Inside Look: Xcelerate Dallas Breathes AIR into Retail

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Inside Look: Xcelerate Dallas Breathes AIR into Retail

By Jamie Grill-Goodman - 10/11/2019
Dr Pallab Chatterjee, Chairman & CEO, Symphony RetailAI, presents the opening keynote

Amid a charged crowd in Dallas, Kevin Sterneckert, Chief Marketing Officer, Symphony RetailAI, welcomed all to the beautiful Four Seasons and opened the Xcelerate, Breathing AIR into Retail event. The two days of sessions and exciting presentations really drove home the idea that knowing your customers is the key to never losing them and perfecting category management in every store.

In the opening keynote, Dr Pallab Chatterjee, Chairman & CEO, Symphony RetailAI shared with a packed audience the journey Symphony RetailAI has been on since its inception in 2018.  He described the results the company has seen from working with customers on AI deployments across marketing, promotions, category management and demand forecasting, and how that experience is now shaping where Symphony RetailAI takes artificial intelligence (AI) next in order to deliver tangible improvements for its customers and equip them to identify, activate and realize future growth and profit opportunities.

Chatterjee noted growth is the number one priority he hears from Symphony RetailAI’s customers. He touched on a few examples of growth opportunities, such as click and collect. They found 63% US consumer want curbside pickup, while 56% want purchases delivered to the car trunk. They are finding Walmart has 11-13 % of customers using curbside service, by next year it will account 33% of Walmart’s digital sales. He also talked about Farmstead, and how they are giving fast, reliable free delivery, along with fresh food the same price as the store and refill staples each week to save. They don’t own a store, they are successful with a new model.

Chatterjee gave an overview of how Symphony RetailAI is breathing air into retail and introduced CINDE to the room, the industry’s first AI-powered personal business decision coach. He showed an example of CINDE Finds, prescriptive analytics via mobile which allow the user to take an action rather than spending time sifting through data. CINDE is now able to recommend promotions and help category managers with ad planning. These technology innovations are changing the way decision makers work, providing prescriptive recommendations based on the customer.

Chatterjee says the company expects to deliver revenue and margin growth to customers in year one, bringing breakthrough AI-enabled innovation for customer-centric merchandising, marketing and supply chain.

Symphony RetailAI CEO Explains CINDE

I had a chance to talk one on one with Dr Pallab Chatterjee, Chairman & CEO, Symphony RetailAI, who told me retailers are saying stores and store execution are become even more important with the implementation of click & collect solutions, thus the challenges they face are not going away.

CINDE, Chatterjee explains, is bringing capabilities that assist in the day-of-the-life of a category manager. The AI models are connecting the dots in all the available data to say “this is what we found.” He says Symphony RetailAI’s mission is to provide 2%-plus incremental growth. The company is looking at all of the places where we can help, he says, but CINDE’s AI recommendations are coaching retail employees, rather than taking over the decision making, thus helping to sidestep the fear many have about AI removing the need for a human element.  

One of the biggest efficiency problems retailers have is that e-commerce players can change assortment quickly and stores have to be able to become more agile, he explains. Being able to adjust your assortment on demand inside the store, instead of a few times a year, helps physical stores compete with online players. 

Going forward, in addition to looking at opportunities for applying AI, Chatterjee says CINDE is getting smarter. For example, in the demand forecasting AI model, when weather data was added it got much more accurate. Every time you give it new data it tries to figure out pattern matching, and thus gives more accurate recommendations. This is the difference between a deep learning AI model and a statistical regression model. Deep learning means the AI can makes inferences, Chatterjee explains. “It really gets better and better with the more data you feed it.”  This is a step above machine learning, because you’re training the machine to make its own inferences.

We are feeding the model information and the compounding of the data from all of the retailers we are working with is making it get smarter over time, says Chatterjee. Meaning, the more retailers that work with Symphony RetailAI, the smarter the AI will grow.

“It does take time for the models to learn and get better over time,” he notes. “CINDE is a lot smarter today then she was two years ago,” when the AI was born.

Alasdair James, Global Executive and Board Director, followed, presenting his keynote “Future Expectations in Retail. What’s coming in the near future?” James spoke of what retailers and CPG manufacturers need to do today to prepare for tomorrow, and the must have capabilities required to meet the needs of customers.

He used the example of how AI can enable strategies for the upcoming evolution 5G technology will drive, but dove into how technology is creating complexity, noting “you could spend your whole year assessing tools.” He posed the question, how can technology help us spend less time, rather than more time and talked about growth, as Chatterjee did.

He spoke about Wayfair, noting that an article that came out saying the company was overvalued by 84%. Yet the share price went up and continued to go up thanks to topline growth.

“If you’re growing, you have the right to a future,” he pointed out.

He related this opportunity to AI, explaining to the audience how the only real competitive advantage companies have is their people, and how associates adapt technology is key to success. Driving topline revenue growth from new consumer engagements is important and colleagues need to spend more time focused on meeting changing consumer needs, which is where AI can help.

“You have to invest in growth, and then you have to invest some more,” he closed.

