A Picture Tells a Thousand Words: How Image Recognition is Changing the Game in Retail

Retail execution, from “mom-and-pop shops” to mass retailers, has operated with a simple goal in mind: keep products on the shelf and customers satisfied. However, the methods to achieve this goal have undergone a dramatic transformation. What used to be manual processes — literally pen to paper — have evolved into sophisticated systems that leverage cutting-edge technologies. Today, CPG manufacturers and retailers can utilize digital solutions like artificial intelligence-driven image recognition (IR) to meet their retail execution goals. These in-store strategies increase sales, make brands more visible, and create memorable customer experiences. They're more than just “buzzwords”; AI technologies are changing the future of retail.

Image recognition (IR) has been a game-changer in retail execution. By analyzing visual data with the help of AI, IR can identify and interpret in-store conditions (product, categories, displays, pricing, etc.) by looking at images. Solutions can capture real-time images of shelf conditions, and brands can use that data to make better informed in-store decisions. This technology gives brands near real-time visibility at the shelf level, SKU level, category level, store level and more, making it easier to see that products are correctly stocked, displayed, priced and maintained, improving the shopper experience. This not only provides a competitive advantage against brands that lack this visibility, but it also sets clear key performance indicators for brands to measure themselves against competitors.

Despite these advancements, retailers and brands still face significant challenges. Stores continue to struggle to find enough staff post-pandemic, which makes managing inventory and merchandising products difficult. Often fewer workers result in undertrained staff, and mistakes like misplacing products, not replenishing products on shelves, or not keeping an accurate inventory log are more likely to occur. For brands, these inconsistencies mean a lack of visibility at the store and SKU level, making it hard to track sales performance and identify out-of-stocks (OOS) promptly. Without this information, brands can’t react as quickly to market changes, which impacts overall sales and customer satisfaction.

AI technologies, including IR, are key to overcoming these hurdles within an organization — both for retailers and the brands they sell. In-store, retailers can offload routine tasks such as stock checks and shelf audits, enabling employees to focus on high-value activities such as customer service rather than being bogged down by manual inventory inspections. For brands, IR bridges the gap between the brand to the store. Image recognition isn’t just about real-time insights. It provides the ability to make informed decisions across the entire organization. When done correctly, it can impact perfect store execution, category management, supply chain performance, marketing, branding, advertising, and more.

IR is revolutionizing the future of retail execution and ushering in a new era of brick-and-mortar. It provides brands real-time insights into inventory and product placement and empowers store workers to focus on customer service. AI is pivotal to the constantly changing needs of today’s retailers. As part of the AI revolution, IR is the cornerstone of modern retail execution, making sure that stores are not only efficient but well-equipped to address today’s ever-changing retail landscape. The future of retail is here and it's powered by intelligent, data-driven solutions that put the customer experience first and is ready to adapt to whatever future challenges arise.

David Gottlieb is chief revenue officer at Trax, a leading innovator in data and technology reshaping the retail landscape.