In a recent RETHINK Retail interview, Aliyah Flowers sat down with Cédric Chereau, Managing Director at EagleAI, to explore how artificial intelligence (AI) is transforming retail. EagleAI, a company born in Europe nearly a decade ago, is revolutionizing the way high-frequency retailers engage with their customers.
The focus of EagleAI’s innovation? Hyper-personalized promotions that drive loyalty, improve customer experience, and directly impact retailers’ bottom lines. Here’s a deep dive into the conversation.
Tailoring Offers with Precision
“We’re addressing millions of customers today with unique offers designed just for them.”
Chereau explains that EagleAI specializes in personalized promotions for retailers, especially grocers and beauty brands, helping them target customers with one-to-one offers – something retailers have long struggled to do at scale, until recently. These offers, unlike traditional segmented promotions, are tailored to each customer based on their buying habits. “We’re addressing millions of customers today with unique offers designed just for them,” said Chereau. He emphasized that EagleAI’s approach can “reinforce customer loyalty” by offering incremental promotions on products they already purchase and love.
By providing this kind of highly relevant engagement, EagleAI helps retailers limit customer switching between stores while rewarding loyalty with targeted incentives. This model, which Chereau describes as “personalized challenges,” allows retailers to enhance customer loyalty without overwhelming shoppers with unnecessary discounts on items they might never consider buying.
Boosting Sales and Cutting Costs
“You don’t need to offer a 40% discount on a product someone already loves.”
AI-powered personalized promotions and challenges are not only effective, but they’re also efficient. When asked about the tangible impacts of AI on retailer performance, Chereau highlighted the fact that EagleAI’s personalization strategies reduce the cost of promotions by targeting discounts only on products that are most meaningful to individual customers. “You don’t need to offer a 40% discount on a product someone already loves,” he explained. Instead, retailers can achieve the same level of customer engagement with a much smaller discount on beloved products, thus saving costs. He cited notable examples such as Carrefour, Tesco, Woolworths, and Starbucks as success stories of AI in action.
This strategy also boosts sales. EagleAI predicts customers’ future spending on certain products and nudges them to buy just a little more from their preferred retailer, rather than splitting their purchases between competitors. As Chereau noted, “We know where you have headroom… we act on both sides: cost and revenue.”
The ROI of AI-Driven Personalization
On average, for every dollar spent on promotions, retailers see seven dollars in incremental sales.
One of the most compelling statistics Chereau shared was the return on investment (ROI) that retailers achieve when using EagleAI’s personalized challenges. On average, for every dollar spent on promotions, retailers see seven dollars in incremental sales, a 7:1 ROI. This return, he explained, is a result of the AI’s ability to control the difficulty of customer challenges, adjusting the required action to match the retailer’s goals. Retailers looking to grow their customer base can ease the challenges, while those focused on maximizing profit can increase the level of difficulty.
This flexibility ensures that retailers can maintain an optimal balance between recruiting new customers and driving profitability. “7:1 is a best practice,” Chereau remarked, noting that this figure strikes the right balance for both customer acquisition and long-term program profitability.
Purchase Frequency and Basket Size
The number of items customers purchase from their favorite brands rises by an average of 20%.
The benefits of AI-driven personalization go beyond just ROI. According to Chereau, retailers who implement personalized challenges see a significant impact on customer behavior. Customers participating in these programs tend to visit their favorite stores more often, leading to an extra basket per month—a major boost in shopping frequency. Additionally, the number of items customers purchase from their favorite brands rises by an average of 20%, further increasing the value of each shopping trip.
One example Chereau offered was the cross-promotion of related products. “If I’m buying pasta and see a challenge for my favorite pasta brand, I might also pick up pasta sauce,” he explained. This kind of promotion helps brands increase the number of items customers add to their carts, directly impacting sales.
Overcoming the Implementation Gap
While AI’s potential is immense, Chereau acknowledged that many retailers struggle with implementing personalization strategies at scale, especially those with omnichannel operations. Personalizing offers for millions of customers is a daunting task, and some of the world’s largest retailers have encountered significant hurdles along the way. “The implementation gap is something very serious,” he said, noting that EagleAI works closely with retailers to bridge that gap.
Retailers with well-executed AI strategies see participation rates in their loyalty programs up to 10 times higher than those without personalization.
For retailers who manage to successfully close the implementation gap, the rewards are substantial. According to Chereau, retailers with well-executed AI strategies see participation rates in their loyalty programs up to 10 times higher than those without personalization.
The Future of AI in Retail
Looking ahead, Chereau believes that the role of AI in retail will continue to expand. While digital retailers already leverage extensive customer data to personalize shopping experiences, brick-and-mortar stores have yet to fully unlock AI’s potential. “We are just at the beginning,” Chereau noted, envisioning a future where physical stores use AI to personalize experiences down to the individual level. With more data being collected and smarter ways to use it, the retail landscape is on the verge of a transformation driven by AI.
In the coming years, AI will help retailers create even more tailored shopping experiences, from personalized promotions to inventory management. As Chereau explained, “AI will completely change the world of high-frequency retailers.”
To read more about EagleAI, visit their website or sign up to receive a copy of their exclusive eBook, AI and the Current State of Retail Marketing, to discover how to overcome the challenges and unlock AI’s full potential for your business.