Lisa Kinney, Albertsons, Talks data challenges

Lisa Kinney, VP of Customer Strategy and Merchandising Analytics, Albertsons, presented “The power of customer data” in which she shared the journey Albertsons is on to become customer-centric and ensure customer insights are at the heart of its operations.

Lessons she’s learned so far?

  • It’s complicated
  • Time is priceless: There is no extra time in the workday
  • We’re not lacking in data and tools: The data the retailer has on its customers far exceeds her expectations. It’s more about how do you connect it all.
  • Simplicity is key: CGs need to explain simply and know their customers
  • Causation and correlation is hard to answer: This is a customer world, we can’t look at it as a category world anymore.

She talked about how diagnosing and anticipating is something the retailer is working on, using predictive anticipation to tell where customers are going. “We can test, learn and scale, and the science behind that is incredible.”

Heinen’s Talks Computer assisted ordering

After a break in the Innovation Zone, Rick Fink, Director of Supply Chain, Heinens, presented “Meeting customer expectations in every store.” Heinen’s Grocery Store, celebrating its 90th anniversary, continuously strives to deliver the best customer service while offering the freshest, highest quality foods. To meet its customer's expectation requires having the right assortment, available at the right time, at a value. Heinen’s latest project to automate store replenishment is helping it continue to drive customer satisfaction.

Computer assisted ordering (CAO) is being used currently by 7 of its 23 stores. Two pilot stores have close to 50% of packaged goods being ordered through CAO. The goal is to have all 23 stores ordering nearly 100% of packaged goods in grocery, dairy and frozen by May 2020. After this it will evaluate the perishable departments.

“The first time we started, we put a hold on it. It wasn’t because of our system, it was because of our disciplines at the front end.”

But the benefits have included a reduction in out of stocks, better rotation of stock resulting in better dates for customers, and associates spending more time on the floor helping customers since they don’t need to scan an order. The retailer has also reduced its back stock.

“When we have an issue, we give [Symphony] the issue.” Heinen’s undergoes constant process evaluation. Like many retailers, Fink says the biggest challenge has been change management.

“The key for a 23 stores chain is we have to focus on our customer,” he says.

Guest keynote speaker Tanya Streeter, World Champion Freediver, closed the night. Streeter still holds the longest-standing world record in the sport, having dived on a single breath to a depth of 525ft/160m in the No Limits discipline off the coast of the Turks and Caicos Islands in August 2002. Streeter talked about how having the right support system around you is key to success. As humans we strive to do what seems impossible and quite often, with training and collaboration, the impossible, becomes possible.

Tanya Streeter, World Champion Freediver, on stage with Kevin Sterneckert, CMO, Symphony RetailAI

“Your mind is going to be your weapon or your weakness,” she says.

Streeter shared her observation that nothing moves us forward more than competition and in business this is called innovation. She closed by noting that what she’s learned is the limits are “nowhere near where you think they are.”

Day Two

To start the day I got a firsthand demonstration of CINDE, a digital analytic assistant designed to receive natural language input from users and provide conversational answers.  CINDE is an acronym for Conversational INsights and Decision Engine and can provide answers to questions through use of deep analytics, data mining and immersive visualization into stores at department, planogram, and product level. Because of this contextual intelligence, CINDE serves information using the most appropriate visualizations to give holistic insights for actions that can or should be taken.

Information from CINDE is specific to the user, meaning it knows if you’re a category manager, and it’s also able to sort the messages in order of those that will have the most impact to the top line first. The natural language was also a big part of the development. This is why it’s called “conversational insights,” it’s important users aren’t left to interpret the graphs and charts. The push model CINDE Finds tells users what she found in natural language that is clearly understandable and presented via mobile.

The AI shortens the time needed to make decisions by both presenting the user with an issue and making a recommendation. The user just needs to review and choose an action.

Another benefit is that category managers can have all of the data information at their fingertips for a meeting or store visit. If they have a desk of a few categories they will get sales totals and category breakdowns.

Information from CINDE can be specific to the store, or across all the stores. Users can take customer behavior and analysis down to a single store to even get a localized view of shopper behavior.

Information from CINDE can be specific to the store, or across all the stores.

Additionally, to validate things like new product introduction or explore different store lighting options, Symphony RetailAI can offer virtual shopping tests that can measure both a survey takers conscious survey response and facial response for arousal and variance factors in real time. People 3D walk around a store on a standard computer. There is also a solution to help with planogram compliance through mobile photos using image recognition. The store will get information on what to do to correct compliance issues, such as moving an item. Robots, fixed shelf cameras or mobile photos can take the shelf photos.

Eric Le Blanc, Tyson Foods, Opens Day Two

Eric Le Blanc, Director of Marketing, Deli, Tyson Foods, presented the second day’s keynote, “Educate and inspire to make critical connections with shoppers.” Le Blanc showed how Tyson Foods approached the challenge of uncovering the deep, unarticulated needs of shoppers to then be meet them in way that is relevant, growing satisfaction and loyalty. He explained that they found many people didn’t know what they were having for dinner at 4 p.m., but that wasn’t a bad thing. Only 4% identified that as stressful. They found only 5% of shoppers seek advice in the store, but 89% asking advice took it.

