Tag Archives for " retail technology "

man holding the smart phone, using the Augmented Reality buy some food in the supermarket

Augmented Reality v/s Image Recognition – The better bet for your business

Augmented Reality vs. Image Recognition - The better bet for your retail business

There's a lot of chatter around how Augmented Reality will change the way people shop. While Augmented Reality holds value, every technology created has its specific use case. Retailers and brands must bear in mind the several aspects each of the technology provides and select those that align to their objectives and goals. Let's delve deeper into each of these technologies -

Image recognition

Image recognition technology enables consumers to search for products by just taking a picture of them. These visual experiences are usually more flexible in nature when compared to Augmented Reality experiences for the following reasons -

No requirement for users to download an extension or app 

While there are some versions of AR applications out there for mobile websites, it's still a long way from delivering a seamless experience for its users. AR experiences that perform well often require a user to download an app. Image recognition, here plays a pivotal role as it enables interactive experiences within a retailer's mobile web, and not just the native app.

There is no need for creating 3D models 

Developing 3D models for AR experiences can often be time-consuming and expensive. Due to its complicated nature, it even requires technical skills to deliver the experience. Image recognition can be used with the existing marketing and web collaterals and can be implemented with ease. Moreover, the changes made to the content will automatically be updated in the apps, keeping the experience up-to-date.

Providing a universal and inclusive experience for shoppers 

Devices play an important role when Augmented reality is concerned. The experience may differ between low-end and high-end user devices, with the highest quality devices getting the best results. This is not an issue with Image recognition as it allows brands and retailers to ensure that their content is delivered to their customers in the same, interactive manner, irrespective of the user's device.


Limitations of Image recognition vs AR

While Image recognition provides the aforementioned benefits, there are certain aspects that set Augmented Reality apart from Image recognition:

Content is visualized in a three-dimensional manner

The type of content linked to Image recognition often includes videos, promotions, product information pages, etc. which often aids the customer's purchase journey by allowing them to learn more about the products and it offers at one go. In AR, the content is represented in a three-dimensional format. The content visualized is not three-dimensional, unlike what many Augmented Reality experiences build upon.

Image recognition provides a transactional experience, not immersive

If a user/customer aims to visualize objects in their environment, Augmented reality can be a good option to choose from, as Image recognition limits the user or customer to place digital content into the real world. This comes especially handy while buying expensive furniture - with a 'try before you buy' functionality. The customer can use the functionality and get a feel of how it may appear against a realistic setup - and nudge him or her towards a purchase.


Conclusion

To put it briefly, image recognition helps create a smooth transition between the physical and the digital worlds and help customers through a shopping journey. It allows them to interact with real products with the help of the images and the product information. For instance, it allows the user to learn more about a product's nutritional values, the user ratings, allergens, check for its alternatives, similar products, complementary products, etc.

On the other hand, Augmented Reality goes from digital to physical. It lets customers interact with virtual products in their own environment when, in fact, are not present.

While they may support different use cases, both technologies can provide customers with different kinds of engaging experiences.

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Social Media: A New Way to Shop Online

Social Media: A New Way to Shop Online

 E-commerce has changed the way people shop, giving retailers and businesses new avenues to interact and engage their customers. Millennials are currently the most valuable target demographic for modern retailers. As they are also the most avid users of social media, a crossover was all but inevitable.  

Retailers, realizing the power of social media, have used these platforms for a while now to engage with their customers online. Social media also lets retailers market their products in a more interactive environment.

Recently, social media platforms like Instagram and Facebook have been investing in retail. This captures wide consumer interest and boosts both revenues as well as followers. As for retailers, they can use social media platforms to better understand consumer behavior and trends.

UGC or user-generated content is one of the most valuable data sources for retailers. Millennials put a lot of trust and faith in peer evaluation of products. Studies show that reviews and recommendations by fellow shoppers, rather than brand messaging, motivate customers to buy products online.

