Combining AI and Location Intelligence to Predict Market Demand

Growing customer expectations related to personalization and transparency are putting unprecedented pressures on businesses to deliver reliable outcomes, at exactly the right time.  But companies relying on traditional methods to plan and deliver products won’t keep pace with these changing market demands.  Forward-thinking businesses are finding ways to tap into the data they need to be able to predict—with high levels of accuracy—what customers are going to demand, when they want it, by what channel, and most importantly, where they want it available.  By combining location intelligence and artificial intelligence (AI), companies can bridge the traditional gap between supply chain forecasting and actual consumer demand.

Today’s merchandise planning spans the entire complex network in dynamic iterations that reflect real-time trends. Predictive demand sensing, backed by location intelligence and AI, gives companies the edge to compete and build customer trust. Companies apply this innovative approach to deliver higher customer satisfaction, gain competitive advantage and achieve higher brand value.

Right Products, Right Place

To maintain customer loyalty, product and services providers must anticipate customer behavior as well as environmental situations that may impact supply throughout the network. Location intelligence allows merchants to visualize and analyze these specific customer behaviors in the context of where and when they occur. This means data from specific store locations blended with online interactions can show buying patterns based on certain times, events, and conditions within detailed customer segments.

During flu season, for example, a pharmacy or supermarket might have a run on cold medicines and other healthcare supplies. An analysis that considers the history of when and where these outbreaks occur, combined with current environmental conditions, can predict purchasing demand in the upcoming days and weeks. By analyzing the pattern of buying behavior, in-store and online, companies can channel the right merchandise to the right locations.

Manufacturers, distributors, and retailers can anticipate where specific goods are needed before the demands arise, and improve availability of products and services during peak times. Using real-time behavior data along with environmental conditions such as social, weather, and lifestyle factors, businesses can initiate production and precise distribution while reducing inventory shortfalls or excess.

Building Customer Trust

The aspiration to grow customer trust requires a profound understanding of consumer and market behaviors at a hyper-segmented level, the type of insights that only location intelligence can provide. Companies must be prepared to capture and analyze the entire purchasing lifecycle, regardless of channel, and only then are supply chain organizations best positioned to deliver on that promise.

Neil Ackerman, Senior Director, Global Supply Chain Advanced Planning and Innovation at Johnson & Johnson spoke at a conference recently and stressed that as advanced planners, we should all be able to predict, with high accuracy, what customers will want all the time, every time, thus strengthening trust between customer and brand. In fact, he says, “artificial intelligence should really be called actual intelligence,” since we’re gaining intelligence from actual data that helps us to make the best business decisions.

This actual intelligence enables merchants to see patterns in their customers’ purchasing behaviors. For example, if a commercial tire manufacturer with a distribution center in the Kansas City area follows historic stocking levels regardless of more advanced intelligence planning options, it won’t be able to meet the right product demands while also suffering expensive stock overages. With AI and location intelligence however, that wholesaler could anticipate shifts occurring in the market due to increased infrastructure construction in the region, unusually severe weather forecasted, or a new competitor in the trade area combined with detailed historic sales information. This automated insight ensures that the right inventory needs are predicted and scheduled to be delivered where and when needed, maximizing customer service levels.

Growing Brand Loyalty

Every successful company makes a priority goal to keep their brand strong with customers. Brand strength cannot exist without trust. The stronger the brand attachment, the higher likelihood of repeat sales for more share of wallet. In turn, this leads to better ratings to attract new customers, deeper insights into buying behaviors, and a competitive advantage to anticipate and deliver more personalized products and services to an enthusiastic market.

Given the sheer volume of consumer behavior data companies can access, they must use location intelligence and AI for a personalized approach. This means analyzing data by the type of customer, desired products and services, and preferred channels of engagement.  As all types businesses work toward connecting across the customer lifecycle, especially those most valued customers, merchants can employ innovative tactics to provide seamless digital and personal interactions that build trust and solidify loyalty.

Now that anytime, anywhere availability of goods and services is becoming the norm, supply chain professionals will need to transform their businesses to predict what mix of products are needed, by what channel and where, even before the customer has their first cough. This new era of “actual intelligence” allows businesses to keep the promise of fast, convenient access to desired products. Customers can continue trusting their favorite brands and receive higher levels of service. Companies using location intelligence and AI won’t have to wait for orders to come in to fulfill the demands at the store level. They can have a complete picture of the supply and demand chain ecosystem: Who wants what, when they want it, and where it needs to go.