“We use a lot of buzz words and it masquerades as thought….It’s important we challenge those words because they obscure our ability to see deeply what is going on.”

To this end, Tyson brought in though leaders from other industries. Common observations emerged from participants. For example, they observed limited staff engagement and shopping with children wasn’t easy, among other things. They found, with an unnamed retailer, that thoughtful messaging online made an impact. This Olive was developed by Tyson to provide recipes and tips in the store or online, and Olive sends data to the retailer. Tyson said 79% said they felt more knowledgeable about the deli after engaging with Olive, when they did testing with the unit.

He urged that retailers understand what really motives the shopper; it’s probably not rational. To market on a human scale, stop trying to manipulate the consumer and try to be a trusted advisor.

“If we address the motives and solve the issues really there, we have the opportunity to develop a transformational relationship."

Marty Siewert, Global Director Shopper Insights, Anheuser-Busch InBev

Marty Siewert, Global Director Shopper Insights, Anheuser-Busch InBev, presented “Develop the right product: Research, analysis & validated shopper insights.”

One of the largest global FMCG companies, Anheuser-Busch InBev has a massive global customer base. But with that expansive customer reach comes a heavy responsibility to understand how their shoppers shop - and what they want. And the average number of beer skus being managed has gone from around 200 to 1,000.

Anheuser-Busch InBev initiated an advanced customer behavioral research project with Symphony RetailAI that tracked customer path to purchase information and gained sophisticated insights that helped them improve a product to give customers exactly what they want. Siewert took the audience through the study that helped them make a significant modification to one of its global beer brands – Natural Light.  The study led to 2 skus in the hard seltzer category and Naturdays. A 77 can variety pack came out of it. Naturdays is on track to be a $50 million introduction this year. The key takeaway was that people in the value segment want choice just as much as those in the premium category.

Siewert also noted having video ethnographies and shoppers intercepts helped them with an additional study around package innovation. The ethnographies provided rich customer insights. “Shoppers don’t always tell you why they do what they do,” he said.  A cross-functional roadmap was key to staying on track.

Katie Waeltz, Senior Director of Shopper Insights and Analytics, Topco Associates

In a second day breakout out session, Katie Waeltz, Senior Director of Shopper Insights and Analytics for Topco Associates, LLC, presented “Driving broad insights into action via customer data.” Her focus on customer-centricity is central to her team’s work at Topco through integration of customer insights into Category Business Plans, Assortment Recommendations, Own Brand Strategy, and Innovation measurement. Waeltz talked about how Topco utilizes their member retailers’ loyalty card data to craft actionable plans of attack.

She showed how product, place, price and promotion tactics can be gleaned based on an understanding of customer behaviors within the store, using a look at bath tissue as a case study. Results brought about strategies, such as showing the bath tissue options were overwhelming, which led to recommending to test getting out of some of the brands. But they backed up this idea with data.

Following, Misty Deskins, Director Loyalty Marketing, K-VA-T Food Stores; Lindsay Meucci, Director Marketing Giant Eagle; and Loren Splawn, Senior Director, CRM Symphony RetailAI presented a Q&A panel on “Personalized marketing best practices to drive sales and CPG engagement.” Personalized marketing can be thought of as the action that retailers take after discovering the continuum of subtle and obvious insights in their customer data. These retail marketing practitioners answered questions around personalized marketing strategy, campaigns, collaboration with merchandising and CPGs, as well as key performance metrics. Meucci talked about how Giant Eagle has a suite of targeted marketing solutions. The retailer is also starting a pilot to drive customers to be digitally engaged with them, including strategic offers. Deskins talked about how shoppers can text to save offers, if there are issues around digital coupons. She also noted they’ve learned specific amounts to offer shoppers depending on if they want to reward or acquire.

The closing panel was hosted by Brian Kilcourse, RSR Research, and included EnsembleIQ’s own Mike Troy of Retail Leader, Alicia Samuel of Longo’s, Rebecca Bello of InContext Solutions, and Rick Fink of Heinen's

The closing panel, “Winning secrets for the retail value chain” hosted by Brian Kilcourse, RSR Research, included EnsembleIQ’s own Mike Troy of Retail Leader, Alicia Samuel of Longo’s, Rebecca Bello of InContext Solutions, and Rick Fink of Heinen's Fine Foods.

Samuel and Fink talked about engaging the customer in the store, whether from a class or in-store dining (or 150 wines on tap). Troy spoke to “format flexibility” as a trend for retail stores. Bello followed by noting testing helps retailers decide what strategy is best and how to keep ahead of trends. 

Samuel talked about how they rely on their category managers and their tools for assortment and they are looking at how they can do this even better with additional technology tools. She noted they are also working on building out a customer data platform to connect their data in a way that works for their marketing teams. “This is where AI also comes in, in order to get insights out of this data,” she notes. Fink also says that the retailer has all the data, but it’s “so much to get your arms around.” He notes, “you have to be agile.”

The show ended with a lunch in the Innovation Zone, where attendees were able to network and recap insights gleaned from the two days.