Artificial intelligence could be the next mall cop
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Illustration: Maura Losch/Axios
A trio of companies are working on tech that may help retailers foil thieves and grow their bottom line.
What's happening: Josh Sommer, VP of growth and development for Cox Communications, announced a collaboration with Dell Technologies and EPIC iO on Monday at the annual NWA Tech Summit.
Why it matters: The technology could save retailers millions of dollars by identifying the top products that are stolen and areas within a store where theft most commonly occurs.
- It also could help stores tweak their layouts and displays to drive more sales, Sommer told Axios.
The big picture: Shrinkage — the loss of inventory through theft, damage or miscounting — cost retailers $94.5 billion in 2021, the National Retail Federation estimates. That's skyrocketed from an estimated $61.7 billion in 2019 and $50.6 billion in 2018.
- In addition to shoplifting and high-profile organized crime, NRF says checkout errors and label switching account for an average of 1.4% of inventory shrink.
How it works: The Cox Communications computer vision for retail analytics combines Dell hardware, EPIC artificial intelligence and Cox's connectivity to the cloud.
- Sommer described a consultancy period where Cox would work with retailers and teach the system to identify products — say, pricey batteries.
- More than just noting an item was plucked from the shelf, the system would also know how much it costs and whether it was properly scanned and purchased.
- If it's discounted by the cashier (the "friend price") or pocketed between pluck and exit, a notification would be sent to someone at the store.
Details: In a conversation with Axios, Sommer said a shoebox-sized computer would be linked to cameras throughout a store.
- The device drives the software, but data collected is stored on Cox's cloud so companies can crunch it and look for trends.
- Different retailers will have different requirements, Sommer said. Some will want to own the hardware; others will want Cox to manage the entire system.
What's next: The companies are looking to sign the first client.
- An ideal retailer would be "mid-market," Sommer said, adding that a chain with about 100 stores would be a sweet spot.
Editor's note: Cox Enterprises, the parent company to Cox Communications, also owns Axios.