When the artificial intelligence streamlines the use of the clients, it is the management of stocks is boosted.
The French start-up Ysance has the wind in its sails. Founded in 2005, with 120 customers, this marketing specialist “people-based” and the management data is associated in march 2017 with the editor of logistics solutions Vekia, to bring artificial intelligence and control inventory. Interview with its CEO Laurent Letourmy.
artificial Intelligence on one side, management of the stocks of the other. What is the relationship between these two worlds ?
there are two key elements in the field of stocks at the major retailers (retail). First, a huge volume of information, of references, of products in circulation… Second, the purchase patterns of customers. There are sharp recurrences and similarities that leave very little to chance – we bought the air conditioner if it is hot, objects the athletes for the summer, to cite the obvious cases.
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so far, the forecasts were carried out mainly by the man who crossed these data, on the basis of his experience, his knowledge, his intuition, to manage inventory. Today, there are algorithms capable of quickly process huge volumes of data.
They are able, from the analysis of the path to purchase past to predict the behaviour of the consumers the products that will be sold tomorrow, online and in-store. They also know to learn their predictions – strengthening those that are correct, rework the other.
What are the practical applications for the control of stocks ?
The retail is a business flow. As long as a product is in a warehouse, it costs money. Conversely, if it is not there and that the client arrives, on the one hand it don’t buy it, and on the other hand, at the time of Amazon and immediacy, he will look elsewhere and may not return.
The analysis algorithms of the data means that, for each product, with phenomenal precision – how much to order, where and when. There is a gain in term of management of the storage space, and therefore cost, but also sales and customer satisfaction.
beyond stocks, this analysis allows us also to predict the number of vendors that it will take at a particular moment in a store, anticipate the products that need to be put in promotion…
Recently, one of our customers proposed a garment in three colors, blue, red, and white. He noticed that the white was out of stock every Thursday at noon. However, if he had analyzed the behavior of customers on its website a few weeks upstream, he would have been able to foresee this craze, and calibrate its production and inventory based. He would have won, according to his calculations, 50 million euros turnover.
When we think of this type of solutions, the name of Amazon comes up often… is it to walk in his steps?
Amazon’s been doing it since the first day. This company had no choice: she has built a business of retail world without encountering a physical client!
It is based on the knowledge of buyers, from their online behaviour, by working on the data and the algorithms. One of the first things that has distinguished itself, it is its recommendation engine – that is to say, an algorithm on the data. And its logistics, is its strength, nourishes itself from these data.
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This is a new equation of the trade: use the data for further prediction and customer satisfaction. Conversely, the physical retailers rub shoulders with customers on a daily basis, but do not know that much.