The Amazon boogie-man has every retailer scrambling for ways to fight back. But the cost and effort to install cameras all over the ceiling or into every shelf could block stores from entering the autonomous shopping era. Caper Labs wants to make eliminating checkout lines as easy as replacing their shopping carts while offering a more familiar experience for customers.
The startup makes a shopping cart with a built-in barcode scanner and credit card swiper, but it’s finalizing the technology to automatically scan items you drop in thanks to three image recognition cameras and a weight sensor. The company claims people already buy 18 percent more per visit after stores are equipped with its carts.
Today, Caper is revealing that it’s raised a total of $ 3 million including a $ 2.15 million seed round led by prestigious First Round Capital and joined by food-focused angels like Instacart co-founder Max Mullen, Plated co-founder Nick Taranto, Jet’s Jetblack shopping concierge co-founder Jenny Fleiss, plus Y Combinator. Caper is now in two retailers in the NYC area, though it plans to use the cash to expand to more and develop a smart shopping basket for smaller stores.
“If you walked in to a grocery store 100 years ago versus today, nothing has really changed” says Caper co-founder and CEO Lindon Gao. “It doesn’t make sense that you can order a cab with your phone or go book a hotel with your phone, but you can’t use your phone to make a payment and leave the store. You still have to stand in line.”
Autonomous retail is going to be a race. $ 50 million-funded Standard Cognition, ex-Pandora CTO Will Glaser’s Grabango, and scrappier startups like Zippin and Inokyo are all building ceiling and shelf-based camera systems to help merchants keep up with Amazon Go’s expanding empire of cashierless stores. But Caper’s plug-and-play cart-based system might be able to leapfrog its competitors if it’s easier for shops to set up.
Inventing The Smart Cart
“I don’t have an altruistic reason to care about retail, but I really want to put a dent in the universe and I think retail is severely under-innovated” Gao candidly remarked. Most founders try to spin a “super hero origin story” about why they’re the right person for the job. For Gao, chasing autonomous retail is just good business. He built his first startup in gaming commerce at age 14. The jewelry company he launched at 19 still operates. He went on to become an investment banker at Goldman Sachs and JP Morgan but “I always felt like I was more of a startup guy.”
Caper was actually a pivot from his previous entry to the space called QueueHop that made cashierless apparel security tags that unlocked when you paid. But during Y Combinator, he discovered how tough it’d be to scale a product that requires a complete rethinking of a merchant’s operations flow. So Gao hoofed it around NYC to talk to 150 merchants and discover what they really wanted. The cart was the answer.
V1 of Caper’s cart lets people scan their items’ barcodes and pay on the cart with a credit card swipe or Apple/Android Pay tap and their receipt is emailed to them. But each time they scan, the cart is actually taking 120 photos and precisely weighing the items to train Caper’s machine vision algorithms in what Gao likens to how Tesla is inching towards self-driving.
Soon, Caper wants to go entirely scanless, and sections of its two pilot stores already use the technology. The cameras on the cart employ image recognition matched with a weight sensor to identify what you toss in your cart. You shop just like normal but then pay and leave with no line. Caper pulls in a store’s existing security feed to help detect shoplifting, which could be a bigger risk than with ceiling and shelf camera systems, but Gao says it hasn’t been a problem yet. He woudn’t reveal the price of the carts but said “they’re not that much more expensive than a standard shopping cart. To outfit a store it should be comparable to the price of implementing traditional self-checkout.” Shops buy the carts outright and pay a technology subscriptions but get free hardware upgrades. They’ll have to hope Caper stays alive.
“Do you want guacamole with those chips?”
Caper hopes to deliver three big benefits to merchants. First, they’ll be able to repurpose cashier labor to assist customers so they buy more and to keep shelves stocked, though eventually this technology is likely to eliminate a lot of jobs. Second, the ease and affordable cost of transitioning means businesses will be able to recoup their investment and grow revenues as shoppers buy more. And third, Caper wants to share data that its carts collect on routes through the store, shelves customers hover in front of, and more with its retail partners so they can optimize their layouts.
One big advantage over its ceiling and shelf camera competitors is that Caper’s cart can promote deals on nearby or related items. In the future, it plans to add recommendations based on what’s on your cart to help you fill out recipes. ‘Threw some chips in the cart? Here’s where to find the guacamole that’s on sale.’ A smaller hand-held smart basket could broaden Caper’s appeal beyond grocers amongst littler shops, though making it light enough to carry will be a challenge.
Gao says that with merchants already seeing sales growth from the carts, what keeps him up at night is handling Caper’s supply chain since the product requires a ton of different component manufacturers. The startup has to move fast if it wants to be what introduces Main Street to autonomous retail. But no matter what gadgets it builds in, Caper must keep sight of the real-world stress their tech will undergo. Gao concludes “We’re basically building a robot here. The carts need to be durable. They need to resist heat, vibration, rain, people slamming them around. We’re building our shopping cart like a tank.”
Want to run your own home shopping network? Facebook is now testing a Live video feature for merchants that lets them demo and describe their items for viewers. Customers can screenshot something they want to buy and use Messenger to send it to the seller, who can then request payment right through the chat app.
Facebook confirms the new shopping feature is currently in testing with a limited set of Pages in Thailand, which has been a testbed for shopping features. The option was first spotted by social media and reputation manager Jeff Higgins, and re-shared by Matt Navarra and Social Media Today. But now Facebook is confirming the test’s existence and providing additional details.
The company tells me it had heard feedback from the community in Thailand that Live video helped sellers demonstrate how items could be used or worn, and provided richer understanding than just using photos. Users also told Facebook that Live’s interactivity let customers instantly ask questions and get answers about product specifications and details. Facebook has looked to Thailand to test new commerce experiences like home rentals in Marketplace, as the country’s citizens were quick to prove how Facebook Groups could be used for peer-to-peer shopping. “Thailand is one of our most active Marketplace communities” says Mayank Yadav, Facebook product manager for Marketplace.
