Generative AI and Smarter Assortments: Top Takeaways From RELEX Live 2024

Logic TeamBlog

Consumer behavior continues to be rocky amid the swings of inflation, shrinkflation, and disinflation; technology is transforming how retailers manage assortment planning; and the buzzword of the year—generative AI—will forever change how retailers engage with consumers. These trends and more dominated conversations at RELEX Live in Atlanta, April 17-19.

Logic attended the event to share with attendees how we help retailers get the most out of RELEX as they work to transform their merchandising—including strategy, planning, implementation, change management, and ongoing managed services. We discussed real-world client case studies from our more than a dozen active RELEX implementations and shared our domain knowledge and RELEX expertise.

We participated in discussions and studied the trends coming out of multiple sessions. Here are a few key highlights from the event:

Data-driven automation is overhauling the supply chain and merchandising strategies

Data-driven automation is overhauling the supply chain and merchandising strategies

AI is evolving within retail practices and at a rapid pace, leading many attendees to discuss how they’re using the technology internally and where it’s still growing.

For example, retailer organizations view AI’s potential in three phases of use: help to read through current data and diagnose problem areas; predict future shopping patterns or strategies; and create internal thought leadership or consumer-facing content with AI.

Automation is the key to how retailers leverage AI, saving merchandising teams, marketers, and analysts time in how they pivot retail strategies or go to market. Examples noted during the event included:

  • AI can transform supply chains around sustainability, automate, and track products to reduce product spoilage and manage CO2 emissions more efficiently.
  • Machine learning can improve a retailer’s financial planning decisions for every category.
  • Automation and AI can build more accurate customer decision trees that enhance space planning.

Without AI, all of these tasks require a tremendous amount of team resources and collaboration with suppliers. AI is transforming how retailers work, especially in how it can diagnose current issues and preempt future ones for companies to prepare for.

Generative AI supports consumers through semantic search

While it’s a subsegment of AI as a whole, generative AI garners the most attention as of late. But questions remain around how consumers themselves can leverage the tool and whether retailers are ready for that. One area of interest is the shift toward “semantic searching” and how consumers are changing how they search for products to be more conversational. Tools like ChatGPT enable consumers to seek information by directly asking chat engines questions like, “What can I cook for dinner for under $20?” or “Can you show me four red coats to wear this winter?”

Brands aren’t paying money to have their products appear in those searches on generative AI tools, unlike, say, a Google search. Because of this, there’s a gap between how retailers get products and content in front of consumers using generative AI tools for more conversational searching. Additionally, how can retailers implement generative AI tools beyond their websites and into mobile apps, digital store signage, kiosks, etc., to directly assist consumers who want to search for products and information through semantic searching?

Assortment management, SKU rationalization

Assortment management, SKU rationalization are table stakes

Throughout the conference, the importance of AI and its ability to transform how retailers build personalized and profitable store assortments was a leading conversation. A few thought-provoking takeaways:

  • Retailers don’t need perfect data to work on assortments. TLOG data and basket data are enough to help companies understand demand transference, identify product substitutes, and remove underperforming SKUs.
  • Using AI to rationalize SKUs, pruning the products that are underperforming, and identifying the items that grow sales, used to be a nice-to-have but now optimization is paramount.
  • AI platforms like RELEX can deliver precise demand forecasting, automate financial planning decisions, and recommend space planning strategies.

CPGs and retailers throughout the event expressed how important it is to implement assortment strategies to match how consumers shop at each store throughout a retailer’s network. With the cost of goods continuing to rise, private label products increasing their market share, and consumers purchasing smaller baskets and buying fewer large-ticket items, retailers need to be prepared.

Unhappy shoppers will brand-switch or change stores in an instant in the current economic landscape. AI-powered forecasting and assortment planning can put retailers in top form to succeed in the face of these challenges.

Logic elevates RELEX’s cloud-native platform

To learn more about how Logic can help you get the most from RELEX’s solutions and take advantage of next-gen AI tools for assortment, space planning, and more, contact us to schedule a meeting.

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