When you run an online store, it’s likely you’re already using several types of artificial intelligence tools, like chatbots for customer support or algorithms that forecast demand. These tools range from limited-capability AI tools (like virtual assistants) to sophisticated AI systems that perform market analysis.
What all of these AI variants have in common is that they try to mimic human intelligence. That involves traits like image recognition, problem solving, and the ability to apply previous knowledge. Each tool offers unique AI benefits for ecommerce.
In this guide, you’ll learn how each type of AI works, why it matters in 2025, and how to use these types of AI to boost revenue and streamline your ecommerce operations.
Why AI classification matters for your online store
The current market size of AI-driven ecommerce is $9.01 billion, and it’s expected to reach $64.03 billion by 2034.

Grouping AI by capability and function gives you a clear way to match each type of AI to real business goals, such as increasing conversions, forecasting demand, or lowering support costs.
This classification of the types of AI helps you:
- Pick the right tool. You’ll immediately see whether a solution is narrow AI for one task (e.g., product-recommendation engines) or a broader platform that can learn across multiple data sets.
- Estimate effort and ROI. Capability levels signal implementation complexity, while functionality levels hint at data requirements. This is crucial for allocating time and resources.
- Future-proof your tech stack. Knowing where the technology is headed (e.g., from limited-memory systems to theory-of-mind AI) lets you adopt solutions that can scale as AI advances.
Read more: AI in Ecommerce 2025: 7 Use Cases & A Complete Guide
Capability-based AI types in ecommerce
All types of AI use some combination of machine learning (ML), natural language processing (NLP), speech recognition, computer vision, and/or robotics powered by artificial neural networks that mimic the cognitive functions of the human brain.
Here’s a breakdown of three main types of AI, grouped by capability:
1. Narrow AI: The workhorses of modern ecommerce
Narrow AI (or weak AI) excels at performing specific, well-defined tasks with high accuracy. This makes it ideal for repetitive, high-volume jobs like product recommendations or fraud detection.
Think of it as a single-minded tool that’s very good at what it’s designed for but is unable to apply its knowledge to entirely new situations.
Ecommerce-specific examples of narrow artificial intelligence applications include:
- Product recommendations. Suggests items based on what shoppers view or add to their carts. These kind of targeted promotions can boost your sales by 1% to 2% and profit margins by 1% to 3%.
- Smart on-site search. Reorders search results on your website if a query (e.g., “black sneakers”) isn’t getting clicks. This helps your customers more quickly find what they want.
- Customer segmentation. Groups buyers by behavior (like lifetime value or churn risk), which powers personalized ads and SMS campaigns that target each customer segment.
- Website analytics tools. These AI tools audit your websites and analyze site usage and customer behavior. The more data they can crawl, the better their insights.
- Automated emails and texts. Triggers messages based on past purchases.
According to the Cyber Week 2024 study, behavior-based SMS drove up to 36% conversion (Text CVR) during Black Friday sales.

If you’re a Shopify merchant, you can use Shopify Magic to instantly write product descriptions, transform product images, and create email campaigns.
Here are some more high-impact applications you can plug into your Shopify store:
Narrow-AI use case | Business problem solved | Shopify solution |
---|---|---|
Visual search & “shop-the-look” (image recognition) |
Shoppers can’t describe what they want in words. | Add a search-by-image app such as LimeSpot or ViSenze and integrate with your product-photo catalog. |
AI-driven dynamic pricing | Manual repricing can’t keep pace with market changes. | Use Shopify’s priced-in-market partner apps (like Prisync, Pricing.AI) or build a rules engine with the Shopify Functions API. |
Automated fraud-risk scoring | Chargebacks and false declines eat margin. | Turn on Shopify Fraud Control or Shopify Protect for Shop Pay orders. |
Conversational chatbots for support & sales | Human agents can’t cover 24/7 or peak traffic. | Install Shopify Inbox to manage customer conversations and create automated messages. |
AI product-tagging & catalog cleanup | Large SKU sets create messy filters and SEO gaps. | Use Power Tools Bulk Edit Tags app to generate tags and alt text. |
Artificial general intelligence: The future of commerce
Artificial general intelligence (AGI) is still theoretical, but it’s expected to match (or even surpass) human reasoning across all domains. Computer scientists envision AI machines that can learn, reason, solve problems, and adapt to new situations just like a human can.