Now it’s running the Live shopping test, which allows Pages to notify fans that they’re broadcasting to “showcase products and connect with your customers.” Merchants can take reservations and request payments through Messenger. Facebook tells me it doesn’t currently have plans to add new partners or expand the feature. But some sellers without access are being invited to join a waitlist for the feature. It also says it’s working closely with its test partners to gather feedback and iterate on the live video shopping experience, which would seem to indicate it’s interested in opening the feature more widely if it performs well.
Facebook doesn’t take a cut of payments through Messenger, but the feature could still help earn the company money at a time when it’s seeking revenue streams beyond News Feed ads as it runs out of space there, Stories take over as the top media form and user growth plateaus. Hooking people on video viewing helps Facebook show lucrative video ads. The more that Facebook can train users to buy and sell things on its app, the better the conversion rates will be for businesses, and the more they’ll be willing to spend on ads. Facebook could also convince sellers who broadcast Live to buy its new Marketplace ad units to promote their wares. And Facebook is happy to snatch any use case from the rest of the internet, whether it’s long-form video viewing or job applications or shopping to boost time on site and subsequent ad views.
Increasingly, Facebook is setting its sights on Craigslist, Etsy and eBay. Those commerce platforms have failed to keep up with new technologies like video and lack the trust generated by Facebook’s real-name policy and social graph. A few years ago, selling something online meant typing up a generic description and maybe uploading a photo. Soon it could mean starring in your own infomercial.
[PostScript: And a Facebook home shopping network could work perfectly on its new countertop smart display Portal.]
In June 2017, the EU Commission sentenced Google to pay a fine of 2.4 billion euros. Now, up to 5% of Google’s daily revenue is at stake if they fail to make their Google Shopping channel more competitive. Google is taking aggressive measures to adhere to the EU’s ruling…
Read more at PPCHero.com
Google Shopping has been growing in prominence in the search results, which is no surprise given the attractiveness of the image-based ads and the mobile-friendly experience.
Advertisers have enjoyed the extremely high conversion rates driven by the natural filtration shopping ads deliver. Much like an offline shopping experience, a customer can decide if they like an item (and the price) before the click ever happens.
As the Shopping results have matured, the higher conversion rates have naturally led to higher costs as the market balances out but only recently, Google announced a discount on clicks bought through a different comparison provider within Google Shopping results.
Clearly, Shopping presents a huge opportunity for many digital retailers. But when you take a step back, there’s another reason that brands should be focusing on this channel.
In addition to having high conversion rates because they filter out clicks from disinterested users, the Shopping results are a really good way to attract browsing behavior from a better qualified audience from higher up the funnel.
The results act as a shop window to your site, attracting in the right type of customer. Normally, non-converting traffic is considered to be of low value, but suddenly with Shopping this traffic is more targeted and so users are more likely to re-engage at a later time, or through a different channel.
When creating attribution models for clients we have noticed that Shopping often works best when viewed on a first click model. This strongly supports the idea that Shopping offers an inspiration-based path to conversion, attracting users to your site for the first time, when ordinarily they may have opted for a different competitor in the market.
Traditional search ads tend to compete on discounts and delivery messages, which are no match for the product desirability you can convey in well-optimized Shopping ads and campaigns.
So how can advertisers capitalize on this opportunity?
The path to Shopping success can be broken down into three steps – build, enhance and optimize.
At the heart of any good Shopping campaign is building an accurate and detailed Shopping feed. Without this, it will be near impossible to compete effectively. This task can be tricky without the right technical expertise, but there’s plenty of specialist third parties who can help. Once the feed is in good shape, building a basic structure using the low, medium and high priority settings, allows advertisers to focus on top performing keywords and also separate brand and non-brand searches.
Secondly, advertisers can drive more clicks and increase conversion rates by enhancing campaigns. What’s crucial here is sharing data and insight from traditional text ad campaigns. How can you tailor product titles and descriptions according to what is performing well in the text ads? Supplemental feeds are helpful here, allowing you to make changes on the fly, without altering the main feed. You can introduce sales messaging like this too.
Finally, how can you differentiate yourself from the competition and optimize effectively? It’s worth thinking about what needs to be conveyed in a Shopping ad that isn’t shown in the image.such as a premium material or high thread count. All the time bearing in mind that Shopping is a numbers game and there should be a clear correlation between cost per click and return.
Where the optimisation point becomes really interesting is if an advertiser has physical stores as well as ecommerce sites. There are further gains to be had here with store visit tracking showing extremely strong results. The propensity for a user to click on a Shopping result and then visit the actual store is very high.
It’s evident that Google Shopping results are the new shop window, attracting qualified visits to both an advertiser’s website and physical stores, and that capitalizing on Shopping offers advertisers value beyond the last click ROI.
The case for testing Target ROAS bidding for AdWords shopping campaigns, plus tips on how to successfully set up such a test.
Read more at PPCHero.com
Starting this week, it will be easier than ever to get Product Ads that are running in Google AdWords, onto Bing.
Read more at PPCHero.com
In December 2017, Google released a set of statistics about the Christmas shopping season. Use these insights in AdWords to make this your best December ever.
Read more at PPCHero.com
Messaging app Viber earlier this year made its first foray into shopping services with Instant Shopping, a feature that lets you search for items for sale via a keyboard when you have the messaging app open. Today, the company is announcing some more e-commerce related news: it’s buying the startup that helped build that feature. Viber has acquired Chatter Commerce, maker of a… Read More
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