Amazon is prioritizing usage artificial intelligence (AI) to improve delivery speed by reducing the distance between products and customers.
Speech Speaking to CNBC on May 15, Stefano Perego, Amazon's vice president of global operations and customer fulfillment services for North America and Europe, said artificial intelligence plays a role in various aspects of Amazon's operations. This includes the use of AI for transportation, such as route mapping and planning, and consideration of factors such as weather conditions. Also, AI helps customers find desired products when they search Amazon.
Amazon is currently prioritizing AI to optimize its inventory. Perego emphasized the importance of inventory location as a crucial area in reducing the cost of service delivery:
โImagine how complex the problem is of deciding where to put that unit of inventory. And place it in a way that we reduce the distance to meet customers and increase the speed of delivery.โ
Amazon has been prioritizing its "regionalization" initiative, which aims to deliver products to customers from nearby warehouses rather than distant locations. However, achieving this goal requires advanced technology to analyze data and patterns to anticipate product demand and determine optimal inventory placement.
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AI plays a crucial role in achieving this goal. By strategically placing products closer to customers, Amazon can facilitate same-day or next-day deliveries, similar to its Prime subscription service. According to Perego, the company's efforts in this regard have been successful, with more than 74% of US customer orders being filled from nearby distribution centers.
On April 13, Amazon announced the release of Bedrock, an artificial intelligence model that will allow users of Amazon Web Services to develop generative AI from basic models.
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