Most advertisers by now have heard of artificial intelligence (AI), but few have felt the full extent of its repercussions.

Overhead expenses are enormous — approximately $694,000 per day for computer-hardware costs, or 36 cents per query, to keep a chatbot up and running, according to one estimate.

In a beta project, Bloomreach has attempted to remove the high costs from implementation, giving retailers and brands with a position in ecommerce benefits that will far exceed others using this disruptive technology.

Bloomreach, which supports ecommerce companies through technology, recently joined Shopify and Alibaba in launching its own conversational AI shopping assistant, Clarity.

A handful of retailers are working with Clarity, Bloomreach’s white label shopping assistant. This part of the online solution enables companies to give it their own identity to deliver a personal experience.

“OpenAI has allowed businesses to train their own algorithm to see the benefits of the technology without having technical expertise,” said Bloomreach CMO Amanda Cole.

This ability spurred a whole bunch of ideas for retailers to better engage customers, similar to the way they do in physical stores. Companies wanted to give customers “highly personal” shopping assistants and experts that they could not replicate online.

About 51% of marketers cite personalization as their top priority, according to Gartner data, but many efforts are failing, with 80% of marketers saying they will abandon personalization efforts by 2025.

“Highly personal shopping experiences” has been a buzz phrase for years. Now it has become clear what it means — especially for those consumers who still do not have the confidence to buy online.

These consumers want to touch, feel and see the items through their purchase. They want more information about the warranty or how to return the product, and do not know how to find it on the website. They want to talk with an expert before making the purchase.

Total Wine, one of the 15 early testers of Bloomreach’s Clarity, wanted to help consumers purchase the perfect bottle of wine for them without the frustration. The AI model provides expertise when trying to decide what wines to purchase. About 70 companies are on the list to join the beta program.

Cole said Bloomreach will wait until early next year to make the product generally available to all.

Retailers do not want to try new technology during the holiday season. They freeze changing any type of code in platforms by the middle of September, and lock down A/B testing until the new year. They also want to keep down costs.

“This type of technology is very expensive,” she said. “We need to ensure we provide real benefit and not just another cool thing.”

The OpenAI calls — not what Bloomreach will charge, but what companies will need to pay to run the AI chat technology — are very expensive. To lower costs, open-source technology has been released to lower costs.

Earlier this year, analysts and technologists estimated the process of training a large language model such as GPT-3 could cost more than $4 million.

Latitude in 2021 spent nearly $200,000 a month on OpenAI’s generative AI software and Amazon Web Services to keep up with the millions of user queries it needed to process each day for its AI Dungeon game.

Bloomreach also recently integrated its marketing automation platform with TikTok, adding to its connections with Facebook Conversions API, Snapchat, motionform, Facebook Ads, AdForm, Facebook Lead Ads, Google Ads, and Google Double Click. 

“The average time spent on TikTok is about 52 minutes, compared with 28 minutes on Instagram,” she said. “But TikTok really struggles on the ad-revenue side. I really think it’s because they focus on the user and user behavior.”

When advertisers are not very specific about who they engage with a high level of personalization, they miss the boat. Bloomreach’s integration with TikTok enables advertisers to stream audiences directly into the TikTok ad platform — a bi-directional integration.

“If an audience is not likely to convert on a channel, the platform won’t add it, so advertisers don’t waste money,” Cole said.

Most advertisers by now have heard of artificial intelligence (AI), but few have felt the full extent of its repercussions. Overhead expenses are enormous, approximately $ 694,000 per day for compute-hardware costs, or 36 cents per query, to keep a chatbot up and running, according to one estimate.