Here are a few instances of how social media platforms are leveraging the retail space:

Facebook Shop and Marketplace

Facebook has a feature called Facebook Shop. Retailers can add the Shop tab to their business page. It lets retailers display their products and sell directly from their company page itself. Considering the huge number of users on Facebook, this offers retailers a wide audience to convert into customers. Retailers can upload a product catalog to their page and customers can browse the products and buy them without having to leave the page. It also allows retailers to manage orders, and mark them as shipped or canceled right on the page itself.

Facebook also introduced Facebook Marketplace, an online market for retailers to display products. This offers free organic distribution for retailers’ products. It curates content and provides product recommendations based on user preferences and relevance. This ensures higher conversion from a user to a consumer. Like Facebook Shop, there is no listing fee involved. It is an online platform for retailers to sell to their customers.

#Instashopping on Instagram

Instagram is one of the most popular social media platforms with more than 1 billion active users; and about 60% or a whopping 600 million people, seek out and discover products on the app. Instagram has introduced shoppable posts which allow customers to go from discovery to buying without having to leave the app. Retailers can add up to 5 product tags per picture on business accounts only. They can only tag products from their Facebook Shop catalog. These tags redirect the customers to a product page that allows them to buy the products.

This seamless and hassle-free shopping experience has a wide appeal for the customers. In June 2018, they added Shoppable Stories which are an added advantage as about 400 million users view Stories every month. As of late 2018, Instagram also added a shopping channel to the Explore page, which is in its testing phase.

Shop and Cop by Snapchat

Snapchat  has introduced ads and product catalogs through its self-service ad buying platform. Recently, they released a dedicated shopping channel called Shop and Cop on the app which will feature exclusive offers and limited time deals through Shopify. These channels will be available in the Discovery section of the Snapchat app. Shop and Cop will feature social influencer posts and content. Shopify capabilities will allow in-app purchases ensuring a smooth shopping experience without the user leaving the app. Snapchat will curate products while Shopify will take care of the buying end. Moreover, Snapchat and Amazon have announced a partnership on a visual search tool. This will allow customers to use the Snapchat camera to search for products on Amazon.



2018 saw a lot of innovations with social media intersecting with e-commerce to give the rise of social commerce.  Retailers stand to make big bucks off of these popular platforms by better understanding shopper purchase behavior and using it to their advantage. They can conduct market research, market their products better and even sell, all in one place. With these innovations, it's only a matter of time before social media takes over the world of retail.

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The Rise of Conversational Commerce

The Rise of Conversational Commerce

Conversational AI is breaking the frontiers of retailer-customer interactions in today’s world. E-commerce used to be about selling products without offering customers a way express needs. However, conversations and personal interactions are essential in e-commerce. It helps retailers understand the customers’ requirements and offer customized products for them.

Today, about 5 billion users across the globe use messaging apps, with a fast-growing adoption rate. Social media and messaging apps are the preferred communication channels for millennials. Retailers can reach their customers by leveraging these messaging apps. Artificial intelligence is one medium that enables conversational commerce to instantly connect with customers. It helps engage and personalize communication to customers, thus driving sales for the business.

Conversational commerce is a two-way discussion between retailers and their customers through chat, messaging apps or voice technology, leading to a fruitful interaction that results in a value-based transaction. It allows retailers to create and nurture a relationship with their customers.

 

Enhancing customer shopping experience

Conversational commerce offers new avenues to connect with customers and improve the user experience.

Suppose a customer is planning to buy a Mother’s Day present, he/she would ideally step into a store and tell an associate about his/her requirement and get recommendations to buy an ideal gift.

Conversational commerce lets retailers take the learnings from the experience and automate the entire process. Retailers can integrate chatbots on their websites or use Virtual Personal Assistants to converse with customers through their online stores. From instantly answering questions to offering personalized choices, automation in commerce boosts interactions.

Additionally, conversational commerce can enable a follow-up experience for customers who abandon their cart. Instead of sending them an email that takes them through a long process to finish shopping, a direct message is a better approach. With a simple message, retailers can inquire whether the customer is willing to purchase the product, ask queries or requires to be reminded later. This allows the customer to take action and complete a purchase, all within the messaging app.

