Generative Artificial Intelligence (AI) has become something of a buzzword in just about every industry these days, and convenience is no exception. Although there is no doubt a great deal of hype surrounding the nascent technology, there are also some real-world examples of how it is already changing the industry.
In Wednesday’s General Session, “Leveraging AI to Enhance Your Business,” outgoing NACS Chairman Victor Paterno, president and CEO of Philippine Seven Corp., explained how his company used AI to bounce back after the devastating Covid-19 pandemic in 2020.
Paterno said the response to the pandemic by the Philippine government was among the worst in the world, and that made things even more difficult for retailers like 7-Eleven Philippines to navigate an already treacherous situation. As they tried to absorb the changing buying habits of customers during the pandemic, their initial experiments with AI didn’t always work out so well as they used it to determine the sizes of items customers were buying during the pandemic. The trouble was the stores didn’t always have room for the larger sizes that were suggested by AI.
“We had a very hurried pivot to, ‘oh wait, people are buying groceries so we have to stock up on them and put the big sizes in,’” he said. “You had empty shelves, you had back rooms that were full. Basically, what happened was the store said we are subscribing to the five-section planogram, but they actually only had three sections.”
Fortunately, Paterno said his company was able to learn from that experience and by 2022 and 2023, they were using generative AI in new ways to help bounce back by using a variable planogram.
“It’s really using AI to solve that problem of what to sell in our stores and, with variable planograms, how to make space for it,” he said. “A variable planogram is basically all about customizing the assortment by item, by store. We’re the only convenience store in the world that does it. What it will also allow us to do is enable us to launch products only where they will sell. It doesn’t have to be in all stores. Suppliers love this.”
Brian Gray, managing director of Accenture, demonstrated ways in which generative AI programs like ChatGPT can go even further in assisting your business. He highlighted four different retail use cases, including spotting and capitalizing on local trends, forecasting and ordering, enhancing the employee experience, and personalizing the customer experience.
Gray used an example of a fictitious store that was located along a major bike trail but wasn’t selling any items catering to bikers. He demonstrated how AI could generate ideas to bring those bikers into the store, including a DIY smoothie bar. He showed how the AI could be used for forecasting and ordering items for the smoothie bar. He also discussed how it could be used for hiring and maintaining relationships with employees, as well as personalizing the customer experience by gathering data on customers that may not even come into your store.
While this might seem overwhelming to you and your team members, Gray said it’s a conversation worth having.
“Be curious and start experimenting,” he said. “Talk to your teams. Have the conversation. You’d be amazed at the ideas that start to be generated.”
For more on ways that artificial intelligence can make an impact on c-stores, check out “A Friction-Free Future” in the June 2024 issue of NACS Magazine.