Artificial Intelligence (AI) is everywhere! AI-generated text, images, videos, AI-driven discounts offered by eCommerce stores, and data collected via AI. AI is omnipresent and it’s only getting more advanced.
Businesses are using AI tools and capabilities to improve their work, output, and performance. And why not! AI makes work faster, ensures more consistency, and accuracy.
So, have you wondered how you could use AI for Shopify subscriptions? This blog delves into the many ways AI can help subscription businesses work smarter and better.
Read on!
Customer-facing AI applications
There are multiple things AI can help you with. For instance, it can help you with customer-facing activities, and with processes that enhance your business operations. Let’s begin by exploring the ways in which you can use AI for customer-facing processes for your Shopify subscriptions business.
1. Personalized recommendations
71% of consumers expect brands to offer personalized experiences. But you might think personalization is not possible in subscriptions. Think about personalized product recommendations.
For instance, whether you offer fixed subscription boxes or curated boxes, you could share product recommendations with your subscribers. Here’s how AI-powered subscription management can make personalization easier for you:
- Gather data about subscribers past purchases and browsing activities
- Collect information about customers personal preferences
- Know your customers better by simple details such as their gender, age, location, profession, spending capacity, etc.
The above information can help you come up with recommendations that match your customers personality and preference. And AI applications are the best way to know what products you must recommend to which customer segment.
2. AI-powered dynamic pricing and discounts
Discounts and pricing are among the key factors that influence customers’ purchase decisions. However, customers’ spending capacity and budgets vary. For instance, one customer segment may be more likely to buy a product at a lower price only, while another segment is willing to pay a higher price for the same product.
You can use AI to analyze these and other customer behaviors related to pricing and discounts, to increase sales. Let’s look at some ways to do so:
- Collect data on customer behaviors and to segment customer groups
- Predict when customers might cancel or leave a subscription, offer real-time discounts to retain the customers
- Offer trial periods to leads that are hard to convince
- Create offers and incentives, such as limited-period discounts
- Gauge how much customers are willing to stretch based on their past purchase patterns and offer relevant pricing and deals
Example:
3. Automated customer support
86% of customers are willing to switch brands because another brand provides better customer support. With extreme competition between subscription businesses, you don’t want to lose customers to your competitors. To retain subscribers, ensure efficient customer support. Put AI on the job. Here’s how to use AI for Shopify subscribers support:
- Automate customers support via chatbots
- Integrate AI-driven assistants to handle common customer queries
- Automate churn management, payment failure or billing issues, etc.
- Use AI to enable customers to modify subscription plants, pause subscriptions, etc.
4. Automate churn prevention
Today, it’s easy for customers to leave one brand and immediately go to the next one, because customers are spoilt for choice. This makes it critical for your Shopify brand to integrate predictive analytics for subscriptions — identify at-risk subscribers beforehand and reduce churn.
Here’s how you can use AI for churn reduction:
- Automate retention and churn management strategies with AI
- Identify subscribes that show signs of fatigue and disengagement
- Automate discounts and pricing strategies to retain these subscribers
- Offer real-time discounts and incentives
- Offer free gifts, free trials of new products, and exclusive incentives
- Automate feedback forms and email communication to retain these customers
5. AI-optimized emails and SMS campaigns
80% of customers say the experience provided by brands is as important as their products or services. And just like how communication between two individuals creates an impression, the way brands communicate with customers influences how customers engage and feel about brands.
This is where communication via emails, SMS, and other campaigns comes in. And AI can play an important role in it.
- Use AI for Shopify subscriptions to create personalized messages
- Automate relevant messages for renewals, discounts, upselling, etc.
- Create targeted campaigns based on your Shopify business goals by automating email, SMS, and social messenger campaigns
6. AI-driven fraud detection and prevention
Subscription fraud is on the rise; reports show it costs brands more than $2 billion each year. Online fraud and security is one of the biggest reasons that keeps customers away from transacting with brands. But with AI, you can keep your customers protected. Here’s how:
- Choose a Shopify subscription app that has in-built AI fraud detection features
- Automate AI fraud detection, for instance, your tool will detect suspicious subscription transactions
- Use AI for real-time data tracking, proactive customer engagement, track unusual patterns, etc.
