company is American households as it operates in 35 states in the United States. The company has partnered with operating systems to create a mobile application where customers can seamlessly shop online and have their products delivered. Customers can also get customized recommendations based on previous shopping practices and experience. The company seeks to leverage AI technologies to enhance its customer experience. A competitive analysis of Kroger shows that the company is the leading retailer in the American market; they have strong innovation and personalization strategies, perform more store digitization, have a growing market share, and have leveraged partnerships in improving product quality. The company’s weaknesses lie in the high debt load and low global presence. The opportunities for the company include stocking more organic products and global expansion in emerging economies. The threats to Kroger come from established industry players such as Walmart, Amazon and new entrants in the online retailing industry (Mahru, 2023).
The key customer pain points are a lack of nationwide or international coverage since Kroger operates in only 35 States. Customers require the convenience of shopping anywhere they are located. Also, the personalization of marketing messages and alerts needs to be improved to deliver targeted marketing and connectivity.
AI technology assessment
AI technology in consumer goods marketing includes chatbots, voice/face-activated interfaces, and recommendation engines. AI systems collect data points while customers engage purchasing systems and track their online presence using personal identifiers. They can generate a customer’s journey, reimagine the end-to-end experience and add new products that consumers may find appealing (Das et al., 2023). The technology is highly scalable through injecting new innovations and using updated data points and insights. Kroger will benefit from AI technologies since it can access personal identifiers from its customers such as payment details and personal emails that can be used to generate accurate data points for analysis
AI-driven personalization and recommendations
AI intelligent engines utilize customer-journey analytics tools to log user footsteps as they engage with company systems. The collected data helps to detect patterns and offer personalized recommendations quickly. Geo-tagged tracking and payment mechanisms enable companies to seamlessly integrate pre-purchase activities like marketing and advertising with purchasing and after-sales services to deepen customer engagement. In order to create smart experience engines, companies must be able to connect data signals and insights from all available sources (Graepel, 2018). AI systems reimagine the end-to-end experience as a seamless flow using automated decisions and algorithms. The experience is then activated across multiple channels to engage customers in all possible locations and satisfy needs according to context. Machine-learning technologies are always improving by using new data points and rigorously assessing the impacts of adopted decisions (Edelman & Abraham, 2022).
AI systems are able to generate a 360-degree view for each customer using various ways such as emails and other personal identifiers in social media. In conjunction with services like Experian or Acxiom they can augment basic customer characteristics. The generated data enables gender and location-based targeted marketing. The systems can also incorporate external factors such as weather, store inventory, and customer preferences to deliver personalized recommendations according to a customer’s location (Edelman & Abraham, 2022).
AI-powered virtual shopping assistants
In an effort to offer customers, virtual shopping assistants, Kroger can adopt digital shelves instead of traditional shelves. An example is Enhanced Display for Grocery Environment (EDGE), which can allow the company to digitally display product price and change it in real-time or display video advertisements and nutritional information. AI companies have been able to integrate voice and face activation technology on the digital shelves so that customers get personalized services based on their preferences, approximate age or gender. If a customer opts to receive fully customized adverts through Kroger’s app, the digital shelves will display tailored messages backed by the user’s preferences. For example, people who prefer gluten-free nutrition bars can have suggestions on where to locate the best options once they are inside the stores. AI virtual shopping assistants can be customized to be used with mobile apps or in handheld store shopping devices to create a shopping list that guides customers on where to quickly find selected items in the store (Mckinnon, 2019). The use of signalling lights on digital shelves helps customers save time by helping them find products quickly. The technology can also offer alerts for on-offer products in particular stores once customers are within the given geographical area.
Seamless order tracking and updates
By using machine learning algorithms, AI can analyze shipping data to enhance order tracking by providing customers with real-time updates on the status of their orders. Using previous experiences and current conditions, the algorithms can estimate delivery times. Customers can use chatbots to engage the tracking system and perform enquiries around the clock. Kroger Company can integrate AI seamless order tracking to current communication channels, including email and SMS communications. Seamless tracking provides timely updates on requests and at key points in the logistics process, which reduces customer anxiety and improves the entire shopping experience.
