Tag: shoppers

By Lisa Du and Ayaka Maki for Bloomberg/Fin24

It’s watching, and knows a crime is about to take place before it happens.

Vaak, a Japanese startup, has developed artificial intelligence software that hunts for potential shoplifters, using footage from security cameras for fidgeting, restlessness and other potentially suspicious body language.

While AI is usually envisioned as a smart personal assistant or self-driving car, it turns out the technology is pretty good at spotting nefarious behaviour. Like a scene out of the movie “Minority Report,” algorithms analyse security-camera footage and alert staff about potential thieves via a smartphone app.

The goal is prevention; if the target is approached and asked if they need help, there’s a good chance the theft never happens.

Vaak made headlines last year when it helped to nab a shoplifter at a convenience store in Yokohama. Vaak had set up its software in the shop as a test case, which picked up on previously undetected shoplifting activity. The perpetrator was arrested a few days later.

“I thought then, ‘Ah, at last!’” said Vaak founder Ryo Tanaka, 30. “We took an important step closer to a society where crime can be prevented with AI.”

Shoplifting cost the global retail industry about $34bn in lost sales in 2017 – the biggest source of shrinkage, according to a report from Tyco Retail Solutions. While that amounts to approximately 2% of revenue, it can make a huge difference in an industry known for razor-thin margins.

The opportunity is huge. Retailers are projected to invest $200bn in new technology this year, according to Gartner, as they become more open to embracing technology to meet consumer needs, as well as improve bottom lines.

“If we go into many retailers whether in the US or UK, there are very often going to be CCTV cameras or some form of cameras within the store operation,” said Thomas O’Connor, a retail analyst at Gartner. “That’s being leveraged by linking it to an analytics tool, which can then do the actual analysis in a more efficient and effective way.”

Because it involves security, retailers have asked AI-software suppliers such as Vaak and London-based Third Eye not to disclose their use of the anti-shoplifting systems. It’s safe to assume, however, that several big-name store chains in Japan have deployed the technology in some form or another.

READ: Amazon facial AI matched politicians with criminals in test
Vaak has met with or been approached by the biggest publicly traded convenience-store and drugstore chains in Japan, according to Tanaka.

Big retailers have already been adopting AI technology to help them do business. Apart from inventory management, delivery optimisation and other enterprise needs, AI algorithms run customer-support chatbots on websites. Image and video analysis is also being deployed, such as Amazon.com’s Echo Look, which gives users fashion advice.

“We’re still just discovering all the market potential,” Tanaka said. “We want to keep expanding the scope of the company.”

Founded in 2017, Vaak is currently testing in a few dozen stores in the Tokyo area. The company began selling a market-ready version of its shoplifting-detection software this month, and is aiming to be in 100 000 stores across Japan in three years. It has ¥50m ($450 000) in funding from SoftBank Group’s AI fund, and is in the middle of its series A round, seeking to raise ¥1bn.

What makes AI-based shoplifting detection a straightforward proposition is the fact that most of the hardware – security cameras – is usually already in place.

READ: Microsoft seeks to restrict abuse of its facial recognition AI
“Essentially this is using something that’s been underutilised for decades,” said Vera Merkatz, business development manager at Third Eye. Founded in 2016, the startup offers services similar to Vaak in the UK market, where it has a deal with a major grocery chain. Third Eye is looking to expand into Europe.

The ability to detect and analyse unusual human behaviour also has other applications. Vaak is developing a video-based self-checkout system, and wants to use the videos to collect information on how consumers interact with items in the store to help shops display products more effectively.

Beyond retail, Tanaka envisions using the video software in public spaces and train platforms to detect suspicious behavior or suicide jumpers. At Third Eye, Merkatz said she’s been approached by security management companies looking to leverage their AI technology.

“The potential is broad since it can be applied outside of shoplifting prevention and outside of retail — such as with manufacturing or other types of marketing,” said Hiroaki Ando, a retail consultant at Ernst & Young Advisory & Consulting in Tokyo.

Source: Supermarket & Retailer 

It’s no secret that South African shoppers are beset by a storm of rising prices and it seems their shopping baskets are definitely feeling the pain with the average consumer now hyper aware of what they’re purchasing.

