Apptus Blog

Automated Merchandising – Why you’d be mad not to!

Written by Apptus | Oct 6, 2016

Andrew Fowler, UK Country Manager at Apptus, examines the spectre of automated merchandising and tries to reassure us that there is nothing to worry about – no seriously, you’ll be fine!

The double-edged sword

Since the industrial revolution, automation in the workplace has been met with extreme reactions. As a business owner, you would rub your hands in glee as you realised you could punch out more widgets, more quickly while employing fewer people.

However, if fate had dealt you a different hand, you'd be quaking in in your boots as you realised your widget making skills were no longer required and unemployment beckoned.

Retail automation

Retail, though, has seen remarkably few significant step changes when it comes to automation. And understandably; buy products, display them attractively, take the money, count it, bank it and repeat. OK, an oversimplification I grant you, but you get the point. There are some, though: Cash registers and subsequent EPOS systems have removed the need for a counting house and in store bookkeepers. Automated warehouses, such as Benetton's, allowed robots to pick and pack. Self-serve

There are some, though:

  • Cash registers and subsequent EPOS systems have removed the need for a counting house and in store bookkeepers.
  • Automated warehouses, such as Benetton's, allowed robots to pick and pack.
  • Self-serve tills have reduced the need to have checkout staff.
  • The internet – enough said!

A dystopian future?

During October last year, Gartner published a number of predictions for the following twenty-four months that, on the face of it, signalled a distinctly dystopian future.  These included, inter alia, the predictions that by 2018:

  • 20 percent of business content will be authored by machines;
  • Over 3 million workers globally will be supervised by a "Robo-Boss";
  • 2 million employees will be required to wear health and fitness tracking devices as a condition of employment.

So if you are in middle management, or you're a copywriter – is the writing on the wall?

Not really.

The reality is the technologies that feed these predictions are really just taking the grunt work out the job and adding levels of safety:

  • Automated composition machines will produce analytical information in written natural language, which is potentially useful for shareholder reports and budgets. This frees up writers to focus on the creative stuff. Fun.
  • The "Robo-Boss" will be a glorified clocking in the system that deals with 'bulk management' tasks requiring little in the way of personal intervention.
  • The health trackers will tell us that an airline pilot is about to have a stroke, or a military recruit is being pushed too far, they will save lives.

The eCommerce merchandising challenge

Merchandising is the selection, placement and presentation of products that makes the best use of the space available – you will consider profitability, inventory, brand promotions and current marketing campaigns.

When you rely solely on bricks and mortar, merchandising is constrained by the amount of space available to display product. Visual merchandisers work their magic to make displays attractive and commercial, but depending on the depth of the product range, something has to take a back seat and languish in the stock room.

In order to display more products, you can produce a catalogue that dramatically expands the number of products on offer.

But the position with an eCommerce site is interestingly paradoxical: On the one hand, the ability to display an endless number of products is only constrained by the capacity of your database – millions. On the other hand, a shopper can only view one screen at a time. You cannot flick through a website in the same way you can flick through a catalogue, so what comes up on screen needs to be highly relevant.

Merchandising - a new reality

For retailers with large product ranges is it is physically impossible to manually merchandise every product and line. The dynamic nature of websites means a home page, or the shop window, can vary according to who is visiting and where they come from. Furthermore, most website visitors do not arrive at the front door – how do you prioritise?

The answer is by automating the process. Or rather by automating a large proportion of the product exposure process.

Online Merchandisers will not need to seek new employment; rather they will be freed up to do the creative stuff, to deal with the merchandising anomalies that even a sophisticated algorithm cannot tackle.

What’s in it for me?

There are five reasons why as an owner of a large e-commerce site you should consider automating your online merchandising:

  • Save time and time is money
  • Increase CTR
  • Expose more products to more people
  • More productive staff
  • Reduce down selling

With benefits like that, you'd be mad not to!