After a customer has purchased an item, retailers can notify about the shipment of the order, allowing customers to easily track their package. Once the order is delivered, retailers can connect with the customers to rate the overall experience, submit reviews or share pictures, with the click of a button.

 

Driving online sales

“Conversations are the driving force behind Conversions”

Customers want an easy and simple platform to purchase their desired products. Having a direct line of communication with their customers helps retailers make sure of sales. Conversational commerce is the way to engage customers at the point of sale to increase the rate of conversion. It opens the door for retailers to have a deeper interaction with customers during the crucial period between winning or losing a sale.

Conversational commerce reduces sales & support costs, overcoming the challenges of mobile browsing. It is a direct, personalized, dialog-driven approach to establishing long-term relationships, collecting data and increasing sales.

 

The purpose of conversational commerce is to provide personalization and convenience throughout a customer’s journey, from sales to service. It helps create a positive experience for the customer and earn loyalty. Moreover, it represents a customized online presence that lets customers request information they need rather than depend on browsing aimlessly through an online store.

Conversational commerce is a big deal as it represents a paradigm shift in the way retailers interact with their customers. It will have a huge impact on the entire customer shopping experience.

 

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Technologies shaping the Supermarket of the Future

Technologies and Trends shaping the Supermarket of the Future

Food businesses will have to change to stay competitive – online, in-store, and at sorting and processing plants too.

The technological boom and the increasing adoption of Industry 4.0 among retailers are creating disruption across all industries. This change is coming to supermarkets which will have an immediate impact on the entire food industry supply chain. Technological innovations – both online and in-store along with the shifting consumer demands will re-shape the supermarket of the future.
Traditional brick-and-mortar supermarket chains are strengthening their own e-commerce capabilities to stay on par with their digitally native competitors. The global grocery e-commerce market is forecasted to expand from an annual value of 43 billion pounds to 135 billion pounds by 2025.

Another aspect that e-commerce players must note is while they are making efforts to establish a strong foothold in the US and European markets, they may face serious challenges because the existing grocery market is saturated and the margins are low. This indicates that the global growth in food e-commerce will be driven by Asia, where there is a willingness to purchase groceries online, along with rapid urbanization, low labor costs, and a newer retail market.

Rising consumer expectations

Widespread food shopping online and fast deliveries to customers’ front doors will only just be the tip of the iceberg in the new world. Computer codes and algorithms will further enable supermarkets to collect data about shopper preferences and habits and use this to personalize their offerings to customers. Recommendation engines further help nudge customers to make purchases similar or related to the products that they have already purchased or been looking for via the “Recommended for you” web pages.

The growing number of people with moderate incomes and lifestyles will become more aware of food safety and more curious about how their foods are sourced and screened. Moreover, food shoppers will develop higher expectations and become critical when buying fresh fruits and vegetables. More will want to know how fresh the produce is and whether or when it is ready to eat.

Consumers will further have the ability to check information about the origins and nutritional value of produce and will be able to see suggestions for recipes and food pairings. This will attract a greater number of customers while making each feel as if they are being provided with individual shopping experiences.

The ad-hoc demand created through the online ‘nudge’ will challenge the traditional food supply chain. Processing lines will need to know precise details about the food – where it is coming from and what is in the storage to meet the demand.

Technology to ensure quality and safety

Grading and inspection equipment – at point-of-origin, prior to shipment to the supermarket, or from the on-line dispatching warehouse – can ensure that the fresh produce has the desired size and ripeness without bruising or mold. In addition, sorting equipment at different stages in the supply chain will be able to provide essential information on sizing, quality and other quality markers.

Traditional supermarkets fight back against the online disruptors – and information about shoppers’ preferences and habits will be an important weapon. Consumer-facing technologies, such as shopping-cart-mounted devices or smartphone apps, will steer shoppers towards the aisles and shelves where they are more likely to make purchases. Sensors in the store’s shelves will keep track of the items customers put in their carts and bill their mobile payment system as they exit the store.