7. AI-generated product content
Another way to use AI for Shopify subscriptions is to generate content for subscriptions. AI-generated content can help brands enhance marketing and promotional campaigns. Here’s how you can use AI for generating content for your Shopify subscription business:
- Generate AI-based text content, including product descriptions
- Create AI-based images and videos for your subscription marketing
- Automate product updates and details with the help of AI
Example:
Business-oriented AI applications
Smart businesses know how to use the efficiency and capabilities of AI to make their business processes faster, more accurate, efficient, and cost-efficient. Now let’s explore the business-oriented use cases of AI for Shopify subscription businesses.
1. AI-powered subscription management
Managing a subscription model involves several activities. For example, managing subscriber onboarding, modifying plans, upgrading and updating subscriptions, managing cancellations, sending renewal reminders, and more. For this, you need a comprehensive subscription management system.
It is not practical to perform and manage these tasks manually. That’s where AI can help automate and manage subscriptions easily. Here’s how you can use AI for Shopify subscriptions.
- Automate modification of subscription plan
- Upgrade and update subscriptions
- Cancellation management
- Renewal reminders and notifications
- Automate subscription inventory management
- Automate billing and invoicing
2. Billing and payments optimization
With the recurring-billing nature of subscriptions, AI can make processes much faster and more efficient. Moreover, AI can ensure higher accuracy and reduced errors. Here’s how you can use AI-driven recurring billing for subscriptions:
- Automate billing cycles
- Manage revenue tracking
- Manage multiple pricing tiers and usage-based billing
- Handle dynamic pricing and discounts
- Automate dunning for overdue payments
3. Inventory and fulfillment forecasting
An important element in subscription models is to ensure the right balance in your inventory. Overstocking could lead to unnecessary financial stress, and understocking will lead to failure in delivering orders. That’s why it’s critical to manage inventory efficiently. Here’s how to do it with AI:
- Use AI to collect data, predict inventory requirements
- Ensure you have stock levels to fulfill orders
- Manage pricing and discounts based on inventory levels
- Automate subscription delivery fulfillment tasks
- Automate updates based on deliveries and orders
4. AI-powered data and analytics
Getting a better understanding of customers can drive more engagement, sales, and profits. But to manually gather information from and about customers can be a daunting task, especially for high-scale businesses. This is where AI’s efficiency in collecting and analyzing data comes in.
Here’s how you can use AI-powered subscription management for your Shopify business:
- Generate data to help you understand customers better
- Understand which actions will drive most value over time and increase customer lifetime value (CLV)
- Generate AI-driven offers and incentives to increase customer loyalty and retention
5. Automate A/B testing for subscriptions
Like every business, subscription businesses also may need to experiment and run tests. For instance, your pricing model may not work for all tiers and so, you may have to tweak it. However, manual testing and experimentation may not be the best method. But you can definitely use AI for this. Here’s how:
- Use AI to run experiments to assess pricing models
- Try out different retention strategies using AI
- Run automated communication campaigns for marketing
- Assess what works and what doesn’t using AI’s data and analytics
- Create different types of subscription boxes to understand which ones work best
6. AI-based logistics operations
Logistics is a key component of subscription businesses. It is critical to ensure that subscription deliveries reach on time, as well as in good condition. The success of subscription businesses is based on products as well as the overall experience, which includes subscription delivery and logistics.
Here’s how you can use AI for Shopify subscription logistics operations:
- Use AI to manage logistics operations
- Automate shipping and delivery updates and notifications
- Use AI to predict delivery delays
- Automate communication regarding deliveries
- Integrate logistics in your subscription system for seamless operations
7. AI-based fraud and risk management
Subscription fraud can cause losses and derail businesses. It can also harm brand reputation. Hence, it is critical to keep fraud at bay and incorporate risk management systems into your subscription set-up. And this is where AI-powered subscription management can help.
- Use AI to detect patterns of fraudulent sign-ups
- Identify duplicate accounts with the use of AI
- Detect payment fraud with predictive analytics
- Identify suspicious behavior to stop fraud from occurring
Are you ready to integrate AI for Shopify subscriptions for your business?
AI has proven to be a game changer for subscription businesses. It can help you run subscription models more efficiently, leading to more sales. Not only can you use AI for customer-facing marketing processes, AI can be equally helpful for running and managing big and small tasks for your business.
If you’re looking for a Shopify subscription app that has integrated AI capabilities and features, explore Appstle Subscriptions. The app offers intuitive AI capabilities that can manage all your processes efficiently, allowing you to focus on more strategic parts of your subscription model.
