‘Amazon Charts’ Re-Define ‘Best Seller’

The New York Times: Amazon now tracks “not only the top-selling digital and print books on Amazon, but the ones that customers spend the most time reading … With its lists, Amazon aims to redefine the notion of a best seller, expanding it to include books that are ‘borrowed’ from its e-book subscription service, and ones that are streamed on Audible. As a result, the lists give increased visibility to books that might not typically appear on other best-seller lists.”

“All of Amazon’s acquisitions and new features are having a cumulative effect, allowing the company to draw on its vast customer base and troves of data to discover what is popular, and return that information to customers, creating a lucrative feedback loop … Crowdsourcing and data mining are also driving the company’s approach to its bookstores, which act as showcases for books popular with customers on the site. While the stores have traditional categories, like fiction, nonfiction and travel, the most eye-catching shelves feature categories culled from Amazon’s customer data.”

“The first thing customers see when they walk into the store is a large display table, labeled Highly Rated, which includes books with an average rating of 4.8 stars or higher on a scale of 5 … Another display case, labeled Page-Turners, features books that people finish reading on their Kindle in fewer than three days … Another section features the most ‘wished for’ books from Amazon’s website … The books are all displayed face out. Under each book is a card with the average customer rating, the number of reviews and a featured review from an Amazon reader. Displaying the full cover of each book mimics the visual look of Amazon’s website, and might lure customers to unfamiliar titles.”

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Google Eyes: Watch While You Shop

The Washington Post: “Google executives say they are using complex, patent-pending mathematical formulas to protect the privacy of consumers when they match a Google user with a shopper who makes a purchase in a brick-and-mortar store. The mathematical formulas convert people’s names and other personal information into anonymous strings of numbers.”

“The formulas make it impossible for Google to know the identity of the real-world shoppers, and for the retailers to know the identities of Google’s users, Google executives said. The companies know only that a match has been made. In addition, Google does not get a detailed description of the individual transactions, just the amount spent.”

“Google would not say how merchants had obtained consent from consumers to pass along their credit card information. In the past, both Google and Facebook have obtained purchase data for a more limited set of consumers who participate in loyalty programs. Consumers that participate in loyalty programs are more heavily tracked by retailers, and often give consent to share their data with third parties as a condition of signing up. (Not all consumers may realize they have given such consent, according to the digital privacy advocacy group Electronic Frontier Foundation).”

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Not SeeFood: App Apes ‘Shazam for Food’

The Verge: “In a peculiar case of life imitating art imitating life, Pinterest has announced a new recipe-finding feature that makes use of computer vision to tell you about a dish when you point your smartphone camera at it … It sounds an awful lot like SeeFood, the fake ‘Shazam for food’ app from the HBO comedy Silicon Valley. Pinterest, of course, doesn’t use that terminology anywhere, nor does its marketing material even reference the sitcom or its ludicrous parody, which manifested itself as an app that could only tell you whether an object was or was not a hotdog.”

“When reached for comment regarding SeeFood, a Pinterest representative confirmed to The Verge that the Silicon Valley episode was ‘separate and completely coincidental’.”

“This is all part of a broader artificial intelligence push in the tech industry to apply machine learning techniques to everyday life. By training neural networks on huge mounds of data and translating that into a real-time algorithm, tech giants like Google, Facebook, and Microsoft are now developing software products that can digest and understand the world, from text to photos to even videos.”

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The Stitch Fix Secret: Make Shopping Easy

The New York Times: Stitch Fix is a mail-order clothing service that offers customers little choice in what garments they receive, and shies away from discounts for brand name dresses, pants and accessories. Despite a business model that seems to defy conventional wisdom, Stitch Fix continues to grow … To the company’s founder, Katrina Lake, success comes down to delivering what consumers want: making it easier to shop … In her view, what was important was helping customers find clothing they liked without taking lengthy shopping trips and returning dozens of items.”

“At the company’s warehouse, Eric Colson, formerly a top data scientist at Netflix, spoke to the role that data science — once the province of high-tech giants — plays in nearly every aspect of the Stitch Fix business. Mr. Colson excitedly illustrated on whiteboards how the company’s systems can narrow down a broad range of women’s pants to a relative few that each individual customer is statistically likely to keep … Algorithms have even cut the number of steps needed for workers to pick out clothes for individual clients.”

“Yet the question remains whether customers who are initially thrilled by receiving a customized box of clothing will remain customers for months or even years … Stitch Fix executives declined to share their retention statistics, but claim that they are above industry averages.”

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IKEA Asks: Do You Speak Human?

