What Is Artificial Intelligence (AI) ?
What Is Machine Learning (ML) ?
What Is Big Data & Data Analysis ?
Many people who are new to technology often confused when they hear terms like Artificial Intelligence, Machine Learning, Big Data, and Data Analysis.
These terms are used frequently in the IT industry. Their meanings are many times misunderstood by lot of people.
So let this topic be explained in a very simple way.
What Is Artificial Intelligence (AI)?
Artificial Intelligence, commonly called AI, is a broad field in computer science. It covers lot of subjects and together the total knowledge of many important subjects are classified under AI.
In simple words, AI refers to software or machines that are designed to behave in a way that shows human intelligence.
Traditional computer programs are built using fixed rules or fixed flow of logic translated into coding language. The program only does exactly what it is told to do by executing the code line by line as programmed with decision making coded by programmer.
But with AI systems, something different is done. Instead of following strict instructions forever :
- Data is fed to the system called LLMs or Large Language Models.
- Data patterns are learned from that data by AI Agents and other query programs.
- Decisions are improved over time as new data is added into the LLM as interaction with the system increases.
- New situations are handled without needing manual instructions every time as goals are given to the system,
So it can be said that AI systems are designed to learn and improve from experience and that experience comes from new data, new interaction and new situation.
Simple Example to Understand AI
Let us imagine a very simple program.
If a basic computer program is written to combine text, it will behave like this:
Input → “A” + “B”
Output → “AB”
Input → “2” + “4”
Output → “24”
This program simply follows the rule it was given.
But an AI-based system behaves differently.
When an AI system sees:
“2” + “4”
It may understand that numbers are involved.
So it may produce the answer:
6
And if something like:
“CAR” + “TRUCK”
is given, the system may recognise that the input does not represent a meaningful calculation.
So the ability to understand context is what AI systems attempt to achieve.
Artificial Intelligence is a very large umbrella concept. Inside this umbrella, several technologies exist such as:
- Robotics
- Speech recognition
- Computer vision
- Natural language processing
- Machine learning
One of the most important parts of AI is Machine Learning.
What Is Machine Learning (ML)?
Machine Learning is considered a subset of Artificial Intelligence. This means that Machine Learning is one part of the larger AI field. In traditional programming, rules are written manually by programmers by using a specific coding language. But in Machine Learning, those rules are not written directly.
Instead in machine learning coding or programs :
- Large datasets are provided to the system.
- Mathematical models are built from that data.
- Patterns are automatically discovered.
- Predictions become more accurate over time. Here the time means as the interaction with the system increases by many users coming with new data and situations.
In simple words, Machine Learning systems learn from experience. The more data that is processed, the better the system becomes.
Examples of Machine Learning
Machine Learning is already used in many applications that people use every day.
Examples include:
- Product recommendations in e-commerce websites
- Fraud detection in banking systems
- Chat bots that answer customer questions
- Face recognition in mobile phones
All these systems become smarter as more real-world data is processed.
This is where Big Data becomes important.
What Is Big Data?
Big Data refers to extremely large and complex datasets.
These datasets are so large that traditional data processing tools struggle to manage them efficiently.
Examples of Big Data include:
- Customer purchase history from online stores
- Weather records collected over many years
- Millions of financial transactions from banks
- Social media posts and interactions
- Geographic and satellite data
Big Data is usually explained using something called the 3Vs.
1. Volume
A massive amount of data is generated.
2. Velocity
Data is generated very quickly, sometimes in real time.
3. Variety
Different types of data exist such as text, images, video, audio, and numbers.
Machine Learning systems depend heavily on Big Data.
Without large amounts of data, AI systems cannot learn effectively.
What Is Data Analysis?
Data Analysis is the process through which raw data is converted into useful information.
This process usually involves several steps.
First, data is collected from different sources.
Then:
- The data is cleaned
- Errors are removed
- Data is organized
- Patterns are examined
- Insights are extracted
The goal of data analysis is to help businesses make better decisions.
For example, data analysis can answer questions like:
- Why did sales decrease this month?
- Which product sells the most during festivals?
- Which customers are likely to stop buying from the company?
When these questions are answered using data, smarter business decisions can be made.
