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Could CPGs Use AI Against Amazon?

Amazon has become the face of the modern retail industry, for better or worse. I do very much love the convenience shopping online with Amazon offers, but it seems like the more time passes, the more homogenized the retail sector becomes. Amazon is developing their own store brands for a variety of products, or otherwise absorbing other brands into itself. Their AmazonBasics line, while exceptionally… basic, are competently assembled, readily available, and above all, cheap. How are the rest of the world’s brands supposed to compete with that, especially when they need Amazon to handle things like delivery and consumer statistics? The answer may be in artificial intelligence.

Most producers of consumer packaged goods (or CPGs) do exactly one thing, make stuff, and do it well. They don’t have the manpower or infrastructure Amazon has that would allow them to cut out middlemen and deliver their products directly to customers for reasonable prices. AI could, at least in theory, alleviate some of these burdens, giving CPG producers a shot at flying solo.

Credit: project44

A competently-written AI program could handle all manner of tasks that are vital to an online storefront. This includes things like inventory management, delivery schedules, and management of customer demographic data. That last one is especially important, as demographic data is how Amazon is able to strike particular markets so precisely. If a CPG producer could get a read on their ideal customer, and the AI handles all of the minutiae, it would free up money and manpower to developing online platforms and shipping product out to where it needs to go to maximize profit.

Of course, a change like this wouldn’t happen overnight, and Amazon sure as sugar wouldn’t take it lying down. But hey, a little healthy competition is supposed to be the cornerstone of capitalism. Amazon’s got their own advantages, so why not give the little guys a little extra muscle?


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