The retail industry is changing. Technology has pushed all industries to evolve, and retail is no different. Big players like Amazon are expanding to new markets putting pressure on both offline and online retail. At the same time, it has never been for potential customers to compare the same product between retailers. All this melts together in a world where retailers today spend more and more money on attracting new customers.
The most common way retailers attract new customers is through campaigns and promotions on products. Retailers spend about 10 times more money on promotions than on marketing.The problem is that most retailers have no idea if their promotions gives true revenue lift, because evaluating the lift can be really difficult. Professionals in the area are often relying on their experience, home-made Excel sheets and gut-feeling to evaluate the performance. Cross-selling, seasonal effects and cannibalization between products are just some of the things that makes it hard to measure the impact of promotions. Fact is that:
- 20–50% of all promotions do not give any incremental sales lift (!)
- 40% of all promotions do not grow the category when you take into account cannibalization and stockpiling
Formulate offers an intelligent solution for retailers to understand their retail data data better. Using technology based on artificial intelligence, the service detects complex patterns in retailers transaction data and let them see which products, discounts, brands and suppliers that grow their business. The service, delivered in a SaaS model, analyses standard receipt data from e-commerce and physical retailers and takes into consideration how purchases for non-discounted goods and categories are influenced by promotions, how season and weather are driving sales, what deals are the most effective in different parts of the assortment, etc.
Formulate has taken a product-first approach based on science and machine learning to let retailers understand one of their most important customer acqusition tools. Customers are asking for smooth installation and set-up while at the same time being able to handle large amounts of data for the retailers. Advanced marketing intelligence will be asked for in a much larger extent as competition increases. Formulate is trusted by large customers such as Coop and Apoteket who uses their service to improve return on investment on their promotions and campaigns.
We are truly impressed by the teams drive and vision and their determination to build a unique SaaS solution that lets retailers understand in detail how their promotions are performing. Niche tools that solves huge problems in changing markets are highly interesting for us. We are determined to help Formulate become the winner on a global scale in this exciting market.
We are very happy to be backers of this exciting journey. Thanks for your confidence Andreas, Arvid, Robin and the rest of the Formulate team.
And by the way, they are hiring!