Difference Between Traditional Programming and AI Programming
Let this difference be explained in simple terms.
| Regular Program | AI-Based Program |
|---|---|
| Fixed rules are followed | Learning from data is performed |
| Only predefined answers are given | New situations can be handled |
| Manual updates are required | Systems improve automatically |
| Unknown inputs cause errors | New patterns can be learned |
Traditional software needs engineers to constantly update the rules.
But AI software can adapt and improve using learning algorithms.
How AI Is Transforming E-Commerce
Artificial Intelligence is expected to completely transform the e-commerce industry. Several major improvements are already being introduced.
Personalised Shopping Experience
AI systems analyze customer behavior such as:
- Purchase history
- Color preferences
- Budget range
- Device usage
- Clicking patterns
Based on this information, a unique shopping experience can be created for each visitor.
The website layout, products displayed, and recommendations may change dynamically.
Smart Product Recommendations
Instead of showing the same products to every visitor, AI systems analyze:
- Past purchases
- Browsing behavior
- Demographic information
- Seasonal buying trends
As a result, two customers rarely see the same recommendations.
Intelligent Search Results
Search results can also change depending on several factors.
These factors may include:
- User location
- Local festivals
- Time of the year
- Current demand trends
For example, during Diwali in India, festival-related products may automatically appear higher in search results.
Fraud Detection
AI systems can analyze many signals to detect fraudulent activities as such:
- Payment behavior or payment pattern of last transactions
- Customer profiles to filter out suspicious people
- Order frequency to understand the intent and psychology of the customers
- Geographic locations from where unusual suspicious web traffic comes
Suspicious activity can be detected in real time.This helps prevent financial fraud and reduces losses for online businesses.
AI-Powered Customer Support
Customer support is the main area that should be improved with AI.
AI chat bots can:
- Answer frequently asked questions in human like convesation
- Categorise incoming emails into folders as per their importance and utility
- Transfer complex issues to human agents, if they can not be solved by AI Agents
Over time, these systems become smarter because every conversation is analysed.
Dynamic Pricing
Dynamic pricing is applicable for eCommerce stores where AI can help in adjusting prices automatically based on:
- Competitor prices
- Supply and demand
- Seasonal demand
- Festival demand surge
This helps companies maintain optimal inventory levels and maximise profits.
Final Summary
The four concepts can be summarised very simply.
Artificial Intelligence (AI)
A broad field focused on building intelligent systems.
Machine Learning (ML)
A part of AI where systems learn from data.
Big Data
Extremely large datasets used to train intelligent systems.
Data Analysis
The process through which useful insights are extracted from data. AI should not be thought of only as robots. It should be understood as systems that learn, adapt, and improve continuously.
For businesses, especially e-commerce companies, AI can help in many ways:
- It is useful in personalising customer experiences.
- It is best for improving product recommendations
- It is capable of detecting fraud
- It is the most important technology for automating customer service and this is the area where maximum application of AI will be made.
- It is good in optimising pricing strategies
AI is not meant to replace humans.
Instead, it is designed to enhance human decision-making and efficiency because human mind has limitation for woking on large dataset.
65 responses to “Artificial Intelligence In E commerce”
It's amazing how far A.I. and robotics have come! This was a very interesting read. Learning that A.I. can and will change the look of a site based on the viewer's personal tastes blew my mind! This would greatly help sellers. 🙂
Christie's Take on Life.
It's astonishing how much AI is actually used in today's technology and how big companies, even if they don't admit it, they use it a lot (and the biggest is Google). I think it's just a matter of a few years until the technology as we know it it's gonna drastically change. I work with big data every day and I know how fast thing evolve.
It is amazing how A.I. Now helps to speedup transactions and others. Am excited what it can do more.
I think this is going to be really helpful when it comes to customer service issues. Very informative post!
Dear Philips,
Thank you for appreciating my post.
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Thank you Christopher for appreciating my thoughts. It is the encouragement of you good souls that makes humans to do good work.
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Thank you CJ for appreciating my post. It is the encouragement of you good people to keep me going for doing good.
Once again thank you.
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Thank you for sharing excellent information. Your website is very cool. Fully useful your blog post… Women's Online Fashion Store
I do agree that machines are only created by human intelligence. The scary part is human's themselves are allowing these machines to take over jobs for everyone. The human race is changing rapidly due to these issues. In saying all that, I dont complain making things a little easier for myself, especially in the work place.