Looking ahead

Another likelihood is that supermarkets will remain the same size but change in concept, becoming destinations for click and mortar shopping. Retailers need to offer consumers a consistent omnichannel experience, stores will connect the physical and digital worlds. Here, consumers can see and feel products they might order online. Here, too, the online product offering could also be accessible via interactive screens.
These changes align with the forecast growth in consumer demand for healthier, high-quality produce, more choice, and greater convenience – a demand which will increase massively as household incomes rise in developing nations, bringing 70 million more people globally every year.

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Conversational AI – The next Step in E-commerce Evolution

Conversational AI - The next Step in E-commerce Evolution

There is no doubt that AI is a popular buzzword in the retail landscape and retailers are slowly recognizing its potential and are increasingly adopting at least one form of AI into their customer journeys or internal processes. By 2019, 40 percent of retailers will have developed a customer experience architecture supported by an AI. Retailers that choose not to incorporate an AI-backed solution into their business strategies will face consequences that can severely affect their bottom line.

Conversational AI can fundamentally transform the way consumers communicate and transact with brands. While this is true across all industries, retailers, in particular, can reap multiple benefits, depending upon their adoption of new technologies. To help retailers understand the importance of implementing Conversational commerce into their retail strategy, here are some aspects where it makes a real difference:

Meeting the customer where they are

Messaging is one of the popular means to interact with one another and that’s how they prefer to interact with brands, too. Conversational AI allows retailers to tap into the most immediate form of communication i.e. messaging and reach consumers in a very convenient manner at a higher scale which was not possible before.

Moreover, with Amazon Alexa, Google Home and now ubiquitous technology in the home and office, as well as with the growing familiarity towards similar technologies, people are shopping with voice-based assistants in greater numbers.

Increased Customer Interaction with Conversational AI

Technology is evolving at a rapid pace, and both web and apps which were once quite the rage among retailers are now tools that are causing friction between the customer and retailer. Conversational AI has the ability to add a new layer of interactivity to online shopping.

It further enables a richer, more complex customer engagement, featuring personalized shopping assistants and concierge bots answering questions, recommending items, and handling individual transactions. This helps to personalize the digital experience at each touch point of the customer journey.

Conversational Design is the New Personalized Web Design

Like the human language, conversational commerce is flat. This allows brands to engage in real relationship-based commerce not usually achievable through websites and apps. While it has the ability to handle a broad set of commands, without AI, it lacks the capacity to understand complex inquiries.

 The integration of AI breaks down these barriers and retailers can turn towards messaging solutions such as chatbots and program them to echo the brand voice as well as provide a more personalized and positive experience unique to each customer.


Conversational AI has the ability to change the way all brands conduct business. It connects them with their customers more organically and creates personalized experiences tailor-made for every individual. This will serve as the first universal interface, increasing the efficiency among retailers and brands as well as maximizing profits.

 

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User-generated Content: Playing a crucial role in e-commerce

User-generated Content: Playing a crucial role in e-commerce

Content is an extremely crucial part of any e-commerce business as it has the ability to drive a large amount of organic traffic onto a website. Businesses must be sensitive to providing the right content which provides the brand a wider range of audiences across the web for minimal cost.

One challenge that e-commerce brands face is the ability to create engaging content across all platforms. Moreover, the true challenge lies in creating engaging content as well as producing enough content.

Producing being the operative word, e-commerce brands have a distinct advantage wherein they don’t necessarily have to create or produce new content when sourcing user-generated content. They can leverage the content sourced from user-generated content (UGC) via various channels such as social media in many forms, such as messages, posts, videos, pictures, etc.

The rise of User Generated Content

Over the past decade, there has been an exponential rise in the amount of user-generated content on the internet and with the popularity of the various social media platforms out there, the growth comes as no surprise.

Customers have been talking about different products and brands for a long time now. With the ability to capture those conversations and interactions across the various social media and other marketing channels, e-commerce brands can avail the benefits without spending too much time attempting to produce newer content.