Implementation plan and metrics
To effectively implement AI into the customer experience process, Kroger will first need to define the desired outcomes by identifying the problems they intend to solve. The next step is building an AI team within the organization or partnering with established AI companies with the right tools and technologies. Data and insights gathering follow, which are then fed into the appropriate analysis soft wares. Every customer’s data is analyzed, and their shopping experiences are reimagined. The experience is then activated across multiple channels, generating personalized recommendations (Das et al., 2023).
The key performance indicators when evaluating the success of AI-powered customer experience strategies include; measuring customer engagements through interactions with the AI system, such as chatbots and the link clicks generated as a result. Also, a business can encourage customer feedback to assess whether the AI system helped achieve their shopping intentions. Incentives such as gift cards and coupons can be provided to encourage customer feedback after purchase or engagement with the system. Finally, the cost efficiency of the installed AI system is a major metric of success where company revenue and costs before and after the system are analyzed for trends (Reznik, 2018).
Conclusion
AI is the future of customer experience, and companies should embrace it to stay relevant and competitive. AI has successfully integrated into customers’ daily lives through social media, and businesses should follow suit. Leveraging AI has enhanced customer interactions and satisfaction, facilitated brand loyalty, and increased engagement in the consumer goods industry. Kroger Company adopting the digital shelves (EDGE) in all stores will help customers shop for required products in the store quickly while providing discounts and coupons with each engagement. The technology helps generate a shopping list, locate the products in the store, and choose products with discounts. Integrating AI algorithms into the mobile app and communication channels already in use will help customers have seamless shopping experiences from personalized advertising to purchasing and order tracking and finally to post-purchase services. The result is increased customer satisfaction, brand loyalty, and more engagement.
References
Ameen, N., Tarhini, A., Reppel, A., & Anand, A. (2020). Customer experiences in the age of Artificial Intelligence. Computers in Human Behavior, 114, 106548. https://doi.org/10.1016/j.chb.2020.106548
Das, A. C., Phalin, G., Patidar, I. L., Gomes, M., Thomas, R., & Sawhney, R. (2023, March 27). The next frontier of customer engagement: Ai-Enabled Customer Service. McKinsey & Company. https://www.mckinsey.com/capabilities/operations/our-insights/the-next-frontier-of-customer-engagement-ai-enabled-customer-service
Edelman, D., & Abraham, M. (2022). Customer Experience in the Age of AI [web log]. Retrieved July 21, 2023, from https://hbr.org/2022/03/customer-experience-in-the-age-of-ai.
Graepel, S. (2018, March). Artificial Intelligence [web log]. Retrieved July 21, 2023, from https://view.deloitte.nl/rs/502-WIB-308/images/deloitte-nl-data-analytics-artificial-intelligence-whitepaper-eng.pdf?
Mahru, M. (2023, February 3). Kroger SWOT & PESTLE Analysis. SWOT & PESTLE.com. https://www.swotandpestle.com/kroger/
Mckinnon, T. (2019, July 10). How Kroger Uses Artificial Intelligence (AI) to Innovate [web log]. Retrieved July 21, 2023, from https://www.indigo9digital.com/blog//kroger-use-artificial-intelligence-to-innovate-in-its-store-of-the-future.
Reznik, A. (2018, July 31). Keep an eye on these five KPIs as you drive improved customer experience using artificial intelligence. [web log]. Retrieved July 21, 2023, from https://www.verizon.com/business/resources/articles/keep-an-eye-on-these-five-kpis-as-you-drive-improved-customer-ex/#:~:text=Here%20are%20five%20key%20performance%20indicators%20%28KPIs%29%20to,4.%20Conversions.%20…%205%205.%20Cost%20efficiencies.%20.
write