In the future, AGI might be capable of:
- Creating original works. An AGI system could process human language to write a news article, compose a musical piece, create visual art, or even design a building.
- Understanding and responding to complex questions. Intelligent machines running on AGI could analyze vast amounts of information to answer questions in a comprehensive and informative way, even if the answers require reasoning or making judgments.
- Solving complex problems. AGI neural networks could analyze data on matters of global importance—such as water scarcity—and they could work with humans to develop effective solutions or propose solutions without human intervention.
In the context of ecommerce, AGI might be able to handle everything from strategy to execution as a single system, without switching between different tools.
Here are some potential AGI use cases and what they could mean for Shopify merchants:
AGI future use cases | Problem solved | Business impact |
---|---|---|
Autonomous demand forecasting & inventory management | Stockouts, overstock, frozen capital | AI already cuts inventory by 20%–30%. AGI could improve that with real-time purchase orders (POs). |
End-to-end campaign generation (creative, audience, budget) |
Disconnected tools, slow creative workflows | Active personalization boosts customer confidence and ROI by 2.3 times. |
Dynamic storefronts (copy, visuals, pricing per user) |
Generic experiences, wasted promotions | 71% of shoppers want businesses to deliver personalized experiences, and 76% get disappointed when they don’t get them. |
Zero-touch customer journeys | Fragmented support, upsell gaps | Triggered SMSs already lift conversions by 35%. AGI could merge sales and support in one flow. |
Generative product design | Long R&D cycles, inconsistent results | Faster launches, lower sampling costs, AI-tested product ideas |
Artificial superintelligence: Beyond current commerce
Artificial superintelligence (ASI) represents the most capable forms of AI. It’s also the most speculative type of AI development. Also known as super AI, superintelligence could surpass human intelligence in all aspects, potentially solving problems and creating products and formulas that human beings couldn’t even imagine.
ASI capabilities are purely hypothetical, but some speculations include that ASI could analyze scientific data and make discoveries that would revolutionize fields like medicine, physics, or materials science. Through a combination of analyzing past data and making new inferences, a computer could not only create new consumer goods, but also invent categories of goods that no human brain has ever considered.
While ASI is still theoretical, here’s how it could transform ecommerce once it’s commercially available and implemented:
Future ASI use case | Problem solved | Potential business impact |
---|---|---|
Autonomous product R&D & launch | New-product cycles are slow, costly, and unpredictable. | Concept-to-shelf time might shrink from months to days. |
Self-optimizing, zero-inventory supply chain | Cash tied up in stock, forecasts break during shocks. | Near-perfect in-stock rates. |
Hyper-personalized, moment-level pricing & offers | Blanket discounts erode margin. | Dynamic pricing already improves profit margins; ASI could boost that. |
Global compliance copilot | Taxes, duties, and privacy laws change too fast for SMBs. | Can eliminate fines and manual policy updates. |
“Merchant-of-one” autonomous brand management | Solo founders juggle creative, ops, and finance. | Could enable single-person, multi-brand companies. |
Functionality-based AI types in ecommerce
AI can also be categorized based on its functionality with respect to how it perceives and reacts to the world around it.
Here’s a breakdown of four main types of AI, grouped by functionality:
Reactive AI: Simple but effective ecommerce tools
This is the simplest form of AI. Reactive machines essentially respond to their environment with pre-programmed scripts. In human terms, imagine having a reflex without the learning or memory. These AI applications don’t store information about past experiences and can’t adapt their behavior based on new situations.
Here are some example use cases of reactive AI in ecommerce:
- AI customer service chatbots. These ecommerce chatbots are designed to handle routine queries (like, “Where’s my order?”), which is especially useful during off-hours when human agents aren’t available. If you’re using Shopify, you can get started by activating Shopify Inbox and loading your FAQs into its canned-response library.
- Automated order confirmation emails. Customers expect instant reassurance after placing an order and these emails deliver just that. You can create custom email workflows with Shopify Email and send automated order confirmations to your customers.
- Inventory threshold alerts. Manual stock checks often result in unexpected sell-outs or fulfillment delays, which can frustrate customers and hurt sales. By setting automated alerts, you can significantly reduce stockouts and improve overall inventory accuracy. Use Shopify Flow to set up automation rules that trigger an email or SMS to the purchasing team whenever a product’s inventory falls below a set threshold.
