AI: The next stage in automotive retail?
You’d have been hard-pressed to have missed all the noise around artificial intelligence (AI) in recent months, with new developments and use cases hitting the headlines in rapid succession. But how is AI already in use in the automotive sector and what applications could it have for retailers?
What is AI?
AI can be defined as applying novel methods to solve complex and difficult tasks in ways that appear” intelligent” or human-like. It requires a huge amount of data and computing power to develop such systems, with recent developments in these areas enabling AI to tackle a wider range of problems.
The recent spike in interest can largely be attributed to the success of ChatGPT which took the world by storm when it launched late last year and went viral across social media. ChatGPT, a generative AI, allows users to enter a prompt and receive AI-generated responses in the form of AI-generated text, videos, and images. You can think of it as a development of the chatbots that you may already have on your websites and that we have on Auto Trader, but one that has far more advanced, human-like responses to your questions.
But this explosion in interest masks the fact that AI has been around for quite some time.
How does Auto Trader use AI?
We’ve been working with AI for almost a decade now. Our in-house data science team is constantly developing our data sets using the behaviours we observe from the 60 million cross-platform visits. These data sets are used to develop AI products and functions that improve the retailer and consumer experience on our platform. In fact, you’ve mostly interacted with some of our AI products already, with tools such as our retail valuations and advert attractiveness scoring all based on AI. Even our onsite recommendations to consumers are powered by an AI model so we really are embracing AI as a tool to improve the buyer and retailer experience on our platform.
Image of AI functionality on site
Want to find out more about how we’re utilising AI? Then check out our most recent webinar which you can now watch on demand.
Click here to check out the webinar
What impact will AI have on automotive retail?
We’re already seeing AI being used in a number of ways by both consumers and retailers in the car buying journey, with AI assisting buyers with recommendations and retailers with their stocking decisions through the use of valuations and days to sell data.
As AI tools develop so will their uses. As you can see, there are plenty of ways in which AI can be used in automotive retail, from pricing to writing vehicle descriptions, and there are now more AI tools available to you than ever that you can use to streamline some of the processes you have in place. Whilst it’s certainly worth exploring how you can utilise AI in your business (and how you can utilise the systems we have in place for you), it’s worth remembering that many of these tools are relatively new and can’t compete with the human touch…yet.
Looking into the not-so-distant future, AI will streamline many processes in retail and with that comes the question of whether there will be an impact on jobs. We expect the impact will be very similar to when we’ve seen other technologies come to the fore. The proliferation of the PC caused some jobs to become obsolete, but rather than a mass of job losses, we saw people’s roles expand to adapt to this new technology (think typists moving to data entry) and new roles being created around the technology. We can expect the same thing as the use of AI becomes more widespread.
It's hard to know exactly what the future holds for AI but, barring any rogue AI movie plots becoming a reality, we see AI as a tool that will continue to help both consumers and retailers in the car buying journey, with AI helping to realise a future automotive retail sector with data-driven decisions and human experiences at its core.
