Israeli innovators transform how the world buys and sells

Israeli tech start-ups are creating huge waves in the way the world buys and sells.

MAY 13, 2019 03:55

Empty shopping carts are seen before the Black Friday sales event on Thanksgiving Day. (photo credit: REUTERS) — Empty shopping carts are seen before the Black Friday sales event on Thanksgiving Day.

(photo credit: REUTERS)

While many are currently anticipating the arrival of e-commerce behemoth Amazon into Israel for the first time, over 250 start-ups led by Israeli entrepreneurs are busy transforming the way the world buys and sells.

Whether it’s transforming mobile shopping, digitizing supermarket shelves or creating autonomous stores, innovators are leveraging cutting-edge technologies to disrupt the $30 trillion global retail market.

Brothers Michael and Daniel Gabay founded autonomous retail store developer Trigo Vision after serving in the IDF’s most elite data science and intelligence units.

Trigo Vision co-founders Michael Gabay (L) and Daniel Gabay (PR)

Surprised by the huge gap between retail operations and the military technologies they developed and managed, they set out to drive brick-and-mortar stores into a more modern future.

“Supermarkets started using bar codes in the 1970s, and 50 years later they are still using bar codes,” chief executive Michael told The Jerusalem Post. “In my mind, there has to be something else to solve this problem.”

Similar to Amazon Go’s convenience store concept, Trigo installs a discreet camera network which identifies customers via their smartphone and uses advanced algorithms to track their product selection, enabling automated billing and no need to stand in line at the checkout.

For customers who do not wish to register for automatic identification, a payment screen will be available prior to exiting the supermarket.

“Whereas Amazon is building everything from scratch to implement their new technology, we are converting existing supermarkets to new autonomous stores,” he said.

“All the stores that we’re going to open are bigger than Amazon Go stores. We’ll be working in supermarkets.”

Trigo is currently undergoing multiple pilot projects and training its system in Israeli supermarket chain Shufersal and a number of major international retailers. The company, which has raised $7 million in funding, expects to launch its first autonomous store in 2020.

“While this idea has been around for a long time, today we have the capabilities to implement these kinds of AI and computer vision technologies,” said Michael.

In addition to checkout-free shopping providing an enjoyable customer experience, Trigo’s solution also offers further advantages to retailers, including real-time shelf and inventory updates, prevention of shoplifting and customer behavior insights.

“The demand today in the market is crazy for this kind of solution. Our mission is to open the stores as fast as we can, and deliver this kind of new technology around the world.”

TRAX RETAIL is the rapidly-growing computer vision brainchild of Joel Bar-El and Dror Feldheim, two Israelis who met in Singapore.

Using image recognition and deep learning technology, Trax Retail aims to provide brick-and-mortar stores with the same understandings and insights of customer interaction as their e-commerce partners and rivals.

An illustration of Trax Retail's computer vision supermarket solution (Credit: PR)

The company gathers images of store shelves captured from a range of sources, including unimposing shelf-mounted cameras, mobile apps and even robots, to digitize every item or object in-store, enabling every stock keeping unit (SKU) to be tracked.

Mark Cook, vice-president of product at Trax, told the Post that the company has two customer bases: manufacturers and retailers.

“For manufacturers, we go into stores, take photos of the shelves and compute key performance indicators (KPIs) from that. Manufacturers are fighting for share-of-shelf, and our product is used to validate that they are receiving their necessary share,” said Cook. “For retailers, instead of relying on images from the field, we put fixed cameras in the stores – and we’re continuously monitoring the store shelf at that point. If something runs out of stock, you can immediately alert a store associate and change replenishment strategies.”

On average, retailers are out of stock approximately 8% of the time, resulting in a significant loss of revenue and customer dissatisfaction. Trax says its system can reduce product unavailability by more than half.

Trax’s research and development hub, located in Tel Aviv, employs approximately 150 engineers.

“As retailers and manufacturers embark on a digital transformation, they want to enable new experiences based on having granular data about what’s happening at the SKU-person interaction level,” Cook said. “In order to that, you need to digitize the physical asset.” He highlighted possible indoor supermarket navigation to desired products.

In 2016, Deloitte ranked Trax in the top 25 fastest growing companies in its Technology Fast 500 list. Today, the company serves about 85 clients in 45 different countries, including Heineken, Coca-Cola, Nestlé and Shufersal.

HI-TECH veteran Roy Ittah founded Ashdod-based mobile shopping platform SuperUp in 2015 after recognizing that little has changed in e-commerce in the past two decades. SuperUp’s ambition is no less than to “change the face of mobile shopping.”

While up to 70% of Internet traffic occurs on mobile devices, driven by millennials and Generation Z, the smartphone e-commerce conversion rate (purchases per visit) stands at just 1.84% – less than half of the desktop conversion rate.

By making the mobile shopping experience more straightforward, entertaining and enjoyable, SuperUp aims to boost performance for all stakeholders – consumers, retailers, agencies and brands.

“I noticed that compared to the physical experience in supermarkets, which is vivid, dynamic, social and involving a lot of our senses, the digital shopping experience is very technical and tedious – you lose everything,” Ittah told the Post.

“At the start, it seemed almost impossible to come up with something that makes sense to everybody. The model is built on challenges faced by each player.”

SuperUp CEO Roy Ittah (C) with team members (Credit: PR)

SuperUp’s bold but straightforward “eComMarketing” platform, easily personalized for every outlet, uses artificial intelligence to personalize the shopper’s journey by surfacing relevant products based on his purchasing preferences.

Even when shopping for a large basket of groceries, the platform showcases just one product at a time.

“The results of this platform in terms of performance are three to five times the normal mobile conversion rates, and a huge number of items in the average shopping basket. It’s now practical for even complex customer journeys to be completed on mobile,” said Ittah.

In addition to a more user-friendly shopping experience, SuperUp’s patented data apparatus combines consumer behavior with product profiling to offer stakeholders valuable insights into shopping habits. The platform also enables brands to advertise at the prime moment of product choice in a personalized manner, enabling retailers to boost sales and boost advertising revenues.

An illustration of SuperUp's mobile shopping platform (Credit: PR)

SuperUp’s first customer was the A.S. Watson Group, the world’s largest health and beauty retailer. In the coming months, the company will roll out its platform with retailers located in Israel, Germany, Mexico and Brazil.

“I believe we have managed to solve some very tough challenges in this industry, especially how to create an effective shopping experience on mobile,” said Ittah.

“We believe our platform’s experience will become the new standard of how purchasing on mobile should look and feel like.