- Product bundling. Many customers overlook complementary items during checkout which results in missed upsell opportunities. By applying fixed “buy together” rules, you can guide shoppers toward logical add-ons and boost cart value with minimal effort. Install Shopify Bundles to create your product bundles and customize your bundle product page.
Limited memory AI: Powering personalized shopping experiences
These AI systems have a bit more sophistication than reactive machines. Their basic limited memory can store information about past experiences and use that information to inform their current decisions.
Here are some examples of limited memory AI systems:
- Personalized recommendation engines. They help move beyond generic merchandising and increase average order value (AOV) and overall revenue. If you’re a Shopify merchant, you can activate it by installing the free Search & Discovery app and turning on “Dynamic recommendations,” which update in real time as customers browse.
- Dynamic pricing tools. Respond to demand, customer behavior, and competitor moves. You can implement this by pairing the Shopify Functions API with pricing apps like Prisync to automatically adjust prices on fast-moving items.
- AI-powered fraud detection. Uses machine learning to stay ahead of evolving scams and helps cut chargebacks. You can activate Shopify Protect to defend your online store against fraudulent and unrecognized chargebacks.
- Visual search tools. Make it easier for customers to find what they want by using images instead of text. This can lead to higher conversions for your ecommerce store.
Read more: How Ecommerce Product Recommendations Drive Sales
Theory of mind AI: The future of customer relationships
This type of AI is still conceptual, but it would represent a significant leap in capability. Theory of mind AI would be able to process present-moment data (like facial expressions) to understand the thoughts, intentions, and emotions of others. These emotional learning capabilities would allow the technology to anticipate how others might behave and react accordingly.
Here are some of the concepts theory of mind AI research is building toward:
- Emotion-aware support bots. They can detect tone in a customer’s message and adapt their replies. For example, using a calmer tone or escalating the issue more quickly when a customer is agitated.
- Adaptive storefronts. They might be able to change layout, copy, or visuals based on real-time user behavior. If a shopper slows down while scrolling, the interface might soften colors or simplify layout to reduce friction.
- Predictive replenishment and proactive offers. In the future, this AI type might display timely reorder bundles before customers even search—based on their browsing behavior and past purchases.
- Empathy-driven pricing. It could adjust offers based on emotional cues. If a customer seems frustrated or price-sensitive (based on abandoned carts or chat tone), the system might serve a subtle discount or offer buy now, pay -later options, while skipping the discount for more confident buyers.
Self-aware AI: Theoretical implications for commerce
An even more futuristic concept is self-aware AI that extends beyond the deep learning and machine learning algorithms that power today’s AI systems.
This type of AI wouldn’t simply acquire knowledge and perform complex tasks; it would have consciousness and self-awareness. That means it would understand its own existence and its place in the world—and its place within your business operations.
While self-aware AI is far beyond the capabilities of current AI developments, it’s a concept that philosophers and science fiction writers love to explore.
Practical applications of AI in ecommerce for 2025
Here are some of the most popular, practical AI applications you can implement in your ecommerce business.
Personalization and product recommendations
AI algorithms analyze past purchase history, browsing patterns, demographic data, and even social media interactions to accurately predict and recommend products tailored specifically to individual customers.
For example, Gymshark’s AI recommendation engine shows products based on the interests of similar customers.

Similarly, Amazon also uses AI to display personalized recommendations on each user’s homepage. This can significantly increase conversion rates and customer satisfaction.
If you’re running a Shopify-powered online store, you can use Shopify’s free Search & Discovery app or install third-party tools like Rebuy Personalization Engine and Personalization AI Suggestions to show dynamic product recommendations to your customers.
Dynamic pricing and market analysis
The machine-learning model continuously scrapes competitor prices, tracks sales rate, forecasts demand, and accordingly optimizes the pricing. For example, a consumer-electronics store lowers headphone prices when a key competitor runs a flash sale, then automatically restores margin once demand normalizes.
You can install market-monitoring apps like Prisync or Intelis AI into your Shopify store to implement AI-powered dynamic pricing. These tools track demand and competitor prices, then automatically adjust your pricing.