The Verge: ‘If you put an AI in charge of your house — letting it control the lights, the alarms, the temperature, and so on — how would you want it to act? Should it be ‘autonomous and challenging’ or ‘obedient and assisting’? Would you prefer if it sounded male, female, or if it was gender neutral? Should it be religious? These are just some of the questions Ikea is asking its customers in a new survey titled: Do you speak human?”

“With this new survey, Ikea is focused on computer personality, looking to find out what sort of AI people would be happiest to interact with. This is a question that preoccupies the big tech companies, too — that’s why they’re hiring novelists and comedians to finesse the personality of their digital assistants.”

“Ikea is updating the results of the survey as it goes; so far it’s saying that 41 percent of people want their AI to be ‘obedient and assisting,’ 42 percent want it to be ‘gender neutral’ (as opposed to 35 percent for male, 24 percent for female), and 87 percent say they want their AI to ‘detect and react to emotions.’ There’s bound to be some self-selecting bias at work here, as the people who answer this survey are more likely to be interested in technology in general, but it’s still a very intriguing project.”

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Who Will Win The Retail Race?

The Wall Street Journal: “Can physical retailers build intimate digital relationships with their customers—and use that data to update their stores—faster than online-first retailers can learn how to lease property, handle inventory and manage retail workers?”

“It isn’t hard to picture today’s e-commerce companies becoming brick-and-mortar retailers. It’s harder to bet on traditional retailers becoming as tech savvy as their e-competition.”

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Vegas Shuffle: Invasion of the Drink Bots

The Wall Street Journal: “As Las Vegas has transformed into one of the world’s most-visited tourist destinations, casino operators are re-examining the perks that historically lured gamblers. Over the past year, casinos have started charging for parking at resorts on the Strip … Now operators have started scrutinizing complimentary drinks, introducing new technology at bars that track how much someone has gambled—and rewards them accordingly with alcohol.”

“It’s a shift from decades of more-informal interplay between bartenders and gamblers … On a recent night at a bar inside the Paris Las Vegas casino, Jamie Balazs and her father were getting used to the new drink-monitoring system. They had just been instructed on how much they needed to put into the machine to allow booze to flow. A bartender told her to push the “max bet” button four times, she said. She said she understood the desire to weed out freeloaders who aren’t gambling but found the instructions off-putting.”

“Her father, Jim Fletcher, was in town with a group to celebrate his 70th birthday. As a top-tier member in Caesars Entertainment Corp.’s rewards program, he felt the new system was ‘insulting’ … Bartender James Tanner said the system has made his job easier because he can avoid awkward debates with customers who were lingering at machines but not really playing.”

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Facebook Chatbots Test ‘Conversational Commerce’

The Washington Post: Mastercard “has partnered with Subway and two other major merchants to launch ‘chatbots,’ which are robots that simulate human conversation. The Subway iteration allows you to order a custom sandwich for pickup, something of a digital version of walking down the chain’s sandwich assembly line.” Cheesecake Factory “allows shoppers to purchase and send out gift cards.” FreshDirect lets shoppers “place orders for groceries and meal kits. The bots will be found within Facebook’s popular Messenger app, and will be powered by Masterpass, the credit card giant’s digital wallet.”

“The debut of the bots will provide a fresh test of shoppers’ appetite for what the industry has dubbed ‘conversational commerce,’ the idea of making a purchase or other customer service transaction through A.I.-powered messaging … Consumers are spending more time online, and yet they are concentrating those minutes in a very limited number of apps. Retailers … are realizing that the best way to snare your interest online might not be with a killer app of their own, but by creating bots that live in the apps that you already use.”

“Facebook has said that more than 33,000 bots have been created for its Messenger app so far. This latest batch demonstrates how differently businesses are approaching the technology at this early stage of the game.”

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Farfetch: An Operating System for Retailers

Quartz: Farfetch, the wildly successful e-commerce platform that allows luxury-fashion boutiques around the world to sell online without maintaining their own costly digital operations, is … unveiling a demo of what it has modestly dubbed the Store of the Future.”

“The ‘store’ … isn’t actually a store. Rather, it’s a retail platform with a suite of different technology products the company intends for partner shops to mix and match to create their own unique experience.” These include:
“Clothing racks enabled with RFID that detect what the customer is browsing and can populate a wish list. Digital mirrors that let the customer view their wish list and request the items in the desired sizes or colors. A mobile payment system for easy checkouts.”

“Farfetch, which doesn’t have its own stores, sees its platform as an ‘operating system’ for retailers, and hopes third parties will build their own applications on it the way developers build their own apps for iOS or Android. What Farfetch will maintain control over is the customer data that allows the physical store and any digital product to remain synched up.”

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