As a result, the latest Nielsen Shoppergraphics Report – which looks at shifts in consumer purchasing behaviour within 4 000 representative households across the country on a quarterly basis – reveals local consumers have dropped products from an unprecedented three grocery categories from their shopping basket; namely Household/Cleaning Goods, Beverages and Toiletries.

Nielsen CPG client service director Kelly Arnold comments; “It’s no secret that South African consumers are experiencing a severe wallet squeeze thanks to a raft of rising costs including spiralling petrol and electricity prices, the implementation of sugar tax and a VAT increase to 15%. The effect that this has had on consumer behaviour is profound and we’re now clearly seeing shoppers jumping out of some categories and consolidating their spend.

“As the household basket has become more expensive, we have also seen consumers limiting the number of trips, to 60 trips a year on average, and the top up shop that used to be twice or three times a week has dropped to once every two weeks, with spend per trip now averaging at R210.”

Overall the volume of sales has grown by 2.8%, with the monetary value of sales growing at about 6.3%.

“That said, we’re simply not seeing massive growth with consumers shopping less and spending slightly less; although there are instances of upgrading to larger pack sizes which may be a contributory factor to the small levels of growth.

“Interestingly, the repertoire or number of stores that consumers visit has increased to 4.9 retailers a year. This is as extremely price conscious consumers seek out deals, and are more prepared to shop around.”

What’s in and what’s out?
Drilling down to category performance, Arnold reports that consumers now purchase around 68 categories per year. “We have seen a move towards consumers spending more on dry groceries and perishables with staples remaining stable. The highest amount of spend is happening in frozen chicken and ready to eat cereals, sugar and UHT milk (a long-term trend) and canned meat. The latter might be because of the Listeriosis crisis earlier this year which compelled many consumers to switch from cold meats.

Looking at the specific categories that have experienced the biggest declines Household/Cleaning Goods which are no longer seen as a necessity have dropped by 6% and Beverages by 6%, with Carbonated Soft Drinks (CSDs) experiencing particularly negative performance.

“In this regard, contributing factors may well be the shift in volumes from 500ml to 450 ml size bottle within some of the top brands as well as an influx of other brands carving out a market share for themselves and now spreading their national footprint,” explains Arnold.

An upswing in branded retail
The Shoppergraphics Report also revealed a shift towards modern branded retail outlets away from independent retail within the LSM 1-6 market.

“The growth in usage of branded retail chains by this market could be due to the fact that more retail chains have opened stores in previously under-served areas with large, traditionally modern trade retailers having invested in this sector in the last two years. We also know that branded retail offers more competitive pricing and is therefore seen as less expensive,” says Arnold.

In contrast, higher LSM groups are increasing their spend in independent retail. “The type of behaviour driving this trend is that higher LSM groups are going to branded retail for their big monthly shops and utilising independent retail outlets to do their more frequent top-up shopping. For example, ‘I’m on my way home to Soweto I stop at the taxi rank where there is a Spaza shop nearby, grab a couple of things as a top-up’, resulting in LSM 7-10 spending more there,” explains Arnold.

To counter these trying times, retailers need to ensure they have the right composition of goods for their shoppers, at the right price given that positive price perception is extremely important for future success.

Arnold stresses: “Retail data has also never been more important in order to move past tough times .”

Menlyn Park Shopping Centre, which is currently undergoing a major R2-billion redevelopment, has introduced a unique concierge ambassadors programme to minimise inconvenience to shoppers. Twelve fully trained concierge ambassadors are stationed at the busiest nodes of the mall to advise and guide shoppers during trading hours, seven days a week.

“During a refurbishment project such as the one we’ve implemented, it’s very important to make sure that shoppers are well informed of the processes that are underway. This is one of the reasons why the concierge ambassador programme was started,” says Andrea de Wit, marketing manager of Menlyn Park Shopping Centre.

Apart from helping shoppers to navigate through the centre during renovations, the ambassadors provide helpful hints and updates on new tenants. “Our shoppers have been thoroughly delighted by this initiative and it’s had a positive effect on our footfall numbers over this period.”

The ambassadors are stationed in the existing centre, in the Village (the “temporary mall”) and in Grocery Avenue, which contains the centre’s main food and grocery outlets. They will be on duty right through to December 2016, seeing the centre through most of its renovations.

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