Price pressure and low margins are weighing heavily on retail – learn more on a proven way for grocers and drugstores to escape this pressure.
Learn how to increase your redemptions while at the same time drastically reduce discounts.
Mass promotions still dominate the everyday shopping experience in retail, even though today’s consumers are used to online marketing and have come to expect personalization. Instead, they get promotional offers for products they would have bought anyway or might not like at all. Consumers’ practical needs and their interest in new product categories are neglected.
As a result, retailers are seeing promotions increasingly lose their impact. Oftentimes, low redemption rates and negative margins go hand in hand. In addition, retailers frequently fail to understand their customers’ specific needs and preferences and thereby fall short of establishing a meaningful 1:1 connection and improving customer loyalty. Not surprisingly, market research has shown that globally, 59% of mass promotions do not reach the break-even point.
These problems and the ever-increasing price pressure call for a novel approach to promotion: one that truly understands what the consumer wants as well as what benefits the retailer. One that delivers relevant promotions and also increases basket size. Segment of One artificial intelligence, the SO1 Engine, is one answer to these challenges that is receiving increasing attention from retailers, solution providers and media alike.
The SO1 Engine harnesses the hidden information in consumers’ basket data and predicts each consumer’s preferences and willingness-to-pay for a potential promotion product. It does so automatically and in real time – serving all possible channels from apps, messengers and emails to check-out-couponing, while ensuring that each customer receives an individual offer composition with individually adjusted discounts on the right products, at the right time. The whitepaper ‘Nine reasons for individualized promotions based on artificial intelligence’, will explore important advantages to retailers when applying artificial intelligence (AI) to their promotion activities, with examples based on real-life data from grocery retailers and drugstores.
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