Morning Brew - ☕ Checked out

Camera-powered stores are enabling checkout-free shopping
Morning Brew September 12, 2022

Retail Brew

Wunderkind

Welcome to Monday. Along with “pumpkin spice,” the lexicographers at Merriam-Webster just added another one of our favorites, “shrinkflation,” to their dictionary. Speaking of which, we hope no one notices the newsletter is 6% smaller today.

In today’s edition:

—Maeve Allsup, Kelsey Sutton

STORES

On camera

109 cameras enable autonomous shopping in a convenience store in Silicon Valley. AiFi

Silicon Valley startup AiFi (pronounced like “wi-fi”) is the driving force behind no fewer than 86 “computer-vision powered” autonomous stores in North America, Asia, Europe, and the Middle East.

Retail Brew visited an AiFi-powered Loop Neighborhood Market in Union City, California, which also serves as the company’s Bay Area “lab,” where they test out product updates and ideas. AiFi’s chief technology officer, João Diogo Falcão, said he believes that what makes AiFi stand out is the simplicity of implementation for retailers.

The company’s camera-powered model means stores can retain their physical setup when they make the transition to autonomous checkout. AFi’s artificial intelligence provides retailers with a better understanding of human behavior in brick-and-mortar stores by collecting data typically associated with e-commerce, Falcão said.

  • Retailers can track how much time shoppers spend in certain aisles, which products they pick up and then put back, and basket-size trends.
  • It also helps them mitigate labor challenges, and allows 24/7 shopping, which the company claims helped Polish convenience-store chain Zabka increase sales by up to 40%.

Autonomous checkout in practice

At eye-level, the Loop store we visited looks like any other convenience store—froyo and slushie machines, wall-to-wall beverage cases, and Loop’s orange-and-white branding at every turn. It’s not until a shopper looks up that they can see evidence of the store’s autonomous capabilities in the form of 109 ceiling-mounted cameras.

  • According to Falcão, the top differentiator of AiFi’s camera-only model (as opposed to using sensors or other technologies) is that in addition to allowing retailers to keep their optimized setup, the in-store experience is a familiar one for shoppers.

Keep reading here.MA

        

TOGETHER WITH WUNDERKIND

Get the 411 on successful SMS marketing

Wunderkind

Text message marketing is one of the fastest-growing—and most successful—revenue channels in the game. That means you can’t afford to say TTYL to SMS anytime soon.

For a play-by-play on how to leverage the art of texting strategically, check out Wunderkind’s Text Message Marketing Playbook.

This handy guide provides real-world examples of top brands utilizing Wunderkind’s performance marketing engine to turn texts into a bustling revenue channel. SMS will be your brand’s new BFF before you know it.

Learn how to organize a message cadence strategy, develop and grow your subscriber list, power your messaging based on subscriber engagement, and see what’s next with texts.

Download your free copy here.

        

MARKETING

You had to be there

Details from a pop-up activation for the Hulu series 'Only Murders in the Building,' including photos of potential suspects on a corkboard, a puzzle with a missing piece, and cards from a fictional card game Son of Sam. Kelsey Sutton

Some agency executives aim to capture the same kind of amusement-park magic on a smaller scale with pop-ups, reports Kelsey Sutton for Marketing Brew:

Like theme parks, entertainment properties that already have built-in fan bases are well-suited for in-person installations, Simons said. But unlike theme parks, pop-up installations—which can sometimes take months to build—are relatively short-lived, often only accessible during events like Comic Con or South By Southwest, or over the span of a weekend.
That means brands are tasked with getting people excited fast, which they can try to do through press coverage and by designing pop-ups that are photogenic and easily shared.

Keep reading here.—KS

        

TOGETHER WITH NORTHBEAM

Northbeam

Supercharge your digital ad performance. To spend confidently—and grow profitably—you need to know which metrics, KPIs, and signals drive $$$ growth with advertising. No need to sift through the stats: Northbeam’s first-party data, cutting-edge machine-learning models, and AI-driven analytics can spotlight the funnels that can take your biz to new heights. Try it here.

        

SWAPPING SKUS

Today’s top retail reads.

Not cooking without gas: The gas shortage in Europe, linked to Russia’s war on Ukraine, is hurting European manufacturing of products as far-flung as sugar and toilet paper. (the Wall Street Journal)

Bottle-neck: Why baby formula is still facing supply shortages. (the New York Times)

Everywear: At New York Fashion Week, menswear is moving further into gender-neutral looks. “The idea is to design the best product, think about the differences in body types and design it to be fluid,” Michael Kerr, Nobis’s senior design director, explained. “We like to say ‘genderless.’” (Business of Fashion)

Learn: You’ve got the ideas, the drive, and the dream—and the Brew’s Leadership Accelerator can teach you how to get your boss on your side. Join our September cohort now.

Share a little: Take this quick survey to help us deliver the best content possible—and be entered for a chance to win a $500 AmEx gift card.*

*This is sponsored advertising content.

RETAILERS: THE CLOCK IS TICKING

Don’t forget! The SKU: A Retail Brew Summit is coming to NYC this fall. Join a community of corporate retail leaders for a day of networking and insightful conversation about meeting demand and maximizing profit, using technology to drive sales, sustainability, and more. Tickets are only $599 for a limited time!

Register now

WHAT ELSE IS BREWING

  • Kroger introduced a new budget private label, Smart Way, and posted a sales increase of 9.3% YoY for Q2.
  • Credit-card companies will establish a new merchant code for gun dealers, a move lauded by gun-control advocates and opposed by the NRA.
  • Burger King will spend a whoppering $400 million over the next two years on renovating restaurants and marketing.
  • A possible rail strike could deal another blow to the US supply chain this week.
  • Monarchy-related souvenir sales are spiking in England following Queen Elizabeth’s death.

HOT TOPIC

At the mall, it’s where band tees are the only tees. In Retail Brew, it’s where we invite readers to weigh in on a trending retail topic.

On Labor Day, California Governor Gavin Newsom signed the Fast Food Accountability and Standards Recovery Act into law. The bill, which had passed in the California legislature a week earlier, had faced opposition from industry groups and some restaurants, including one that really was not lovin’ it. Joe Erlinger, president of McDonald’s USA, called it “lopsided, hypocritical, and ill-considered” in a statement posted on the company’s website after the law passed.

The law establishes a panel that includes workers, union representatives, and employers. The panel will establish industry-wide standards on working hours, and safety for fast-food restaurant workers and will set a fast-food worker minimum wage to as high as $22 next year.

Or will it?

Two days after the governor signed the bill, a coalition of opponents, including the International Franchise Association and the National Restaurant Association, announced they were beginning an effort to put a referendum before voters to overturn the law.

You tell us: Whether you’re a resident of California or not, what would you do if your favorite fast-food restaurant publicly supported the ballot effort there to overturn the new law aimed at improving standards for fast-food employees?

Circling back: Last time, even though we think you’re beautiful just the way you are, we asked how rising costs have affected what beauty products you buy. After all, some consumers have been shifting to more affordably priced private-label beauty brands.

  • About 6.8% of sales at Sephora came from private-label beauty, in the year ending June 2022, per 1010data.
  • While overall online beauty sales at Sephora and Ulta slumped 25.5% between April and December 2020, private-label Sephora Collection and Ulta brand items rose at 0.5%.

We asked how you were dealing with rising costs when it comes to beauty products, and 40% said you’ve stopped buying certain beauty products, 35% said your beauty-purchasing behaviors haven’t been impacted at all, and 25% have been trading down to private-label for some products.

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Written by Maeve Allsup and Kelsey Sutton

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