Many CEOs are looking at how AI tools can be deployed to improve their business. Retailers are already using it.
Sam Altman, the chief executive of ChatGPT, touted the benefits of AI and acknowledged potential downsides of the technology during a Senate subcommittee hearing on Tuesday. Photo: Patrick Semansky/Associated Press
Temple & Webster said results from initial trials of Renovai’s interior design tools and mood boards helped to boost sales recommendations and this was being converted to checkout sales. Temple & Webster recently upped its investment in Renovai through a $US2m ($3m) convertible note and is doubling down on using AI through the Microsoft-backed ChatGPT to answer pre-sale customer questions. Currently this handles about a quarter of Temple & Webster’s overall customer inquiries.
Temple & Webster CEO Mark Coulter.
This marks one of the first companies in Australia to deploy the fast-evolving ChatGPT in a commercial capacity since it was launched by San Francisco-based OpenAI last December.
Temple and Webster is also using AI to write and update product descriptions across more than 200,000 items – dramatically speeding up the process and eliminating the need for temperamental copy writers.
Many CEOs are looking at how AI tools can be deployed to improve their business. It comes while there is intense debate in the background about the rules of engagement for AI as the technology becomes more powerful. Many systems are advancing so fast they are starting to learn on their own. Overnight in Washington the CEO of OpenAI Sam Altman told Congress: “If this technology goes wrong, it can go quite wrong.”
While banks and mining are among the biggest spenders on technology in Australia, it is retailing that is leading the way on AI.
For many companies – such as in Temple & Webster’s case – the initial benefits of AI will be in using the technology in customer service and through a deeply personalised experience. At the other end of the scale are companies like biotech giant CSL that is looking at whether AI can underpin research and development to speed up the pace of uncovering potentially lifesaving drugs.
AI lowers costs
Temple & Webster’s chief executive Mark Coulter says as a pure play online retailer he needs to be at the front of technology. He believes the potential for AI to lower costs, drive conversion and customer satisfaction will be material.
Super Retail CEO Anthony Heraghty
Others such as Super Retail Group are also rolling out AI across their online sites that includes Super Cheap Auto, BCF and Rebel. But the real benefits for a bricks and mortar operator like Super Retail are through inventory management across its warehouses and helping to speed up order management for delivery. Super Retail generates more than $600m in digital sales. The retailer finds that margins per online sale are higher than in-store sales.
The supermarket majors Coles and Woolworths are also spending billions of dollars building out smart warehouses to get products on the back of home delivery trucks faster and cheaper. With average stores stocking 20,000 items, analytics have been in place for years to help inventory management.
One area Super Retail is also getting a boost from tech is through the management of its 14,000 staffers. It and other large retailers are using analytics to better understand peak shopper times to make sure the right staff are in place.
This helps to forecast when more staff are needed through the day and outside seasonal events like Christmas or Easter. The rosters also work with Super Retail’s five industrial staff agreements that cover a collective 17,000 different workplace rules.