Developing a Perfect Store Strategy in 2022
In 2022, the perfect store is rooted in constant evolution — a system that maybe isn’t perfect in every moment, but is agile always, malleable when needed, and capable of critical self-reflection. These innate characteristics of the modern perfect store are supported by, and in return support, the adoption of a few important technologies and strategies.
Getting Eyes on the Shelf
In 2022, manual data collection is an archaic practice. By the time it's reported and analyzed, it has become obsolete. To remain agile and adapt to store conditions in a timely manner, brands and retailers need access to the current state of the shelf. This is where image recognition (IR) comes in.
CPGs can gain “eyes” in-store and automate the collection of near real-time data by capturing images of the shelves through Internet of Things (IoT) devices or field teams empowered with on-device IR-powered applications. Incorporating this type of technology provides insight into key performance indicators such as share of shelf, out-of-stocks, on-shelf availability and product positions, allowing for easy measurement in comparison to perfect store standards.
Making Smarter Decisions Using AI and ML
While IR acts as a solution to the issue of timely data collection, it also presents a challenge: how to efficiently analyze the mass influx of data. The accuracy and timeliness of the numbers only matters if companies are able to make sense of them — applying the trends to strategy development and key decision making — while standing in front of the shelf.
With the introduction of automated data collection comes the need for analysis through artificial intelligence (AI) and machine learning (ML). Instead of manually sorting through endless spreadsheets over a long period of time, CPGs can turn to AI and ML technology to extract the high-level insights and next-best actions the numbers represent. This presents the opportunity to make corrections to the shelf in near real time.
Leveraging a Dynamic Workforce to Execute Where it Matters
Even with technology identifying how and where brands should act based on shelf data, there's still the challenge of who will execute these resulting tasks. Compounded by ongoing labor shortages and tight margins in retail, shelf visibility and general brand merchandising are falling more on the brand teams than ever before.
The solution is to go beyond the traditional workforce and toward a more dynamic option. By leveraging a gig workforce, brands can hire motivated, qualified individuals to enact product-focused operations on-demand in stores across the country. Embracing this gig workforce allows for greater personalization and faster action when it comes to key perfect store elements such as in-store activations.
Reimagining the Shopper Experience in Partnership With Retailers
Overall, the perfect store reflects a positive and mutually beneficial relationship between CPG brands and retailers. And at the epicenter of that Venn diagram is shoppers. Focusing in on, and continually evolving, the shopper experience should be a priority for everyone involved. For example, activations and other customized experience initiatives provide an opportunity for CPGs to drive trial of their products, while also positively impacting retailers’ in-store operations.
The perfect store is never stagnant or complacent; there's always room for improvement. However, by focusing on key concepts like timely data collection, effective analysis yielding immediate action items, deploying a flexible workforce, and prioritizing the shopper experience, stores and CPG brands can work together to come as close to perfect as possible.
Dor Sela is the head of strategy at Trax, the driving force of the store of the future.
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Dor Sela is the Chief Marketing Officer and Head of Strategy at Trax.
Dor has over 20 years of experience in senior leadership positions within the FMCG and Retail industries. Starting his career in 1998 at Procter & Gamble, he took on various Marketing positions in Switzerland, Israel and South Africa and grew to become the Marketing Director. Dor has also worked with Reckitt Benckiser as General Manager – Near East – based in Israel before joining Carrefour Paris as Executive Committee Director for Carrefour Branded Products. In 2013, he took the role of Executive Vice President – Head of Global Consumer Marketing within MasterCard in New York.
Since 2015, Dor was Chief Executive Officer of Kahn Lucas Lancaster in New York and managed the transformation of this company into the leading ‘tween’ fashion branded company in the US.