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The Power of AI in Retail

Power of AI in Retail

Meet the Team Cognira Series

With each passing year, technology is becoming more advanced, effective, and most importantly, more personalized. With the help of artificial intelligence (AI), daily tasks and processes that are unique to us are automated by a learning system to further bring efficiency and value to our lives.

But how does this tie within retail? What value does AI bring to the grocery climate? In our third installment of the Meet the Team series, Mark Bloemeke, Co-founder and Chief Technology Officer at Cognira, shares his knowledge on the impact of AI in retail, and how it will help grocers understand their customers on a deeper level.

Meet Mark

Mark Bloemeke
Mark’s relationship with AI started at a liberal arts college in West Virginia, where he studied Computer Science and minored in Accounting. He later went on to get his masters and PhD at the University of South Carolina where he focused on research in artificial intelligence. After nearly 10 years of higher education, it only seemed natural to pursue a teaching career, and become a professor educating students on Computer Science/AI. However, this path just wasn’t for Mark.
With the help of a personal connection, Mark left the professor’s life to pursue working for a startup company called Retek, where he focused on Retail Forecasting, Retail Planning and Data Mining. Since then, Mark has been part of many different companies- from co-founding LogicBlox, to working for a private data storage company and hedge fund.

Mark’s talent and expertise within artificial intelligence, focus on retail, ability to communicate complex ideas to a client, and deep connections built at Predictix made Mark a perfect fit as Co-founder at Cognira

Brief Dive into the Basics of AI

Just a quick google of the word ‘AI’ shows us images of robots intertwined with human hands and vague definitions that leave us scratching our heads. But what does AI actually mean?

When we use the term, AI, we are referring to machine learning and advanced analytics that can independently learn from past decisions and adapt to optimize results. An easy way to understand AI is the ability for a computer to perform tasks that typically require human effort.
AI
However, the only way for AI to be effective is if it is taught by a human with extensive knowledge of the topic at hand. For example, if you are attempting to automate the supply chain process, the human teaching the AI needs to understand the flow of goods and services, inventory and fulfillment process, etc.

It’s important to note that AI is essentially making the computer do something that humans currently do better! (So no, computers can’t think for themselves on their own…yet.)

What AI Looks Like in Retail

artificial intelligence in retail

Now that we understand the basics of AI, let’s dive into three examples of how it’s represented in the retail and grocery climate.

Merchandising

  • Ability to better understand the depth and breadth of your assortment. For example, what item to carry, how many different options (flavors, colors, styles).
  • Instead of relying on gut-feeling, retailers can better understand what to promote, how to promote, and when to promote down to the customer level.

Inventory Management

  • Have confidence in knowing how much inventory to send to every store, and how much to hold back
  • Better at predicting how much you are going to sell, how to minimize your inventory and maximize your service level.

Order fulfillment optimization

  • Optimize when to ship from a store, how many shipments to send/where, etc.

Why Grocers Should Invest in AI

Connect Deeper With Customers

At the end of the day, the most important goal as a retailer is to connect and build a strong relationship with their customers. With the power of AI, retailers are able to provide an immersive shopping experience that can line up particular customers with the products they care about. (Something humans alone cannot solve cost effectively at scale)

Stay Ahead of the Competition

In today’s climate, big tech companies like Amazon and online grocery delivery applications like Postmates are winning over customers due to their omnichannel experience. In order for grocers to stay ahead of the competition, it is vital for them to pair their domain knowledge and expertise within retail with AI/ML to better plan, forecast, and optimize.

“Grocers need to become tech companies faster than tech companies become grocers” – Craig Boyan, President at H-E-B

All insights and analytics provided

Many retailers today use disparate spreadsheets and legacy systems to analyze their data. By investing in AI, retailers can bring all of their data into a single platform, making collaborating, planning, and analyzing significantly more effective. Likewise, utilizing AI gives retailers the opportunity to analyze billions/trillions of data points to accurately maximize their desired goals.

Optimize for best decisions

Rather than relying on just gut-feeling or industry knowledge, AI has the potential to provide powerful what-if capabilities that can simulate thousands of possible scenarios and provide prescriptive recommendations. This gives the retailer the opportunity to reach their desired goals around sales, quantity, revenue, or margin.
Retail Analytics
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About Cognira

About Cognira

Cognira is the leading artificial intelligence solutions provider for retailers. Cognira is passionate about helping retailers unlock valuable, transformative business insights from their data.

We know retail. We love data.

To learn more, check out our website at cognira.com or contact us today to get started. 

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Founded by experienced data scientists and retail experts, Cognira is the leading artificial intelligence solutions provider.

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