Eye on AI - January 17th, 2020
Welcome to Aigora's "Eye on AI" series, where we round up exciting news at the intersection of consumer science and artificial intelligence!
This week, we turn back to the impact of robotics and AI on retail, beginning with new cost-reducing chatbot and robotics grocery store implementations, then transitioning to Walmart’s continued evolution into a tech company. Buckle up, folks – lots of news this week!
Chatbot Personalization Localizes Inventory at Traditional Grocery Chain
We open this week with The Drum Marketing Awards, and their article “Inside the Finnish retailer bringing real personalization to bricks-and-mortar stores”, which highlights an innovative new chatbot-based marketing strategy by Finland’s S-Group, the largest Finland-based grocery chain, that gives local communities the power to help drive individual corner-store inventory.
The issue S-Group was having was that its corner stores, called Alephas, were traditionally stocked with almost identical inventory regardless of location. Sales were stagnant. Product performance varied based on location.
“To tackle this issue, we introduced ‘Alepa Block Wishes’ – a hyperlocal digital initiative and a logistics and production-line turnaround,” writes S-Group. “With the help of a chatbot, customers could request their favorite products to be added on the shelves of their local Alepa straight from their mobile phones Messenger app.”
Soon after implementation, each individual corner store’s inventory transitioned to coincide with the needs of the community, leading to better inventory and higher profits.
“Customers could wish any products they imagined from the bot, which then searched matching product from S Group databases using meta data and returned best matching products within milliseconds to the chat,” continues the article.. “ In a time of retail revolution, the previously prehistoric Alepa store chain managed to evolve into a network of corner stores to hip local shops with unique selections.”
The strategy was so effective, it won The Drum’s 2019 ‘New Product or Service Launch Strategy of the Year’. It’s an ingenious use of the chatbot, one that could help solve inventory problems at chain stores across the world.
Robots Are Taking Over Grocery Store Chains
We continue with a complimentary article out of AI&IoT Daily, titled “NRF 2020: Robots, Connected Shelves, Facial Recognition,” which highlights new grocery tech unveiled this week at the National Retail Federation Big Show in New York.
“As in past shows, there were robots that scanned the aisles checking inventory, all kinds of connected shelving and the promotion of various levels of artificial intelligence within products,” writes MediaPost’s Chuck Martin. “Numerous displays on the expo floor included cameras using facial recognition software to locate and categorize shoppers, primarily by demographics.”
Numerous self-checkout solutions were introduced, including checkout robots, and facial-recognition cameras that would help personalize the shopping experience. As more facial-recognition cameras are implemented at grocery chains, I’m curious to see if they act as a shopper deterrent, or if shoppers will be so desensitized to cameras that they’ll prefer the personalization they offer.
Walmart Adds New Tech, Furthering its Transition into a Tech Company
We conclude this week with the Bloomberg article “Walmart Expands Its Robotic Workforce to 650 Additional Stores”, which highlights Walmart’s recently implemented fleet of self-scanning robots it hopes will heavily reduce stocking costs.
“The new robots, designed by San Francisco-based Bossa Nova Robotics Inc., join the ranks of Walmart’s increasingly automated workforce which also includes devices to scrub floors, unload trucks and gather online-grocery orders,” writes Bloomberg reporter Matthew Boyle. “They’re part of Chief Executive Officer Doug McMillon’s push to reduce costs, improve store performance and gain credibility as a technology innovator as it battles Amazon.com Inc.”
Not everyone is excited about the robots. Many are calling them ‘job stealers,’ and with good reason: a recent report from McKinsey & Co. found that about half of all retail activities can be automated with existing technology. Walmart’s other announcement this week, “Walmart Unveils Grocery-Picking Robot”, did little to assuage those fears.
Tech innovations can be highly beneficial if used in the right ways. Only time will tell how this all plays out.
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