The CB Insights 2019 Retail Trends Report Validates PopCom in a MAJOR way
When I got the idea to start PopCom (Solutions Vending International, Inc.) in 2012 as a smart hardware company with the focus on retail products MANY people, especially investors, ignored my efforts stating there was not a market or the opportunity was too small.
I knew from my work as Founder & CEO of shoe company Flat Out of Heels, that there was an emerging market of retailers who wanted a better direct to customer distribution solution. I was aware that hardware was not a ‘sexy’ investment, it’s capital intensive and often requires many iterations before the product reaches the market. I also knew that in 2012, the hardware and software on the market was not capable of meeting the needs of the retailers, so adoption would be slow until technology was up to speed.
I was fortunate to find one angel investor who believed in me enough to write the first check for $90,000, that was more than enough to get started, develop the business plan, the IP and MVP and wait until the market was ready. My rationale was that when people were ready to adopt the tech, we would have a product to sell.
I spent the next six years building hardware, running pilots, beta testing, failing, building again — validating, and growing the customer base. In 2017, I built a team, we pivoted the focus to building software and hardware, we fundraised, ran out of money, raised money again…all while waiting for the general market to be ready for what we were building. My mantra has always been ‘stay ready so you don’t have to get ready’ — and finally, according to the CB Insights 2019 Emerging Retail Trends Report — the world is ready for us. The market is aligning with the vision and the products, and I am so excited to share this data with you.
The CB Insights report released in March 2019 identifies the NExTT Trends in retail and categorizes these trends by what they term as transitory, necessary, experimental, and threatening. PopCom is leading innovation in both the ‘necessary’ and ‘threatening’ categories.
The report defines ‘necessary’ as “trends which are seeing widespread industry and customer implementation / adoption and where market and applications are understood. For these trends, incumbents should have a clear, articulated strategy and initiatives.”
As you see on the chart above, PopCom offers 4 of the 6 trends listed:
· Pop-up shops
· Personalized marketing
· Inventory management
· Small-format stores
The report defines ‘threatening’ as “large addressable market forecasts and notable investment activity. The trend has been embraced by early adopters and may be on the precipice of gaining
widespread industry or customer adoption.”
As you see on the chart above, PopCom offers 4 of the 6 trends listed:
· In-store data collection
· Automated checkout
· Stores as fulfillment centers (which closes the last mile delivery gap with vending)
We are currently working to integrate the following functions featured in the ‘transitory’ (trends seeing adoption but where there is uncertainty about market opportunity) and ‘experimental’ (conceptual or early-stage trends with few functional products and which have not seen widespread adoption) categories including:
· Autonomous (Automated) last mile delivery
· Blockchain for retail supply chain management
These are not of the highest priority for us but definitely on our radar.
WHY AND HOW POPCOM IS PIONEERING
According to the United Nations, just over two-thirds of the entire global population will be living in cities or urban areas by 2050. Major retailers including IKEA, Target, Kohl’s, Nordstrom, and Sephora are beginning to shy away from traditional large stores and opening downsized ‘small-format’ stores that cater to increasingly urbanized consumers in ‘city center’ areas. Smaller footprints mean lower real estate related costs, tightened inventory management and reduced staffing requirements.
PopCom is taking the ‘small store’ to the next level with our PopShop Kiosks that require very small space and no staff. The PopShop manages inventory and sales data in real time, similar to an e-commerce store. All of the information can be accessed from the dashboard remotely and in real time.
“Going forward, the wide proliferation of pop-up stores will shape the ways in which commercial real estate owners lease real estate all together.” — CB Insights 2019 Retail Report
Pop-up shops represent a $10B industry in the U.S. and growing. These temporary/short-term brick and mortar installations allow retailer to sell and sample products direct to customer, and serve as a branding tool without the risk of long-term retail contracts. We call the PopShop Kiosk a ‘digital pop-up shop’ — our machines can be placed in retail locations like malls, airports, transit stations, convention centers, anywhere with a power outlet, for as short as one day or as long as the retailer chooses. If the retailer discovers that the product is not selling to their satisfaction in that location, they can simply unplug the PopShop and move it to another location. Our software calculates the conversion rates so brands know exactly how many people walk by versus how many purchase, so they can actually gauge the traffic performance of the machine each day. Ideally, in time they will be able to find the perfect location for optimal sales conversions.
The PopShop also has the capability to leverage the consumer data collected at the point of sale to allow retailers to personalize their marketing. The PopShop advertising screen delivers targeted and customized messaging and advertisements based on the demographic profile of the customer standing in front of the machine.
The report cites ways companies like Alibaba are leveraging facial recognition. I was inspired by Alibaba’s ‘Face Pay’ technology when developing the PopCom technology — we care deeply about consumer privacy so our team has taken careful measures to protect customer data.
PopCom aims to set a precedent for the types of data (down to consumers’ facial expressions) that retailers can capture for a deeper understanding of the customer, while maintaining customers right to privacy.
PopShops use facial recognition technology to identify the customer demographic profile and customer journey. With growing concerns around privacy in the U.S., PopCom technology does not take any identifying information or store customer images, we simply create a demographic profile to represent each passerby (i.e. approximate age, identifiable gender, etc.)
We also understand the issue around bias in facial recognition and I believe the way to eliminate these bias is to continue to provide the algorithms with more data to be able to properly identify more diverse personas. Machine learning has to be fed data in order to become smarter…the more people of color the system interacts with the better it will get at identifying people of color.
The report states — “…retailers bring personalization to an entirely new level — tailoring each consumer interaction based on data (for instance, an individual’s mood interpreted from a facial expression) to drive consumer interest and loyalty.” — this is precisely what PopShop Kiosks can do.
Automated checkout technology is growing fast in China and the US. While large internet companies like Amazon and Alibaba are dominating the space, PopCom is working to help democratize access for all retailers, especially small businesses. I believe companies of all sizes should have the opportunity to sell direct to customer in a physical retail space.
Our PopShops support localization and allow retailers to provide product offerings to meet the needs of local communities. PopShops also can cut the costs of last-mile delivery — customers can order online and pick up from a vending machine in their area — very similar to what Amazon offers with their package lockers.
You can read the full report HERE — it is FULL of amazing data and examples of how automation and technology are shaping the future of retail. PopCom has continued to be ahead of this trend. Unfortunately manufacturing challenges and being under-capitalized have plagued us in the past, however those days are now behind us. I am excited about what the next 12 months hold for PopCom. I have learned not to make announcements about when the product will launch, so I am holding off until it actually does launch, but believe me it is coming very soon. We have a strong pipeline of customers and many under contract ready to sell products in a PopShop.
To learn more about PopCom and our technology visit www.PopCom.Shop
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