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What is Artificial Intelligence, and How Does it Impact Your Point-of-Sale?

What is Artificial Intelligence, and How Does it Impact Your Point-of-Sale?

Artificial Intelligence and human intelligence coming together.

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When people hear the term “artificial intelligence” (AI), it might conjure images of futuristic androids or sentient computers from movies such as I, Robot or AI. But while those things are still in the realm of science fiction, AI has become increasingly engrained in the modern technology we now use every day, from our smartphones to our point-of-sale (POS) systems. AI helps consumers and workers streamline their activities and increase productivity.

But what is artificial intelligence? The Oxford English Dictionary defines AI as “the development of computer systems able to perform tasks that normally require human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages.”

Before AI began to appear in retail technology, large-scale monitoring of employees, inventories, transactions, customer purchase histories, or sales was next to impossible due to limited data management and analysis capabilities. Now, your POS system can incorporate AI to generate smart reports and optimize your data into actionable insights.

Person doing data analysis at their laptop computer.

Those insights may give you a potent competitive edge. In the recent results of 2022’s McKinsey Global Survey on AI revealed that the number of businesses using AI technologies since 2017 has more than doubled. On top of that, the companies that use AI for marketing and other purposes consistently outperform those that do not.

In fact, a recent blog posted by Techjury revealed that the AI market is projected to grow at CAGR of 38.0% from 2021 to 2030, and that 77% of the devices we already use feature one form of AI or another.  

By integrating AI into day-to-day operations, companies can:

  • Boost efficiency by spending less time sifting through vast streams of data from a variety of disparate sources
  • Focus on what really matters for their business
  • Speed up time to action


So, what is artificial intelligence in the context of POS technology, and what does it look like for merchants?

AI Combines and Analyzes POS Data with Real-Time Reports

AI and POS software work together to create continuous intelligence. According to the Gartner Glossary of Information Technology, continuous intelligence is “a design pattern in which real-time analytics are integrated into business operations, processing current and historical data to prescribe actions in response to business moments and other events.” It provides decision automation or decision support.

AI technology and data analysis helping a cafe business owner.

This intelligence involves a variety of technologies, such as machine learning, event stream processing, optimization, and business rule management. Some of the technologies that can help generate better real-time data include:

  • Facial Recognition: This technology can generate customer profiles, enhance security, track behaviors, and make specific suggestions that improve sales by providing a personalized experience.
  • IoT-Enabled Sensors: The Internet of Things (IoT) enables communication and data exchange between objects with computer devices connected to the Internet. A smart POS system can utilize electronic shelf labels to track user behavior, update inventory, and complete transactions anywhere in the store through connected sensors. This function prevents long queues with smart scan technology during peak hours or end-of-season sales (EOSS). It also automatically alerts the inventory manager when items are nearly out of stock, prompting timely reorders and preventing disappointed customers.


With these AI technologies paired with traditional POS reports, merchants can take their data strategy to the next level by leveraging predictive analytics to enhance their insights into inventory management, customer marketing, and sales, creating actionable plans.

AI-Based POS Reports Create Actionable SMART Insights

With more advanced, AI-based reports, you can create SMART (Specific, Measurable, Attainable, Realistic, and Timely) goals and actionable plans. These reports provide managers and owners with information that uncovers deeper insights.  

You can take it a step further with AI power that makes recommendations for you. Some AI programs give you insights and suggest the best responses. 

Leverage smart insights to discover shopping patterns and preferences, which you can turn into successful sales strategies. For example, the information you gain can help you decide which products to place near each other and where to position the best or most profitable items for higher sales based on buyer behavior reports and foot-traffic heat maps.

AI point-of-sale for QSRs and restaurants.

Other SMART insights might assist with decisions and strategies, such as:

  • Generating loyalty programs for preferred customers who visit your store regularly
  • Placing additional staff in new locations for customer support
  • Creating electronic displays that change using facial recognition to show products and promotions tailored to a recognized customer’s profile

Optimize Your Business Operations with AI POS Software

Once you have SMART insights and create strategic responses, watch as your operations speed up and become more optimized. You’ll use your reports to take action to eliminate long checkout lines, reduce stock-outs, and enhance the customer experience in-store and online.

Your actions will bring:

  • More efficient workflows that eliminate redundancies
  • Streamlined stocking and other in-store maintenance
  • Automation of previously manual, tedious processes, freeing your staff to devote more attention to customers


So, what is artificial intelligence when paired with POS solutions? It’s the key to true business intelligence.

Data analysis and AI technology for business.

Get Your AI from a Smart Provider

AI is readily available to merchants ready to invest in their businesses, streamline their processes, and take control of their data. It starts with understanding which AI technology is best for your business needs, gathering and analyzing your data to generate actionable insights, then optimizing your operations.

Get everything you need to utilize AI with your POS system from your trusted POS hardware provider. Star Micronics has been dedicated to innovation for more than five decades. To learn about the latest POS hardware options to improve your business, contact us today.

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