The Supply Side: Retailers innovate in-store execution for post-pandemic shopping

Retailers scrambled to use and improve technology during the pandemic as more sales migrated online. Now, startups focus on helping with better in-store execution, according to Scott Benedict, an adviser with retail consultant McMillanDoolittle.

He said technology investments primarily focus on supply chain or digital retail changes. Still, as more shoppers return to brick-and-mortar in a post-pandemic world, the spotlight is returning to in-store execution.

Keith Fix, CEO of Retail Aware, said the company uses sensors made in Malaysia and assembled in Omaha, Neb., that capture data from on-the-shelf displays. The patented technology can collect data without having to use cameras. The sensors capture shoppers’ movement to record how long they dwell and how they engage with the product. The sensors on push racks can also track when the product is running low and notify the brand or retailer before the out-of-stock occurs.

Fix said consumer brand manufacturers can spend a lot of money on in-store marketing and displays without any data. Comparable spending online gets them granular consumer data that has yet to be available for in-store commerce.

Retail Aware has deployed more than 10,000 sensors at thousands of retail locations that capture real-time data and send it to the cloud, where it is analyzed for insights. Fix said the company has worked with electronics, consumer food and beverage brands to understand sales data better. He said brands have typically had to rely on point-of-sales data or broad category data from Neilsen or IRI. Fix said this is like getting a child’s report card without a parent/teacher conference.

He said the sensors provide granular data to the supplier about their product’s performance in a particular store. Retail Aware worked with a large beverage company that saw out-of-stock items more than double the average rate in some stores. He said that with the granular data, the brand can better shift inventory to where the demand dictates.

Fix is based in Chicago but said he spends about half his time in Northwest Arkansas with an office at Ledger in Bentonville. He wants to eventually move some production to Northwest Arkansas as the company grows. The company officially launched in 2019 and first worked with a large regional grocery store chain to use the sensors to track inventory at the shelf better, improve loss prevention and get a better sense of shopper behavior in stores.

He said there are several ways to improve in-store execution, including smart labels, smart shelves, robots that scan inventory, RFID at the shelf and beacons. Fix said sensors that record shopper data in real-time also have a place in the stores.

“What Keith Fix and Retail Aware are doing to engage at the shelf level feels like where technology insights on consumer behavior make so much sense for brands and retailers,” Benedict said. “It’s also a cost-effective way to get real-time data without disrupting the shopping experience. Brands can better understand what is happening with in-store displays and adjust as needed.”

Rick West, CEO and co-founder of Fayetteville-based Field Agent, has worked with suppliers and brands on shelf visibility for more than a decade. But the tech firm recently partnered with Shelfgram on a new product venture dubbed Retail Pipeline.

Field Agent utilizes a crowdsourced panel of more than 2 million shoppers via its smartphone app. It captures photos of every four feet of the main aisles and stands along secondary displays in stores daily. The new collaboration with Shelfgram takes the images and transforms them into a planogram view, incorporating advanced AI and heatmap technology. The combination provides a holistic understanding of retail execution, allowing brands and retailers to make informed real-time decisions.

“From a laptop, leaders in the retail industry can virtually fly across the country to see what their shoppers are seeing,” said Bram Warshafsky, founder of Shelfgram. “Gone are the days of getting POS data and wondering why market share swings up or down. With this platform, people can time travel and understand the causal drivers behind sales figures.”

West said Retail Pipeline allows a supplier to take a virtual store walk and look at their products at the shelf level at any time. He said Retail Pipeline would show competitor information across thousands of stores in real-time and provide a historical perspective over the past few years.

He said suppliers who use Retail Pipeline can see price changes, understand out-of-stock, and gain insights about how people look at the category and how long they spend with the products on the shelf. One advantage of Retail Pipeline is the scale at which it can be deployed.

“When a supplier can see all the product it has in retail at the shelf level across thousands of stores without ever leaving their office, that’s a game changer,” West said.

He said the granular view and insights at scale were only feasible with improvements in enhanced AI in recent years. West said the big data furnished by IRI or Nielsen needs to be drilled down to store- and product-level performance. West said many smaller, niche suppliers also can’t afford to purchase that big data.

“Retail Pipeline costs about 10 to 20 cents on the dollar compared to the big data price tags,” West said.

He said product users could pull up the app during a call with their buyer and see what was happening in a particular store. He said a supplier, for example, could tell a buyer a new product is taking share at a competitor during a meeting.

“We are excited about Retail Pipeline and the impact it will have on improving in-store execution as brands and retailers can see consumer behavior at the shelf,” West said.

Editor’s note: The Supply Side section of Talk Business & Politics focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by Talk Business & Politics and sponsored by Firebend.