Retailers in South Africa have made changes to help you make the best choice, but they need to be careful

Retailers are increasingly using artificial intelligence tools to identify patterns and provide insights into shopping habits and improved consumer experiences.

However, these stores could be in trouble if they do not comply with existing laws when implementing AI technology, says Wendy Tembedza, partner at Webber Wentzel.

How stores are using AI

An example of AI in retail can be seen in the use of facial and voice recognition. SPD Group, a London-based e-commerce solutions company, has developed a product suggestion system based on tracking a shopper’s location and in-store activities. The system analyzes video recordings from cameras, identifies buyers by frames and tracks the location of the buyer in the store.

Walmart Tesco and many other well-known retail brands are using Google or Amazon artificial intelligence technology to provide customers with a simple and fast voice search. For example, Walmart and Google’s implementation of Walmart Voice Over allows customers to simply say “Hey Google, talk to Walmart and add milk to my cart” to their Google Assistant.

The specific milk that the customer buys regularly is then automatically added to the customer’s online shopping cart.

Retailers are also using artificial intelligence in virtual fitting rooms, allowing shoppers to find the perfect outfit and save time. Me-Acity’s virtual fitting kiosk can scan a customer in 20 seconds and measure 200,000 body points in that time. Companies such as Levi’s and Gap have installed these scanners in select stores and have seen marked increases in sales as a result.

Locally, Superbalist.com recently launched Fit Finder, the first South African retailer to do so. Consumers know all too well that some brands don’t always fit true to size.

The Fit Finder, developed by Fit Analytics GmbH, is an intuitive tool that helps online shoppers make accurate sizing by answering a series of questions related to size and brand. The Fit Finder then uses the responses as well as sales and returns records to suggest the correct size.

concern

The viability of AI-powered consumerism depends on the ability of retailers to show they can handle personal data responsibly, Tembedza said.

“While the use of AI creates opportunities for retailers, the deployment of any AI tool in the retail context in South Africa must be carefully reviewed for compliance with data protection laws.

The artificial intelligence tools must be set up and operate in such a way that they assist the retailer in meeting their obligations under the Personal Information Protection Act 4 of 2013 (POPIA). For example, the use of AI for face recognition complies with POPIA’s personal information requirements.”

Retailers need to be sure that the tool they choose includes the appropriate controls to reduce the risk of unauthorized access to relevant data, she said.

Tembedza said retailers should also be aware of the implications of Cybercrime Act 19 of 2020 (Cybercrime Act) on their operations.

“AI requires access to huge amounts of data, which leads to an increased risk of cybercrime. Cybersecurity is a prerequisite and a means of processing AI. It is good practice for retailers to take measures to reduce the risk of committing an offense under the Cybercrime Act, such as measures to prevent illegal access to or interception of data.

“Of course, retailers need to be aware of the reputational implications of failing to take action to protect against identified cybercrime, and need to understand that their AI tools need to be configured to facilitate this protection.” This has a significant positive impact on how retailers deliver a personalized customer experience, she says.

“It has been shown that this experience can result in retailers not only retaining their existing customer base but also acquiring new customers. However, when implementing AI, retailers should be mindful of their obligations under POPIA and the Cybercrime Act.”


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