IBM Adds Cognitive Capabilities to Commerce Solutions

At its Amplify 2016 e-commerce conference, IBM introduced new cloud and cognitive technologies that personalize customer interactions.

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IBM continues to deliver on its pledge to infuse its products with cognitive technology, as Big Blue works to turn both itself and its customers into cognitive businesses.

At its Amplify 2016 conference in Tampa, Fla., IBM announced new and expanded solutions and features including cognitive technologies that enable companies to deliver personalized customer experiences.

By infusing cognitive technologies into its marketing, sales and analytics tools, IBM is helping companies deliver end-to-end customer experiences, as the cognitive tools are able to understand, reason and learn about customers over time to better meet their needs.

IBM upgraded its Real-Time Personalization, which uses cognitive technology to help marketers deliver the right message to customers. The product's Cognitive Rule Advisor understands that customers' preferences change over time, so it learns their preferences and suggests the message and offer that should be shared with each visitor. The tool, part of the IBM Marketing Cloud, then analyzes which segments are responding best to each message. It employs self-learning algorithms and analytics to fine-tune the experiences over time.

IBM's goal with its cognitive technology is to help customers make better, more informed decisions. The IBM tools help marketers and merchandisers learn, predict and guide customer engagement.

"Every customer is unique and has little tolerance for businesses that fail to recognize their specific interests, wants and needs," said Harriet Green, general manager of Watson IoT, Commerce and Education at IBM, in a statement. "Today we continue to invest in building our portfolio which includes new cognitive solutions that will help completely transform how companies serve each customer. Businesses will be able to quickly understand, reason and learn from every customer interaction—and put that knowledge to use to uncover new opportunities from insights."

The marketing segment has been an early adopter of analytics and cognitive technology.

The argument for cognitive functions and capabilities relates to the direction in which commerce and marketing are inexorably heading, where the ability to engage clients in real time and to personalize those engagements according to the needs of individual customers will become commonplace, said Charles King, principal analyst at Pund-IT.

"Achieving those ends with powerful analytics solutions is clearly possible. But the ability of cognitive technologies to understand, reason, learn and provide expert in-the-moment advice and recommendations that evolve over time should make it an invaluable resource for IBM clients," King said.

According to a new Nucleus Research study, IBM delivers $15.82 return on investment (ROI) for every dollar spent on its marketing, sales, merchandising and analytics offerings.

"Our analysis of increasing returns on the dollar for IBM customers is both based on lower initial costs and the ability to get greater value over time from a greater move toward cloud and less integration and customization effort—and the lower ongoing TCO associated with more turnkey applications," Rebecca Wetteman, vice president of Nucleus Research, told eWEEK.

IBM also announced new cognitive technologies in Commerce Insights, which provides merchandisers with a real-time view of their business, specifically focused on how products and categories are performing. IBM gave the tool a cognitive boost with category sequencing capabilities so that it automatically places products on a Web page based on current demand and inventory and adapts the sequencing as sales and inventory levels change.

Big Blue also added cognitive capabilities into the Commerce Insights anomaly detection system to automatically alert users to significant spikes and dips in sales. It looks at contributing factors such as inventory, promotional events and channel activities, and will soon take social sentiment and competitive pricing into account.

"IBM has had best-of-breed capabilities for predictive and advanced analytics for a long time—with the SPSS, Cognos, Coremetrix, and other acquisitions," Wetteman said. "They also have the building blocks for better integration. The company's announcements show continued investment in making overall CX projects for customers more digestible."

Moreover, IBM recognizes that most customers have already made some investments in best-of-breed applications for marketing and other customer interactions, Wetteman continued. "These announcements show they recognize that digital transformation, to be successful, has to be phased and self-funding without ripping out what smaller deployments are already working," she said.

Meanwhile, a key component of the IBM Commerce portfolio, WebSphere Commerce, recently celebrated its 20th anniversary. WebSphere Commerce is the engine behind more than 12,000 storefronts for retailers such as 1-800-Flowers and Carhartt.

Other components such as IBM Customer Experience Analytics integrates IBM's Tealeaf digital customer experience management and customer behavior analysis solutions with Journey Analytics, Digital Analytics and customer behavior analytics capabilities. IBM Performance Insights monitors a marketing campaign's effectiveness in real time, alerts users when a campaign is not working and provides insight as to why. And IBM's Universal Behavior Exchange (UBX) is an open exchange that makes it easy to share customer data between certified solutions, bypassing the custom IT work typically required to launch a personalized campaign.

"We're still in early days with the application of cognitive technologies, and the final destination is not entirely clear," King said. "But these newest solutions suggest that IBM's cognitive plans and strategies are clearly on the right track."