When OpenAI released ChatGPT, it transformed artificial intelligence (AI) from a specialized technology into an accessible tool. With 78% of companies using AI in their businesses already, its rapid growth has had a huge impact on virtually every industry—including ecommerce.
Businesses are increasingly turning to artificial intelligence to develop a competitive advantage in a market where customer expectations are higher than ever.
AI provides a powerful solution for online merchants whose success depends on converting visitors into consumers. Here’s how to implement AI conversion rate optimization to help you increase conversions and grow your business.
What is AI conversion rate optimization?
AI conversion rate optimization (CRO) is the use of artificial intelligence to increase your conversion rate, or the percentage of potential customers who take a desired action on your site like buying a product or signing up for a newsletter.
Artificial intelligence CRO uses advanced algorithms and machine learning to analyze vast amounts of data about how users interact with your website or campaign, including how long they spend on your site, what they click on, and what they buy.
They keep learning with every customer interaction, so testing gets more accurate every time. For example, Shopify Sidekick, a generative AI assistant built into the Shopify platform, can suggest CRO improvements based on real-time store data, so you can optimize without needing a full marketing team.
Benefits of using AI for conversion rate optimization
Here are some benefits of using AI tools for conversion optimization:
Saves money
AI-powered targeting, budget re-allocation, and look-alike modeling can drive customer acquisition costs down compared to traditional campaigns. For example, with Shopify Audiences, you can get your ads in front of high-intent buyers and slash CAC by up to 50% with algorithms that constantly improve.
AI tools like Shopify Magic can also automate some of the creative process. Generative models can now write on-brand headlines and product copy on the fly, so businesses can test different creative angles without spending too much time and money.
Implementing AI systems may require an initial investment, but the long-term benefits include substantial savings.
Increases efficiency
A study from the Federal Reserve Bank of St. Louis found that workers are saving between 1 and 4 hours per week with gen AI. For a three-person team, that's around 49 reclaimed working days each year. Time that can be spent on creative strategy and planning.
AI tools can also process and analyze data at an incredible speed, allowing for immediate adjustments to your content strategy. For example, a retailer using AI for website optimization might automatically feature a trending product on its homepage after AI detects a spike in interest.
Scales CRO efforts and personalization
Segment's 2024 State of Personalization report found that 89% of leaders believe personalization is crucial to their business's success in the next three years. Some 57% also believe AI-driven customer journeys will be the most impactful technology in coming years.
AI can create personalized shopping experiences at scale that no human team can match. Take Misfits Markets. Its auto-cart feature uses predictive models to drop likely buys straight into each shopper's basket, then lets customers fine-tune with a single click. According to McKinsey, these personalized touches can lift revenue by anywhere from 5% to 15%.
3 ways to use AI to increase conversion rates
Here are three ways to use AI to improve your conversion rates:
1. Automated A/B testing
A/B testing, or split testing, is a tried and true method to boost conversion rates that AI has made even more effective. This approach involves comparing two versions of your website content or landing pages to see which version produces better results. AI tools can accelerate the conversion optimization process by showing site visitors different variations of button colors, headline copy, and calls to action (CTA) in real time. As users interact with your content, AI systems can quickly spot high-performing elements that lead to higher conversion rates, and implement them sitewide.
A notable example of AI-powered A/B testing is Netflix’s content recommendations. Netflix constantly runs tests on its home feed to determine which design elements lead to higher user engagement, helping Netflix retain customers.
To start automated A/B testing, identify the areas where you think you may be losing customers, like your homepage, product pages, or the checkout process. Platforms like Google Analytics can provide data on key performance indicators (KPIs) like cart abandonment and bounce rates to help you pinpoint these drop-off points. Then, use an
2. Customer service chatbots
AI-powered customer service chatbots can enhance customer engagement and improve your website’s conversion rate. With prompt, 24/7 support, AI chatbots can boost customer satisfaction and reduce the likelihood that potential customers leave your site without taking an action. Try platforms like Tidio and Willdesk to integrate chatbots into your website or online store.
Unlike chatbots of the past, which used pre-programmed responses, AI chatbots understand natural language and complex requests, making interactions with customers more personal and human-like. They also collect data and learn from interactions to provide personalized experiences.
3. Hyper-personalization
Hyper-personalization is one of the most talked about AI-driven CRO methods—and for good reason. This conversion rate optimization technique can boost conversion rates by helping market to customers on an incredibly personal and granular level. Before AI marketing tools, marketing teams personalized content through customer segmentation—splitting customers into groups based on common traits like age or interests to market to them separately. However, segmentation often lacks precision and can lead to messaging that feels generic.
Hyper-personalization, on the other hand, creates highly targeted experiences based on user behavior, purchase history, and even their interactions with your social media accounts. This lets you customize product recommendations and content to speak directly to each customer’s needs and preferences. For example, imagine a customer browsing your online clothing store.
With hyper-personalization, the AI system can track their past purchases and browsing history so that when they return to the site, they’re immediately shown product recommendations that match their style preferences.
By making customers feel understood and valued, hyper-personalization not only increases conversions but builds lasting customer loyalty and boosts customer lifetime value (CLV)—the total revenue you can expect to generate from a customer throughout their relationship with your business.
Best AI CRO tools
AI-powered CRO can only be done with the right tools. Here are six of the best options that will capture behavior data and turn it into actionable insights.
A/B testing and UX
- Intelligems. Split test content, landing pages, UX, product prices, shipping thresholds, and more with a few clicks. Offers an easy setup and support for headless stores. 7-day free trial available.
- Shoplift. Lift Assist auto-creates branded, pixel-perfect A/B tests without any coding. Get access to predictive analysis, device segmentation, and support for local currency and time zones. 14-day free trial available.
Personalization engines
- LimeSpot. Set up AI-driven "Frequently Bought Together", smart bundles, and cross-channel (web, email, SMS) recommendations in minutes. Free version available. Paid plans start at $6.99 per month.
- Nosto. A complete commerce experience platform powered by your store data. Increase customer engagement with site search, personalization, merchandising, and business intelligence tools with one app. Free to install.
Predictive analytics
- Lucky Orange. See what people click and browse on your website with session recordings and heatmaps. Learn where they drop off in the purchasing journey with detailed analytics and boost conversion rates. Free plan for up to 100 sessions per month. Paid plans start at $19 per month.
- Microsoft Clarity Copilot. Get free predictive heatmaps that forecast click patterns on pages. Free to use.
AI conversion rate optimization FAQ
What is an example of AI conversion rate optimization?
An example of AI conversion rate optimization (CRO) is using Shopify Sidekick to identify and fix drop-off points in your sales funnel. If Sidekick detects that many visitors are abandoning their carts after viewing shipping rates, it might suggest adding a free shipping banner, simplifying the checkout process, or adjusting product page messaging, all based on store data. Over time, its recommendations improve as it learns from your customer interactions.
What is the difference between AI and traditional conversion rate optimization?
Traditional conversion rate optimization relies on manual testing and human analysis to increase conversions and drive sales. This approach is time-consuming and not tailored to individual customers. AI conversion rate optimization uses artificial intelligence to analyze huge quantities of data points and test multiple variables simultaneously, continuously learning from what it finds.
How do you use AI for conversion rate optimization?
Business owners can get started with AI conversion rate optimization by using tools like Google Analytics to assess the current performance of their marketing strategies. Once you have an understanding of your baseline, consider incorporating A/B testing tools to improve website performance, implementing AI chatbots to improve customer engagement, and incorporating AI personalization techniques to customize user experiences.