Why is UGC so effective?

One reason why UGC continues to have increased conversions is:  trust.

Multiple surveys showed that UGC plays an important role in a customer’s shopping journey. Some important findings being - 84% of people trusted online reviews as much as they trusted recommendations from their friends, and 74% of people said that positive reviews dramatically improved trust in a business.

Furthermore, almost 82% of consumers said that user-generated content (like reviews, for example) was extremely valuable in helping them make a purchase decision.

Sourcing UGC is not difficult, yet, deciding what needs to be done after, is important.

Incorporating Customer images in Product pages

Product pages benefit greatly from high-quality images. That being said, every brand going online is upgrading their images to better quality images. E-commerce brands can make their products stand out by skipping the usual images provided by the suppliers and manufacturers and instead, are turning towards customers.

Ex: Popular video streaming service Netflix utilizes UGC to promote fans’ posts about specific shows or movies on Instagram. UGC shows that other people are also getting excited about new shows and movies.

Instagram Netflix screenshot

This can be done if e-commerce brands do away with models, and start looking at their customers as models. Seeing real customers using and wearing products builds significant trust and generates interest in the product. Furthermore, it can also help deliver powerful messages during campaigns using the target audience as representatives for the brand.

Showcasing product benefits

Some brands have to come up with innovative ideas to use user-generated content. While brands selling tangible products such as fashion accessories, or home care products can easily benefit from using UGC easily, brands selling either a service or a software have to get creative.

When there are no tangible products that can be showcased, e-commerce brands can focus on the benefits to the customer and what they may experience using the service or product.

Example: Social media scheduling tool Buffer created #BufferCommunity to showcase photographs and personalities of its many users from all around the world. The aim for this campaign was to source UGC featuring exotic spaces to promote the freedom that Buffer provides.

Instagram Buffer community screenshot

Brands have to focus on how customers use their products and find ways to source UGC, and then insert that into various marketing campaigns - or reshare onto social media to boost engagement and brand awareness.

Including photos with product reviews

Reviews are the easiest UGC on the internet. E-commerce brands generate reviews without doing anything other than providing tremendous customer service and quality products.

To create a more lasting impact with reviews, e-commerce brands can opt for a review platform that enables users to add images as well as videos alongside their written reviews. E-commerce giants such as Amazon leverage this facility for their users.

Customers are more than happy to share their experiences, and that matters tremendously for brands. Many customers prefer to view the product reviews before choosing a particular product as it gives an authentic sense of how the product would appear on them.

The more customers share images alongside their reviews, the more value it brings to the e-commerce store.

Featured photo credit: Photo by rawpixel.com from Pexels

A Tour of CatalogIQ for Grocery

Kick-start eCommerce sales with awesome product data

E-commerce requires awesome product data to support successful search and conversion. Product data for the online grocery market is currently being created manually. Retailers are struggling to acquire the rich product data necessary to support their online needs. Brands are struggling to generate good data.

ContentIQ Add Product

IceCream Labs CatalogIQ is designed to automatically extract attributes from product images. Using either label mechanicals or actual product images of the packaging, CatalogIQ can extract text from the labels. From there, the artificial intelligence in CatalogIQ understands what the text is and inserts it into the appropriate product attribute. The AI can also determine which images are the hero image, and front, back and side images.

CatalogIQ Extracted Attributes

CatalogIQ identifies brand names, sub brands and variants, normalizing the brand to the appropriate text. titles are generated from various attributes to create an SEO-rich title to optimize search. Other key attributes include feature/benefits, ingredients and nutrition facts.

CatalogIQ extracting content from a product

Sample CatalogIQ extraction (front/rear)

How complete is your data?

ContentIQ Catalog List view

CatalogIQ can score the data to help the merchandising and ecommerce teams understand which product records have been enhanced.

