Retailers, malls bet on artificial intelligence, big data to drive businesses

India’s malls and retail outlets are evolving fast. As technology has advanced and more and more customers are leaving behind a digital foot print, even brick and mortar retailers and big shopping centres are now adopting big data and artificial intelligence to better serve their customers, in turn to boost sales and also manage inventories more actively.

India’s largest retail estate developer DLF, which operates the DLF Mall of India, the country’s biggest mall, launched its own ‘phygital’ platform Lukout on Wednesday at the ongoing India Retail Forum (IRF). The platform, which will be made available to all the brands and retail partners for free, will help brands optimise their marketing spends. Customers will be able to plan the shopping by browsing the malls over the platform, get a glimpse of the latest fashion trends and also get real-time offers from the brands while at the mall. It is essentially a bid to offer a personalised experience to shoppers.

“We are seeing the online space is growing. So, we wanted to create a disruptor by creating a platform, an app, which is a combination of artificial intelligence, backend etc. to put it all together into a space, where a lot of features are added… You will be able to make payments at the car park through the app, you will be able to look at the trending looks… you will get proximity marketing the moment you enter the property,” said Pushpa Bector, executive vice-president and head of DLF Shopping Malls told THE WEEK.

The platform will be initially extensively marketed to the retailers and then be rolled out to consumers, in-time for the festive season. The company is targeting one million downloads within one year, added Bector.

Fashion and lifestyle brands too are adopting new technologies to manage their supplies better. Earlier, a company would have to wait for the end-of-the-season sales to clear out their unsold inventories. Now, brand managers can track their supplies and inventories on a more real-time basis. Through the help of data analytics, companies can monitor where people are shopping the most at what time, in store or online on their own website, or on e-commerce platforms like Amazon and Flipkart and stocks could be accordingly allocated.

Earlier, brands used to make available only limited inventory to e-commerce platforms, in order to ensure their products were not discounted often, compared to in-store. Now, Arvind Internet, the e-commerce arm of textile major Arvind, is pioneering a new initiative where in a brand’s entire inventory would be made available to fashion e-commerce retailers, just as it will be available in-store and on a brand’s own portal, thus making available everything to customers, irrespective of the platform, online or offline.

“Shoppers that want to shop a particular brand on a platform like Myntra would typically find 10-20 per cent of the inventory. Now, if you open all the inventory from the brand’s stores and warehouses on Myntra, of course you are going to see an uplift. Your inventory that is lying unproductive in store now gets sold to customers looking for it. You are hedging your inventory risk by opening up everything to everybody, regardless of where they shop, instead of trying to predict consumer demand,” said Mukul Bafana, CEO of Arvind Internet.

AI is also making it easier for brands to do multi-channel optimisation in terms of pricing and promotions and what the pricing should at the store level and channel level.

Arvind Internet has a product called Omni AI, which will help in dynamic pricing and promotions. Through such products and machine learning, in about eight weeks of a season going live, brands will be able to find out, which products have succeeded and those that have not.

“Why wait for another eight to nine weeks for the season to end, before the brand can discount the misses? You could start more dynamic pricing and promotion across channels early in the season. The product will also allow you to effectively figure out how to price your line across channels and across the season,” added Bafana.

Kishore Biyani-owned Future Retail, which operates the Big Bazaar hypermarket chain, is also relying extensively on analysing habits of its customers to offer them enhanced service through its Easyday small stores.

“We personally believe that technology will be used in a big way in retail. How does one create a new model of retail, using technology to service, using technology to predict, using technology to create assortments… Technology will be a key thing and data will be very important,” said Biyani.

The company last year rolled out its retail 3.0 strategy with plans to set up 10,000 members only Easyday neighbourhood stores. Currently, the company is opening around two stores a day, which will be ramped up to three stores a day from next month and five by next year.

“The whole idea behind these stores is to promote membership so that customers coming to our stores buy regularly and since they are members, we have data of what they are buying and the pattern of their buying. With new technologies, we will be able to forecast what assortment we should pick,” said Biyani.

E-commerce companies are also making extensive use of big data analytics, AI and machine learning to understand customer habits and curate offerings.

 

Written by: Nachiket Kelkar

Source: https://goo.gl/ZMXet1