Three Ways Sharing Economy Leaders Personalize Customer Experience With Machine Learning and AI
AI and Machine Learning can improve customer experience based on data.
Did you know that 52% of consumers prefer to switch to another brand if they do not receive a personalized attitude?
Today, marketers face an uphill task of finding new ways of winning the audience and if the public demands personal approach, they need to give it to them. Leaders of peer-to-peer marketplaces like Uber, Etsy, Airbnb, and some others have already cracked the secrets of gaining and retaining the public love with the help of AI and machine learning, and they are eager to share their strategies with you.
Let’s learn how sharing economy personalizes customer experience:
- Personalized suggestions
- Personalized prices
- Conversational UI
AI and ML can improve customer experience based on data such as:
- personal profile
- previous search
- past behavior
- what similar users like
- most popular items bought or viewed
- and many more other factors
Airbnb’s marketplace, a worldwide known hospitality service that operates 3 million unique listings, uses more than a hundred signals to personalize the search for lodging in real time.
Their goal is to create a “great match between a guest and a host that’s going to lead to a great experience out there in the real world,”
says the company’s VP of engineering, Mike Curtis.
Airbnb developed the Embedding Listings technique that takes data from the previous search sessions and allows to identify similarities between listings to provide better personalization of recommendations for the next search sessions. The ML mechanism takes into account many listing features, for example, location, price, type of accommodation, and home style and decoration.
Even during the A/B test of this new feature, it was estimated that the implementation of Embedding Listings increased Similar Listing carousel CTR up to 21% and led to 4.9% more bookings.
Another example of personalization of suggestions was demonstrated by Uber.
Due to ML technologies, Uber enabled their application with smart destination suggestions mechanisms that can predict where a user would like to go based on information such as:
- current location
- time of the day
- previous history of rides.
For new users that had no previous history of requests, the system will suggest the most popular destinations judging by time and location.
In 2016, Etsy, one more sharing economy company, acquired Blackbird Technologies and began using machine learning and artificial intelligence to improve the searching capabilities of their marketplace: help buyers more easily find the relevant items.
In 2017, they launched Context Specific Search Ranking which analyzes data to create a more personalized search experience and Guided Search that helps customers to specify the search by means of suggestion search reformulations. As a result, on the Q4 2017, the company reported gross merchandise sales (GMS) broke $1 billion for the first time in its history.
“We created a more engaging experience for our buyers, and delivered our first-ever billion dollar quarter of GMS, reflecting strong growth across all of our core markets. We believe we’re well positioned heading into 2018 and we’re looking forward to a great year.” –
said Josh Silverman, CEO at Etsy, Inc.
Price estimation is a very subjective thing many entrepreneurs stuck on. It is not easy to set the balance between demand and price.
As far as Airbnb’s clients are not only those who rent but also those who own the listings, the main challenge of this latter audience is how to estimate their property correctly to get more profit. Filling in the information about the listings, most owners are hesitant when it is time to set the price.
To solve this problem, Airbnb implemented the AI algorithms in the Price Tips feature that is able to analyze several billion factors like seasonality, dates, location, capacity, type of accommodation, among others. The system provides hosts with suggestions for optimal rates that will get their places booked with a nice profit margin.
Uber also uses AI to vary the prices. Their new approach of Route-Based Pricing will estimate how much riders should pay considering the location and time characteristics. For example, going from one wealthy location to another one will cost more compared to the same mileage between poorer neighborhoods. Thus, the company tries to increase the margin and compensate their low-cost services.
For now, it is too early to talk about the results as these technologies are relatively young and definitely some time should pass.
According to Gartner, over the next 2 years, 85% of all customer relationships with brands will be carried out without interacting with a human being. This means that we have already stepped into the era of chatbots and those who implemented these technologies would gain a competitive position. With chatbots, you can offer 24/7 customer support, track user behavior, and eliminate the human factor of mistake or irritation.
Okay, that’s clear. But closer to our article title, what can we learn from the “sharing economy” leaders about the ways to personalize customer experience with ML?
Uber uses chatbots to enhance customer loyalty. While being at the wheel, the driver cannot type answers to the customer questions about Uber services. But the chatbot can. This can save customers’ time to find information and provide around-the-clock worldwide service.
But Uber did not stop at this. They integrated their app with partners in hospitality services like Hilton and Zomato to personalize customer experience using AI for each user. For example, you will be able to check the menu or hotel room facilities via the app on the way, before you arrive at the destination point. And, integration with Citymapper allows Uber’s customers to easily plan their route, combining Uber with metro or any other public transport.
Today’s marketing and sales are highly dependant on how well you understand your audience and strive to give them exactly what they want. Nowadays, no general approach is acceptable if you really want to stand out among competitors. You need to surprise and inspire your customers, make their choice even simpler, retain their attention and fidelity to your brand with personalization of suggestions, price, and experience.
If you still hesitate on whether you should modernize your legacy application, the answer is obviously YES! It is the high time for this!
We hope that this overview of the experience of sharing economy leaders inspired you. Using the power of artificial intelligence for customer engagement, you will definitely make headway and become a force to reckon with in your industry.
At Greenice, we are always glad to help, consulting you on the most cutting-edge technologies and selecting the best solution for your business!