  • Missing attributes
  • Accuracy of attributes (are all of the attributes congruent?)
  • How unique are the attributes?
  • Is your product record SEO optimized?
  • Do you have relevant search keywords?
  • How well does your product data match up to customer site searches?
catalog IQ demo screen

Support for Grocery merchandising teams

Grocery merchandising teams have the chore of uploading new catalogs from suppliers and manufacturers. Often this data arrives in the form of a spreadsheet. CatalogIQ can easily upload a new catalog file (in spreadsheet form) to quickly and easily complete the ingestion process.

ContentIQ Add Catalog screen

Support for Grocery and CPG Brands

Grocery retailer and channel partners expect high quality product data to list and sell your products online. Can you deliver the content?

CatalogIQ allows brand and product managers to auto-generate high quality product data directly from product label mechanicals and/or product images. If you're currently using manual processes to create product content and to check the accuracy of product data, then let CatalogIQ help you automate the creation process. You'll be able to complete the data creation process much faster than manual methods. CatalogIQ can also validate the content and ensure that it matches what is contained on all of the product labeling.

CatalogIQ Features

  • Quality product images including relevant Nutrition Facts
  • Accurate meta-data, including attributes like: allergens, sugar free, Kosher certified, Non-GMO and other facets
  • Complete, standardized and SEO enabled titles
  • SEO rich descriptions
  • Correct product categorization

As a merchandising manager with a large product catalog, you know the difficulties of reviewing your product data and ensuring that everything in the catalog is ready to publish live to customers. There is always the nagging concern that something is inaccurate or missing when you push the “publish” button. Every time that you receive new data from your suppliers, it’s a chore to process the data. You have a long checklist to complete before you can publish data to the live catalog. Processing this checklist can consume all of your time.

CatalogIQ Benefits

  • High quality product data
  • Improve product page discoverability 
  • Increase product sales
person using tablet

Tackling DNVBs for emerging brands and legacy retailers

Tackling DNVBs for emerging brands and legacy retailers

The recent years have seen the emergence of DNVBs or micro-brands; brands that focus on providing a niche product for a niche customer, which is changing the consumer brand landscape completely. These direct-to-consumer micro-brands or DNVBs, also known as v-commerce brands, are spearheading new approaches to retail. These brands have a distinct business model; combining the growth of an e-commerce company with the profit margins of a brand.

These brands control the entire experience - from sourcing and manufacturing to delivering product experiences online (website or social media platforms), thus enabling them to iterate product design and demand and connect with their customers in an authentic manner via micro-targeting.

So what can emerging brands and legacy retailers learn from the DNVBs that are disrupting and taking over the e-commerce environment?

Adopt a data-driven model

Standardized messaging is a big no for DNVB customers. High performing DNVBs invest heavily in collecting and measuring data to improve their communication with their customers. They leverage first, second and third party demographic, behavioral and psychographic to design bespoke digital advertising. This further enables them to understand the messaging that would resonate with the different segments in their target demographic.

Every touch point with a customer is devised to convince and convert. Legacy retailers and emerging brands must leverage data to intersect their demographic and strategically target potential customers.

Design strong product experiences

DNVBs offer customers a buying experience which is as memorable as the product. DNVBs create product experiences that are visual, descriptive and transparent (the product is represented in an image enabling the customer to visualize the product as part of their daily life). Furthermore, they also leverage UGC content and customer reviews to further represent the product ensuring that the customer is well briefed about the product before making a purchase. Emerging brands and legacy retailers must further focus on creating strong product experiences to drive revenue.

For example: For a home decor brand, besides how the product looks like, it is important for the brand to provide details about the materials used,  sourcing of the materials as well as the durability of the product. The product page must mention all these details along with the size, height, frame of the product. Pages that include lookbooks or UGC content further helps the customer to make a better choice.

Build tech with a human touch

DNVBs collect data on every transaction and interaction with customers and leverage this information to better understand their customers and how they behave online. The goal is driven to be relevant, highly personalized, efficient and convenient for the customers.

Traditional or emerging brands, while interacting with their customers, must ensure that their message is personalized. For ex: If the customer in the past has purchased organic, whole wheat pasta, the messaging they could receive could include organic tomatoes or organic arrabbiata sauce they could use for their pasta.