Customer service and support automation
Chatbots and AI agents answer FAQs, route tickets, and even upsell in any language. For instance, Huel’s digital assistant (chatbot) performs a range of customer support tasks—from answering simple queries to handling complex requests like changing the shipping address or other order amendments.

You can automate basic customer functions like answering quick queries or sending order status updates with Shopify Inbox.
For more advanced business automation, install helpdesk apps like Gorgias or Tidio from the Shopify App Store. These tools offer 24/7 chat, automated ticketing, and self-serve returns by syncing with your Shopify customer and order data.
Read case study: How Wood Wood Toys Uses Shopify Inbox to Differentiate and Win Sales
Inventory and supply chain optimization
AI-based forecasting system predicts demand, creates purchase orders, and selects the best warehouses for order fulfillment. This helps prevent stock-outs and overstocking. For accurate forecasting, it analyzes past sales, seasonal trends, ad calendars, and supplier lead times to recommend what to reorder, how much, and when.
As a starting point, use Shopify Flow to trigger alerts when stock is low and set smart reorder points.
For more advanced forecasting, install apps like Cogsy or Inventory Planner from the Shopify App Store. They can analyze past orders and promo calendars to auto-generate purchase orders synced with your Shopify store.
Fraud detection and prevention
Machine learning models analyze device fingerprints, order velocity, IP addresses, and past fraud patterns to assign each order a risk score. Accordingly, they flag or block suspicious orders.
For example, Shopify Protect’s algorithm uses data gathered from its network and detects various types of fraud. Then it marks the safe orders as “protection active,” so you can confidently fulfill them. This way, you’re protected from potential fraudulent chargebacks, and you can approve more orders and ship more quickly.
Start using AI in your ecommerce store
To simplify AI implementation in your business, treat it like any other growth experiment. Follow these five simple steps to move from curiosity to clear results, without hiring data scientists or rebuilding your tech stack:
- Set one clear goal. For example: “Reduce support tickets by 20%,” “Increase average order value by $40,” or “Eliminate stock-outs.”
- Pick the right AI use case. Need to reduce support load? Try a chatbot. Want to boost cart size? Turn on product recommendations. Facing pricing pressure? Test a dynamic pricing app.
- Start with easy-to-use tools. Begin with Shopify’s built-in features like Search & Discovery, Inbox, or Flow automation. Once you’re comfortable with basic automation, install advanced tools like Rebuy, Prisync, or Signifyd that easily integrate with your Shopify store.
- Run a 30-day test and track one metric. Define the parameters of your test, then measure before and after in Shopify Analytics or the app’s dashboard.
- Optimize and expand. If the results improve your baseline, roll out the feature to more pages or products, or upgrade your plan. If not, tweak your approach or try another use case.
Start small, learn fast, and build on your wins. Each improvement gives you better data, more confidence, and the momentum to take on bigger opportunities.
Types of AI FAQ
What type of AI is ChatGPT?
ChatGPT is a form of narrow AI, specifically falling under the category of conversational AI, capable of generating human-like text-based responses within a predefined scope. You can also describe it as generative AI.
What are the 7 types of AI?
AI is often grouped by capability and functionality, creating these seven categories:
- Narrow AI
- Artificial general intelligence (AGI)
- Artificial superintelligence (ASI)
- Reactive AI
- Limited-memory AI
- Theory-of-mind AI
- Self-aware AI
How can small businesses benefit from AI in ecommerce?
Small ecommerce business owners can use AI to:
- Automate basic customer support functions
- Display personalized product recommendations to drive sales
- Automatically adjust prices and promotions
- Forecast inventory needs so cash isn’t tied up in unsold products
What’s the ROI of implementing AI in an online store?
The ROI of implementing AI in ecommerce depends on the use case. However, AI can contribute to your ROI in multiple ways such as:
- Boosting revenue by tailoring offers to each shopper
- Cutting costs by automating tasks like support, pricing updates, and fraud checks
- Optimizing inventory management to prevent overstocking or stockouts
What is the most common type of AI used today in ecommerce?
Narrow and limited-memory AI are the most common types of AI that power product recommendations, dynamic search, fraud detection, and email/SMS segmentation in ecommerce. These models learn from past behavior and are easy to add to your Shopify store through built-in tools or partner apps.