Using A.I., This Chinese Retailer Can Track Shoppers on the Internet and in Its Aisles

November 11, 2019, 9:27 PM UTC

Everyone is doing A.I., but not everyone is doing it well.

That’s the conclusion of a panel on how corporations are implementing artificial intelligence projects, which took place last week at the Fortune Global Tech Forum in Guangzhou, China.

“Only 30% [of companies] are extracting current value,” BCG Henderson Institute chairman Martin Reeves told the audience at last week’s technology summit.

According to Reeves, there are several telltale signs of successful A.I. projects. For starters, companies with effective initiatives don’t run them out of the I.T. department. These companies also tend to be focused on growing revenue, not decreasing costs. Another sign of a well-run A.I. project is that it isn’t talked about as an “A.I. strategy” but rather an “A.I.-driven business strategy.”

One example of an effective strategy, said Reeves, is Suning Technology, a large Chinese retailer that was also represented on the panel. Suning has adopted artificial intelligence technologies in several ways. A.I. helps the company predict what products customers will want to purchase and get those items to the right warehouses and stores in advance of demand. Suning is even able to do this with fresh food, said Jack Jing, the company’s executive vice president.

Suning uses A.I.-powered technology across all of its stores. The company can now monitor how many stores a customer visits, and even how long someone stands in front of a TV that’s for sale. “In all stores, we can trace consumer behaviors offline,” said Jing.

Suning is also opening “autonomous” stores throughout China—locations where customers can pay by looking into a camera, utilizing facial recognition software to determine their identity. According to Jing, Suning plans to open 1,000 of these stores over the next three years.

In some parts of the world, using facial recognition technology for frictionless payment may make some people uncomfortable. But privacy concerns don’t seem to be slowing Suning down—at least not any time soon. The company has found an A.I. initiative that’s helping them grow, and they plan to scale it as much as possible. In China, doing A.I. “well” also means doing A.I. “big.”

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