Thank you Chelf for appreciating my post.
The area of sales and marketing is going to be impacted most. Big Data technology coupled with AI and Machine Learning algorithms will help in Sales Forecast and planning of sales strategies.
Yews , we like it or not AI and robotics has became integral part of our life . They are also going to wipe out millions of job in IT/ITES sector .. But that's the feature of technology ,it evolves .
Thanks Chandresh for giving feedback. I do agree with you that most of the routine jobs in IT/ITES sector will be wiped out in near distant future.
These questions definately need to be asked and discussed, as this is in the not so distant future. Let's not take it to the Skynet and Terminator level though:)
Dear Running Mart,
Thank you for visiting my blog. I am happy that my blog helped you.
Regards
nice one
It is quite intimidating to know how advanced technology is becoming but instead of being scared we should embrace its brilliance. After all a world where e-commerce is accentuated by AI can only be a good thing right?
Thanks Via Bella for appreciating my post.
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Thanks ana de jesus for liking my post. AI and Machine Learning will surely make a difference in E commerce sector and it will increase the concept of personalized selling. Beyond that who knows what the future holds?
Regards
Hi,
Akhilesh Maurya,
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Runningmart
Thanks Akeh for liking my post. I appreciate your thoughts. We are becoming less human.
Regards
What an interesting (and very informative post!) I've definitely seen the use of this within customer service with chatboxes and whatnot as you mentioned. I remember when AIM had something similar and it was SOO mindblowing back then that it's become more commonplace now.
This is an interesting topic and talk of the town (in my opinion). AI is threatening a lot of things. But I think there will always be a difference between AI and a human being. AI can never do what a human can do and humans will always be able to do what AI can do and I think this is the difference maker. Very nicely, well written and informative post.
Thanks for this interesting post. AI is now being use in banking. And its cool for convenience.
A.I. is surely gonna make things for humans easier in the near future.
Thanks Phil for sharing your valuable insight. However, I still doubt that almost all types of jobs will be taken by machine. There are many many creative fields where human mind can not be replaced by machines in distant future.
I read this quote somewhere and like it personallly, "artificial intelligence is no match for natural stupidity."
Yours was a nice post to read, but I still worry about the future!
Thank you Joanna for appreciating my post. It is great to hear that you are working with "Big Data" everyday.
Thank you Jojo for appreciating my post.
AI and robots I find so interesting. It's crazy to think that the world has gotten so advanced where we use robots on a daily basis now.
Computers are genius and the base for my work, since started blogging I have learned so much, but would love if they would just read my mind and did everything without input!!
https://www.quora.com/unanswered/What-are-the-best-AI-based-customer-engagement-tools
Thanks Lauren for sharing your thoughts. However, in my opinion Skynet and Terminator level catastrophe is not possible at least in our lives simply because the intelligence will be controlled and managed by human beings.
Thank you Ania for liking my post and thoughts. The future is not so distant when monotonous tasks will be replaced by robots and AI based systems.
This is actually pretty intriguing and you did a nice job covering all sides of the issue. Nicely done!
Thanks for appreciating my thoughts.
Thanks My Teen Guide for appreciating my writing. Yes, you are right. These technologies will help humans in nearby distant future, but those days are far away when they will start replacing human beings.
Regards
Thank you Vicky for appreciating my thoughts. I completely agree with you that there will always be difference between AI and human being.But they will start providing supplementary intelligence to human beings on many levels. The main task of AI and Machine Learning algorithms will be to complement human intelligence with vast source of knowledge and enhance the decision making power for day to day life.
Once again thanks for sharing your valuable insight.
Regards
Hi, I find the concept of AI and computers exciting yet exciting at the same time. I was interested in the reference to customer sewrvice that you used. Ok don't thin will take the place of all jobs though.
Thanks Blair for appreciating the thoughts. Yes, AI and machine learning will penetrate in the all the core area of operations of a futuristic bank where bankers will rely on intelligent AI based algorithms to suggest products/services to customers. It will also change the way of sales and marketing operations of a bank because
huge data of customers is available with them.
I was actually reading about this last night and listening to a Ted Talk about this topic. It's really scary how the machines can actually learn to become smarter over time. Like how the machine won against the world champion of the Japanese board game Go. And how the AI machines are creating their own language to communicate with each other! Fascinating stuff, yet scary at the same time.
