Artificial Intelligence (AI) Agents represent a revolutionary leap in technological innovation and will transform business across every sector. They are intelligent systems that understand language and can perceive, analyze, and act upon complex data and/or workflows. “Act” is the key word. AI Agents take autonomous action on your behalf to complete the task or achieve the desired outcome.
The e-commerce industry stands to benefit enormously from this new technology because it’s a remarkably competitive and often low-margin business that unequivocally depends upon efficiency, accuracy, and adaptability for retailers and brands to be successful.
Unlike conventional generative AI that generates outputs, (i.e. recommendations, and/or a plan), from “prompts” entered by a user (such as ChatGPT, Claude, etc.), AI agents self-reflect and learn from their interactions, continuously improving their performance without constant human intervention. AI agents can complete tasks that would normally require multiple tools and different activities, and you don’t need to be a developer to create and optimize them. For example, an AI agent (or agents, plural) could build and book a vacation within a given set of limitations. Think of all the steps (research and reviews, cross-references) that a human must perform to complete the same common task. The only thing to keep in mind is not to ask each agent to do too many different things. Keep each agent “in their lane” for optimal results.
- Always-On Customer Service
AI agents don’t sleep, take a lunch break, or have a bad day. While customer service may be the lowest-hanging fruit and most easily implemented on this list, AI agents are available when your customers need them, regardless of time zone, and they can answer most of your customer’s questions and resolve most of their issues. Most importantly, they can be configured to hand off to a human when they cannot resolve the inquiry or when the conversation otherwise reaches a point where the business may want to speak directly with the customer, such as discount or refund requests. But they can indeed be employed to create replacement orders, cancel subscriptions, and adjust auto-ship frequency, among other things. - Best-in-Class Demand Forecasting
Predict demand with remarkable accuracy to optimize procurement and avoid overstocking and stockouts. Traditional approaches are often plagued by unsophisticated data analysis methods leading to bad assumptions, and thus, poor procurement decisions. But modern Inventory Management Systems (IMSs) use AI agents to analyze massive amounts of historical sales data, read real-time news feeds to consider market trends and identify supply chain disruptions, track inventory movements, plus any number of other data points of interest, to make intelligent, real-time forecasts in the context of existing inventory available across internal and external fulfillment centers. - Automatic [Humanless] Procurement
Building upon demand forecasting, AI agents can automatically create Purchase Orders with vendors at precisely the right time based on requirements such as minimum order quantity, and also based on defined guard rails such as total spend, current and future cash flow expectations, and vendor lead times for prep and transit. The best part is that it’s all based on natural language processing so if you can explain it, it can be done without complicated diagrams or wireframes. - Optimize Distributed Inventory Strategies
Minimize final mile shipping cost by staging inventory closer to your customers. Split inbounds across fulfillment centers based on the regional demand forecasting models described previously to optimize placement and minimize the cost of transferring inventory between locations later. Further, use the technology to track the inbounds and update ETAs for the team accordingly. Amazon’s been doing it for years. Now SMB retailers and brands can take advantage of the same technology. - Lowest Shipping Cost by Design
E-commerce retailers and brands traditionally have humans use their experience to ship orders, (primarily because legacy shipping software hasn’t innovated in over 10 years). But that approach is notoriously error-prone and costs the company a ton of money that should be kept as profit, even if it’s done at the manager level. Modern multi-carrier shipping software removes the human and creates the optimal shipping label that will deliver the order on time, every time. And now, combining that intelligence with AI agents, Order Management Systems (OMSs) can get even more granular and monitor weather conditions along shipping lanes, and then re-route orders to fulfillment centers that are more likely to deliver them by the promised delivery date, preventing customer service inquiries such as WISMO (Where Is My Order?) and refund requests. - Remove Waste from Fulfillment Workflows
Automate critical but rote tasks that would otherwise need to be completed by a human (e.g. creating shipping labels). Why does a human have to pick and click to print a label? Change your people from processors into analysts and put them on the tasks that will grow the business. - Supercharge Returns Programs
Returns are painful, but a necessary evil for any e-commerce operation. It’s critical to manage returns effectively (especially for the highest return rate categories such as women’s apparel). Groundbreaking new returns technologies such as the Cahoot Peer-to-Peer Returns Solution are already eliminating returns by enabling the return to be shipped directly to the next customer, saving significant money and time. Now add an AI agent that can predict the likelihood that the returned item will be sold in the next 7 days, and you’ve supercharged your returns program! - Optimize Warehouse Layouts
New technologies such as Synkrato’s Warehouse Optimization System (WOS) – powered by AI and Digital Twins are emerging to help merchants create a virtual warehouse that mimics their exact space, inventory positions, equipment storage, window and door positions, etc. which can be used to make changes in the virtual world and determine the impact of the change before going through all the work to find out that it wasn’t going to work. Optimize warehouse layouts, inventory storage, and more. - Dynamic Pricing Strategies
Unified commerce systems can leverage customer data including products viewed, dwell time, shopping cart contents, previously abandoned carts, purchase history, returns history, and demographic data in real time to create tailored shopping experiences that align with individual preferences. AI agents can monitor competitor pricing along with inventory levels and sell-through rates, read mass quantities of e-commerce news feeds to assess market demand and availability and make real-time pricing adjustments that convert the sale while maximizing profitability and remaining competitive. These personalized interactions not only drive sales but also foster loyalty. - Driving Business Insights with Advanced Analytics
Because AI agents can analyze enormous datasets quickly, and because most merchants have ‘dark data*’ that they don’t even know about, AI agents have access to many more insights and can identify many more trends than retailers can even think about asking for. At least currently. For example, Sellers can evaluate supplier performance at a micro-level comparing negotiated agreements and SLAs to actual performance and events and use the data to negotiate better terms.*Dark data refers to the unused portion of an organization’s information collected and stored during their regular business activities but fails to be used for analytics, advancing business relationships, or direct monetization. It’s not uncommon for as much as 50% of a company’s data to be dark.
Summary
The transformative potential of AI agents extends beyond mere automation rules and logic trees. AI agents are redefining how e-commerce businesses approach inventory and order management, transforming these processes from reactive tasks into strategic capabilities. By leveraging advanced technologies, these systems can dig deep into the dark data and deliver precise forecasting, intelligent automation, and actionable insights that enhance operational efficiency unlike ever before. They’re intentionally more specialized than generic generative AI such that the language that is used and the context that is understood within a particular industry or vertical, results in a more reliable and relatable assistant compared to the ChatGPTs and Claudes of the world.
As e-commerce businesses become more fluent in these new technologies and embrace these advancements, AI will transition from being a competitive advantage to a foundational necessity. Companies that integrate AI systems effectively will not only streamline their operations but also build the agility needed to thrive and position themselves for long-term success.