Interview with Premal Patel, Vice President and Managing Director of Catalina UK
Shereen Shabnam
Premal Patel, a visionary leader with over 30 years of expertise in retail, loyalty, and shopper personalization, is at the forefront of driving innovation in the retail landscape. As Vice President and Managing Director of Catalina UK, he leverages his deep understanding of consumer behavior and data analytics to connect retailers with their customers in meaningful ways. In this exclusive interview, Patel shares his insights on the transformative role of AI in retail, its impact on consumer trust, and the future of personalized shopping experiences.
How is AI currently being utilized in retail to enhance the shopping experience for consumers, and what innovations do you foresee in the near future?
AI is changing at breakneck speed and promises to change the way we all gather information and shop. However, consumers are a little hesitant as they feel uncertain about how their data is being used by retailers to drive the shopping experience. Even today it might feel like everyone is excited about AI and what it can do to improve their shopping experience, however it is my belief that only 30% of consumers actually feel that AI will improve their shopping experience.
Retailers have a challenge to blend AI power with human connection. Retailers will view AI as a means to reduce costs of running their business, ie people/staff especially customer service roles. AI will drive efficiency but cannot replace the importance of human connection in the shopping experience.
Retailers are using AI to:
- Provide consumers the ability to consent and control how their data is being used.
- Deliver the best offers for you as a consumer by understanding your shopping patterns and behaviour.
- Improve service delivery.
There is still a lot of uncertainty on how data is being used and frustration with the fact that often consumers do not get a chance to talk to a human being when they have a question or query, however, over time consumer confidence and trust will grow as they better understand the benefits AI can deliver at a personal level. Until this time, brands and retailers must continue to work on building consumer trust – one poor AI experience will undermine all the investment and hard work retailers put in.
Some of the winning innovations that AI delivers are:
- Faster customer support
- Helping staff deliver a better service
- More creative communication and advertising, and
- Improved understanding of consumer behaviour and delivery of personalised experiences
How can retailers effectively integrate AI technologies into their operations while ensuring a seamless experience for customers both online and in-store?
The important thing is to combine old tools with new ones. Digital Marketing offers exciting opportunities (AI offers various possibilities), but this does not mean throw out the old and bring in the new, many tried and tested solutions to deliver personalised experiences still work very well, but they can be powered by better AI systems.
There are many more on- and off-platform channels to engage consumers during their path to purchase and in the western world c.60% of consumers link OOH Ads with increased trust and therefore encourages them to engage brands online after seeing a DOOH ad.
Brands and Retailers can now create frictionless and seamless shopping experiences navigating consumers across on and off-platform channels, AI can add real value across channels and driving the purchase decision. For example, ingesting weather data into the system to drive localised offers and promotions in digital OOH channels, this then drives consumers into store. You can also deliver a printed or digital coupon in store which makes the consumers’ experience very personalised so your consumers feel you (as a retailer) understand them as an individual and really understand their shopping preferences.
If you are a retailer or brand the main watch-out is to avoid being seen as intrusive.
What are some challenges retailers face when implementing AI solutions, and how can they overcome these obstacles to maximize the benefits?
AI is still relatively new so many consumers may see AI innovations as a fad or gimmick, and short-lived. What this means is retailers must deliver immediate value and impactful value, i.e. consumers must see a reason to use AI tools during their shopping experience – AI must deliver lasting value i.e. breaking down complex categories to make choices easier especially for consumers who are not familiar with specific categories.
Retailers must start with the consumer problem, i.e. what are you trying to fix and then build the AI tool/system around fixing the problem. For example, algorithms on social media look at historical behaviour and serves more of the same offers/information which could lead to consumer fatigue, i.e. you see the same thing repeatedly. AI should be used to deliver surprise and delight moments to achieve cut through and connect with consumers in a more human way.
How is AI changing inventory management and supply chains in retail, and what advantages does this offer for retailers and shoppers?
In the same way AI delivers real-time data and insights to consumers to drive behaviour, AI can be used to manage the business to drive efficiency across the supply value chain. AI can assist with stock control delivering the right message to the right staff member when stocks are close to being depleted and/or when there is too much of a product and the business needs to sell fast. AI can power promotional pricing and deliver automated messages to ensure businesses manage their stock effectively ensuring stock is delivered and sold quickly
The growth of Artificial Intelligence will take the fire hose of opportunities to target audiences across channels. It streamlines the decision process of when and how much to bid on a specific opportunity and addresses both known and unknown shoppers.
For example, if you’re looking to reach salty snack lovers, AI based bidding allows you to bid higher on sports media and lower on organic food websites by time of day or geography. It will combine media consumption data with loyalty card shoppers with contextual targeting of similar consumers across channels.
Research shows that those who execute strong omni-channel engagement see a 9.5% increase in annual revenue. Eventually, the industry is expected to build unified solutions where every aspect of the marketplace is connected from your mobile app to your store design.
AI tools can help retailers understand how much stock is on shelf, in the warehouse and in delivery so real-time management of stock enables faster cash-flow. Shoppers often benefit because they are targeted with special reduced price products in line with their usual shopping behaviour.
In what ways can retail media help brands create more meaningful connections with customers, and how does this influence customer retention and brand loyalty?
Retail media networks (RMNs), described as the “third big wave” of advertising after search and social, has emerged as a significant trend, offering new opportunities to reach consumers and for retailers to monetize their digital assets.
Retail media has become a buzzword over the last couple of years. Rapid developments in this space often mean there are misconceptions about what it actually is and the opportunities it offers to brands and retailers today.
Digital off-site propositions now enable brands to utilise rich, first party data to ensure they are targeting the most relevant shoppers as part of their social, digital and CTV campaigns. These new capabilities mean retail media provides an amazing solution to drive personalised targeted awareness and consideration for brands.
It is easy to think retail media is just digital. However, you go to any major grocer, and you will see an array of instore activations from signposting new products in aisles, in-store sampling, store-wraps. The majority of shoppers do their weekly shop in-store, so instore activations remain a critical part of the brand’s shopper marketing plans to drive interaction through to point-of-purchase. Engaging shoppers through their path to purchase is critical today, but the actual purchase decision is usually made instore. The best campaigns take into consideration all customer touch-points using online to inspire and off-line to drive targeted awareness. Retail Media enables more data points which means retailers can get to know their customers better and improve the products, communication and service they deliver to drive long-term loyalty.
