What is Image recognition?
Image recognition is a term related to computer technologies that recognize certain images, shapes, objects, animals, and so forth products through algorithms or machine learning processes. It is very well linked to computer vision which enables the computer to see an object as the human does by the process of image-processing.
The image recognition market size is projected to grow from USD 26.0 billion in 2020 to USD 53.0 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 15.1% during the forecast period.
In the retail world, image recognition is used by CPGs as a productivity tool to enable faster audits, high accuracy and boosted efficiency.
Consumer brands have always struggled due to their variability of products and their sizes and compositions. Due to which it becomes unlikely to have one plan for the whole store display. Thus it is acceptable that there will always be some disconnect between their planogram and display. FMCG and CPG manufacturers are constantly challenged to track in real-time hundreds of SKU assortments per category per segment across thousands of stores which is not so simple.
And while a well-implemented in-store strategy can set your customer experience apart, the hard reality is that poor retail execution is responsible for 25% of lost sales. Although this bridge can also be covered with image recognition by tracking their in-store KPIs which yield better results, are more efficient, and are accessible to a wider customer base.
image recognition could help CPG in tracking:
- On-Shelf Availability
- SKU Presence
- Stock Levels by Threshold
- On-Shelf Visibility
- Number of Facings
- Share of Shelf
- Planogram Compliance
- Assortment Compliance
- Promotion Compliance
- Number of Displays
Image recognition(IR) does not limit itself to in-store strategies, rather it extends itself to analytics. IR has been a propitious medium to keep tabs on the competitors and their activities. For any retail sector ranging from consumer goods to fashion to grocery to consumer electronics, it becomes of integral importance.
It becomes indispensable for any business to evaluate its competitors’ markers. Thus IR comes into play and has become pivotal in the retail industry since then. The process is called Competitive analysis.
What is competitive analysis?
Competitive Analytics advises and develops analytical workflows for successful retail companies empowering them to understand their competitive environment, enhance their predictive modelling capabilities and target customers with the highest lifetime value by deploying advanced retail analytics.
Get competitive insights on how your display, promotional, and pricing strategies stack up against competitors in-store strategies
Various goals can be achieved through competitive analysis:
- improve sales performance
- analyze profitable customer segments
- increase customer loyalty
- create efficient manufacturing strategies
- monitor and make decisions based on store traffic trends
- powerful customer insight
- develop strategies for targeted interactions with current and potential customers
- Improve brand perceptions
The human brain can process images that the eye sees in just 13 milliseconds, the first evidence of such a fast processing speed.
It is believed that many times when consumers find the out-of-the stock situations at retail stores which leaves them with four alternatives:
- Go buy from a neighbouring competitor
- Go and buy the same product from a different chain
- Buy online
- Or halt for some time and buy during the next purchase.
Steps involved in competitive analysis
- Identification of present and future competitors
The best way to identify the competitors is through analyzing the targeted product. This allows you to examine the branded and unbranded companies that are in the same product line.
- Finding and analysis of the market share
It is not plausible to know your competition’s strengths and weaknesses until you know their presence. In addition, you can also search a supermarket to find the reason why your competition is selling. Is it sold because it is easily available, the quality is high or the price is low? This step will help you perform a SWOT.
- Competitor’s Pricing
Pricing has been a vital concept while analysing competitors as for a majority of customers, the price of the commodity is a paramount basis while shopping. The range of products under a certain price band and pricing across various retail outlets needs to be determined for an unerring competitive analysis.
- Performing SWOT analysis
SWOT analysis is needed to determine the strengths and weaknesses of the competitors to get the trigger points that can benefit you and your store. Once the share of the market is received the next step is the primary and secondary SWOT analysis. Every brand needs a benchmark to move forward and undermine the strategies of its competitors to get ahead.
- Customer behaviour patterns
Customers are the recipient of your products and strategies implemented. Customer satisfaction always gives better insights into how a business is doing. Analyzing your business also comes under competitive analysis.
Image recognition and competitive analysis
- Image recognition helps in identifying the SKU’s through the shelf facing, which in turn helps the brands to get insights and details on how much of its product is selling and under which retail store.
- Image recognition makes it effortless and facile in determining the key performing indicators. So that in future the brands can start working upon them and extract outgrowth.
- It is an uncomplicated process wherein you just need to click a picture of the requisite SKU and it pans out the information regarding the performance of products of the brand.
- Identification of product phase, product penetration, technological know-how, etc, are deep-dived into to understand the product trends and output.
- The factors such as sales and demand from the past trends are considered to estimate the future market growth and analyse the upcoming strategies for follow-up analysis.