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Pushing sales in offline stores with artificial intelligence (AI)

When it comes to data analytics, online retailers are often one step ahead of brick and mortar retailers. Frequency analysis, demographic data analysis and special heatmaps that reveal where users click, how fast they scroll, how they navigate, and which elements attract their attention make it easy for the online seller to understand his customers and to take appropriate user-friendly measures to optimize the online store.

Video analytics and artificial intelligence make it possible as well for offline retailers to gain insights about their customers and allow them to derive appropriate store measures that push sales. Our partner Aurify Systems works with innovative technologies that make offline retail ready for the future by offering interesting solutions that are easy to implement!

Video analytics and artificial intelligence boost the Indian offline retail

Video analytics are already being used by some large retail companies in India. For some time now, two large fashion retailers have been using systematic customer frequency analyzes, demographic data analyzes (analysis of gender and age) and diagrams for the visualization of data - so-called heat maps - at their stores.

Customers should of course feel comfortable and easily find their way around, but they should also be encouraged to buy. An optimized store layout, offers displayed at strategically well chosen corners and attentive staff can all contribute to a double digit sales growth. But how can video analytics and artificial intelligence support?

  • Imagine that the staff at the fashion retailer gets an instant alert when a customer enters a particular area of ​​the store. The employee on duty warmly welcomes the customer and offers his advisory service.
  • Also imagine that the advertising space automatically displays men's or women's trends in real time - depending on whether there are more men or women are looking around in a certain fashion store area.
  • A customer is approaching the store exit without any shopping bag? How about a discount campaign that is shown on the advertising screen on the way to the exit that encourages once more to buy something?

By analyzing data, the fashion retailer can find out in which areas of the store promotional items are sold well and which "cold" – or poorly visited – zones may need an update in terms of attractiveness. Which route does the customer prefer to get to the changing rooms? Where does the customer look around while waiting in the checkout area? Does a certain customer group particularly respond to specific product groups? Is a target group particularly receptive to discounts? Does the number of items in the shopping bag change if certain measures are taken? When this data is available the store concept can be adapted in order to enhance customer experiences. Moreover, valid customer data (in contrast to the subjective perception of the staff) is the basis for advertising measures that somehow regulate and control certain target groups. For example, if you want to get the older audience into the fashion store during the week so that the staff has more time to assist and service, you can organize special mid-week campaigns that address this target audience.

In addition to sales promotion, resource planning is an important aspect for offline retailers. The management can allocate more human resources on busy shopping days or during rush hours and reduce staff during weak seasons. The number of customers that are in the shop simultaneously can be easily regulated.

The solution portfolio of Aurify Systems is based on image acquisition using existing camera systems (e.g. surveillance cameras) and does not require any additional sensors. The processing of the images is available as an on-premise or cloud solution. The use of artificial intelligence (machine and deep learning) helps to make analyzes more and more precise and meaningful over the period of use. Artificial intelligence simulates human intelligence in a certain way. The system also learns from experience and can draw its own conclusions.

Video analysis, artificial intelligence and data protection?

In principle, video recordings are taken by the cameras installed. These are analyzed and evaluated by a certain software solution. However, the images are never stored anywhere. The accumulated data helps the retailer to make strategic decisions and define certain sales promotions.

At this point the "transparent consumer” raises his concerns. But frankly spoken nobody has to worry about data analysis in brick-and-mortar retail as we are living in a digitalized world and are leaving a digital footprint whenever we are shopping online. Due to the technology used in offline shopping environments, retailers can adapt their product range and store concept much better to their customers. Of course, the retailer aims for increased sales when better responding to the needs of the customer. The conversion rate, which mainly was used as a key performance indicator (KPI) in online sales, is now slowly finding its way into brick-and-mortar retail. Putting the number of visitors in relation to buying customers and evaluating the impact of certain measures on this ratio helps to develop the promotional offline activities.

Neither personal data nor any kind of sensitive data are stored by the software of Aurify Systems. Instead of an individual customer behavior, the overall behavior of the entire customer base is analyzed. Compared to the analysis and tracking options of the e-commerce business, the video analysis for data acquisition and the associated learning software in the background developed by Aurify Systems are extremely customer-friendly in terms of data protection and security. Nevertheless, this information provides a lot of value as the retailer is able to base promotional sales activities on meaningful data.

If you want to discuss a specific project idea, please contact Antonia Schachinger (Sales Application Engineer).

Easily regulating the number of customers that are in the shop simultaneously.

Customer specific promotion due to video analytics.