Take the brand experience offline

Digitally native brands understand the importance of brick and mortar and do not restrict themselves to being digital-only. DNVBs often expand to shops through partnerships with third-party retailers, pop-up stores or by creating their own physical locations. Moreover, these locations are heavily marketed by influencers, with strategic content as well as promotional offers. They ultimately expand from a digital-only space but without sacrificing their brand or customer experience.

Most e-commerce companies are heavily focused on distributing other brands' goods and competing with e-commerce giants like Amazon, Walmart, and Alibaba while DNVBs are paving the way for a new retail experience with technology, social sharing and being perceptive to the shifts in consumer buying behavior.


Consumers are increasingly demanding informative and convenient product experiences across every sales channel and with more DNVBs coming into the market, expanding their presence beyond digital channels to brick and mortar stores, it is imperative for traditional brands to take inspiration from the DNVBs and adapt their business models to the changing consumer trends. Brands that can not only meet these expectations but also deliver on it will be the most successful in the digital space.

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person doing online shopping via mobile

The Rise of Digitally Native Vertical Brands (DNVBs)

The Rise of Digitally Native Vertical Brands (DNVBs)


In the past, brands that dominated supply chains, dominated the markets share in their category. P&G, Unilever are brands who owned their categories for the past few decades. With the shift towards digital, there was a rise in direct-to-consumer brands called Digitally Native Vertical Brands or DNVBs.

What is DNVB? A brand that is digitally native, vertically integrated company that sells its own products and controls its own distribution via the web maintaining a strong focus on customer experience. While the DNVB starts online, it often uses a brick-and-mortar strategy. This term was made popular by Andy Dunn, founder of a famous online-first brand, Bonobos.

DNVBs have been shaping a new Retail landscape in the US, building competitive advantages and differentiators enabling them to not only compete with well-established brick-and-mortar businesses but also leading e-commerce businesses making a huge impact on what consumers expect from brands. Some of the DNVBs include Blue Apron Inc., Casper, Dollar Shave Club, and Home Chef.

Let’s take a deeper look into three growth strategies of these brands that proved successful:

Personalization in products 

The product offerings in DNVBs are truly unique to each buyer, and these brands take time to craft experiences based on the specific user taking into account their needs, preferences, and behavior.
For instance, Blue Apron takes into account the preferences of the customer and with this information, provides custom meal options that would suit that customer’s need and likes, giving the customer a personalized brand experience.

Customized products require a lot of information and attention to details which requires a different supply chain that big e-commerce companies like Amazon are yet to provide. This provides DNVBs an edge within a cut-throat, competitive ecosystem.

Vertical integration

A brand that sells directly to customers combines multiple benefits - lower cost of online sales, better control of the whole supply chain from manufacturing to distribution.

A great example of vertical integration is Everlane, a web-only clothing brand that compares its own pricing to that of traditional retailers and is able to share with its customers its cost break down as they know their supply chain.

Tech roots

DNVBs are more like tech companies rather than retailers as they build their own retail technology to sell better. It further enables them to track customer interactions, manage inventory, offer store credit, gather feedback to improve data curation, etc.

This user-centric and data-centric approach of DNVBs emphasizes all the steps of the user journey, from pre-purchase to post-purchase experience. This helps meet customer experience and generate loyalty while still offering them a highly personalized experience depending on location, customer behavior, purchase history, etc.

Web-only brands have often become frequent acquisition targets, not only because of the products they sell, but also because of the talent and technology they bring to the traditional retail structures leading to  deals like Unilever’s one-billion-dollar for Dollar Shave Club. Another strategy that retail applies in order to avoid the downsides of an acquisition is to take part in the funding of startups of web-only brands such as Target and $170 million dollar series C led by Casper.

While all the retail companies are leaning towards technology to find new ways to innovate and change the customer experience, a factor that web-only brands or DNVBs heavily rely upon is to scale as well as the ability to attract and retain talents. This is something that traditional retail organizations are yet to tap into completely. 

