Dive Brief:
- Heinen’s, a Cleveland-based grocer with 23 stores in Ohio and Illinois, will deploy a cloud-based machine-learning solution next month that will help it identify missed sales opportunities, reports Supermarket News.
- Using pre-existing point-of-sale data, the software, developed by technology firm CB4, detects unmet demand opportunities in stores resulting from operational issues that affect product sales down to the SKU level, along with the impact of local demand.
- These findings are translated into actionable recommendations and sent to store managers or other relevant executives with guidance on how to capture lost sales and improve customer experience by correcting the issue, according to a press release. Implementation will only take a few days because the software does not require in-store hardware or external data sources.
Dive Insight:
Heinen's is not known for being on the cutting edge of technology. But deploying artificial intelligence should actually help the regional grocer, which operates 19 stores in the Cleveland area and four in the Chicago vicinity, better offer the customer service it's been trading on for years.
AI is not a cure-all for grocers. When used in targeted ways, however, it can save a lot of time for workers, freeing them up to do what they do best. Heinen's employees can spend countless hours trying to identify missed sales opportunities. But by letting machine learning software comb through the data instead, the grocer saves time and increases accuracy.
The CB4 software identifies patterns for high-demand SKUs, according to Supermarket News. When a product is found that is not selling at expected levels, the machine-learning solution cites the most probable operational issue to have caused the gap in demand, and reports it to store management.
This is good news for a company where the emphasis is on personal service. Heinen’s operates at the mid-to-high-end of the supermarket spectrum having developed a loyal customer following which allows it to compete effectively with Giant Eagle, Walmart and Whole Foods Market. Its center store products are priced competitively, while its service departments are highly regarded locally. Heinen’s recently expanded into the Chicago market and has opened a unique store in the center of Cleveland’s downtown business district in a landmark abandoned bank building.
AI and machine learning are still in their infancy among supermarkets, but the use is expanding. Harps Food Stores is using AI software for pricing and promotions decision making. Earth Fare has found that an AI-powered circular has helped it understand consumer demand and boost sales. Bell’s Food Store in Athens, Georgia — like Heinen’s — seeks to improve its inventory consistency, but is doing it with a shelf-scanning robot for store shelf analytics and insight.
In the broader scope of retailing, about 54% of companies surveyed by e-commerce solutions firm SLI Systems said that they already use or plan to add artificial intelligence technology in the future, while 20% expect to add AI within the next 12 months.