Thanks for sharing! That post is really very interesting and super informative at the same time!
It's great that artificial intelligence mechanisms can triage phone calls complaints etc. I don't believe that these machines will replace human workers though because there will always be someone needed to repair and maintain the machines. It amazing what humans have been able to build within the last 20 years.
Thank you Taiwo for appreciating my post. Off Course, the best of user of AI and machine learning will be in the area where office assistants or personal secretary will be replaced by intelligent chat bots or virtual personal secretory.
I don't mind some AI, but I prefer human beings. I'd rather discuss something with a person if something goes wrong!
Thanks Dreammerin for appreciating my post. It is my little effort to spread a bit of knowledge in the world.
Regards
It is an exciting and scary time all at once. At some point we just need to stop taking away the jobs!
I think this is so cool. I don't mind some artificial intelligence but for the most part, I like dealing with actual human beings.
Dear Jhilmil,
Thanks for reading my post. I appreciate your feedback. With AI & machines, we may be able to replicate intelligence of mind. But emotions can never be replicated. Emotions are not part of the mind.
Emotions are part of our soul and heart and they come from our life and living soul. No machine can replicate that. Because machines can not have souls on spiritual journey.
We are all having human body having spiritual journey.
The whole philosophy of "Buddha" is to remove mind which is the reason of sorrow. It is the mind that creates competition,hate, jealousy,greed and cunning nature.
Our souls are filled with love and compassion. It is just we realize when we take spiritual path. Machines can never replicate that simply because they are not living being.
A little bit of my soul pouring…
Once again thanks for reading.
Regards
This is very much an interesting post and it is quite the scary thought about AI but yet at the same time exciting. Which is why us humans like it so much!
~ http://viabella-thebeautifullife.blogspot.com/
Thank you little foot Adventures for appreciating my post. Research is being carried out and scientists are discovering new facts about our mind and how it thinks ? Technologies are being developed to read human thought patterns.
You can find some input in this area in this blog post:
Computer Reads Thoughts Instantaneously
Regards
Its a wonderful post and very helpful, thanks for all this information. You are including better information regarding this topic in an effective way.Thank you so much
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I've never thought about this. You've definitely done a great deal of research into the topic. We all certainly want to have a "wow" factor.
Thank you Besties for liking my post. Yes, you are right and machines can never match natural intelligence or stupidity of human beings.
Regards
Thanks Christie for reading the post.
I love all the discoveries and development in the technology sector because it makes my work easier. I just don't it is cool if robotics / AI will take over human jobs. Technology can help, but not replace.
Thank you Ronak for appreciating my post. Your thoughts are very relevant and we are going to witness a new technological revolution.
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Thanks Priyanka for reading my post. You have exactly pin pointed the area where AI and Machine Learning algorithms will start making mark soon. Most of the customer service jobs require thorough understanding of customer psychology and individual customer's persona. Ultimately, customers are human beings.
AI and Machine Learning algorithms coupled with Big Data technology will help in generating accurate individual customer's profile which will truly represent individual customer persona.
Intelligent agents and chat bots will help customer service agents to accurately diagnose customer's problem at a given time and take appropriate decision.
We may see very exciting times in the future for call center and BPO industries.
Regards
Thanks Mary for reading the post. Yes, it is scary time. A lot of new type of jobs will be created and many more might be destroyed.
Ohh.. Sometimes I feel this world will turn into just AI & mchines & there will be no emotions left. They are making things really easy & creative but I still feel that we are losing the basics somewhere due to them.
Interesting. I prefer human intelligence because you never know what can happen with robots. I guess I've seen too many movies about that, ha. But I see how they can make life easier if done correctly.
Thanks Blair for reading the post. I will keep you posted the kind of tasks which can be handled by AI and Machine Learning.
The world is turning into robots , whilst AI is useful in the sense that things get done quickly it's sad that many people are being made redundant and we can no longer communicate with fellow humans , making the world a sad place to live. Don't know what the next 50 years will look like .
sounds very promisisng indeed! It's interesting how it will affect the way of sales!
Thanks Pinkiebag for liking my post. Yes, you are right. Not all jobs can be performed by AI and Machine Learning.
Thanks Kelly for liking my thoughts.