The retail industry has never been as competitive as today, with three e-commerce giants Amazon, Walmart, and Alibaba taking the large chunk of the e-commerce revenue as well as the technological acceleration being this quick. Among all the retail players, a new category of business is on the rise, disrupting the industry.

Stay tuned to see what must traditional brands do, to keep pace and compete with DNVBs.

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AI and Automation are transforming the E-Grocery experience

AI and Automation are transforming the E-Grocery experience

The concept of e-grocery is not new, with existing e-commerce businesses like Walmart To Go, Amazon Fresh and Instacart, but with Amazon acquiring Whole Foods, all the players in the grocery retail industry have realized that grocery shopping is at the brink of transformation and are changing their strategies to accommodate and incorporate online shopping into their business goals. 

The focus is on providing solutions to enhance customer engagement, optimize inventory management and upgrade logistics for accurate and speedy delivery. To address these concerns, businesses are investing in technologies like artificial intelligence (AI), machine learning (ML), big data, internet of things (IoT), cloud computing, autonomous robots, virtual and augmented reality (VR/AR).

Challenges of e-grocery inventory management

The success of an e-grocery business essentially depends on inventory management. The fundamental problem that needs to be addressed is stocking: with grocers finding the right balance between understocking and overstocking. 

Overstocking uses up costly warehouse space and locks up capital which could be otherwise made available for resources. Products decay over time and with perishables, the decay is often quicker, in some cases, by the end of the day. Every wastage affects the business, increasing the costs and making it unproductive.

While on the other hand, understocking hinders the growth of the business. No grocer wants customers abandoning their shopping carts because of the inability to supply an item. While there are options to pre-order products that are not in stock, groceries are fast moving products that customers need on a regular basis. Grocers cannot list fruits, vegetables, cereals, soaps, detergents, and personal care items as out of stock. The demand for them is instant.

Optimizing inventory is crucial for the survival of the grocery industry. It’s no surprise that e-grocers are leaning towards innovative technologies to enhance and optimize their inventory management processes.

aisle with fresh fruits

Emerging trends in e-grocery

Big Data, AI and Machine Learning

E-grocery businesses generate a significant amount of data about purchasing patterns which can be useful to predict future trends. However, this data needs to be examined and categorized to make it efficient and useful. Here’s where data analytics and machine learning come in to help grocers extract relevant insights which help them make strategic business decisions.

Businesses are leveraging AI to predict operational failures and improve warehouse management. As machine learning models get smarter, the systems get more efficient over time.

Automation and use of robots

Besides inventory maintenance, the physical movement of the inventory is another challenge for the grocers as it requires a considerable amount of human labor. Technologies like automation and robotic systems are helping businesses by taking over these manual tasks.

The robotic systems are automating operations for customer orders and are also helping businesses to build space-saving warehouses and utilize the complete area efficiently without wastage. There are rails between aisles for robots to move around, stock and fetch products. Robotics and automation go hand in hand towards reducing the size of real estate investments.

Self-Drive logistics

Another challenge that e-grocers face is delivery of the products to the customers.

Groceries differ from regular e-commerce products such as shoes, or furniture items in two ways: the quick turn around time expected by the customer and the perishable nature of grocery items. As the order volume of the e-grocery business grows, the logistics system needs to scale along with it. This, in turn, increases the delivery cost that further affects the business.

Businesses are turning towards self-drive vehicles to deliver groceries to customers and with startups like AutoX with self-drive car deliveries and Marble with a sidewalk delivery robot coming in the market. As transport technology advances, self-driving automatons can become the next big thing to look out for.

The future of e-grocery

As online grocery businesses are adopting the latest technology to solve the supply chain, inventory management, and logistics problems, even small grocers are able to leverage these technologies to scale their businesses through automation and predictive analytics.

Moving grocery online has been a major problem with the high demand for operational excellence and the low margin of the products. This is a hard sell for many businesses, but with the advancements in AI, Machine Learning, Automation, Robotics, this is changing. This can be seen from the growth of e-grocery ventures that are emerging around the world.

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