Is an intelligent vending machine a gimmiông chồng, or is there a concrete business reason for this surprising use of AI?


Every second, 10,000 drinks from the Coca Cola Company are consumed, making up nearly 2bn sales transactions a day over 200 countries. Because it has so much data, you’d probably assume Coca Cola uses AI extensively khổng lồ improve sầu its business.

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What you may not expect is that Coca Cola uses AI lớn create intelligent vending machines. An increasing number of these are equipped with touchscreens, wireless connectivity, and computing power.

Is an intelligent vending machine a gimmick, or another misstep (like New Coke, or wanting to lớn charge more for cold drinks on hot days)?

Or is there a rational business reason for this particular use of artificial intelligence?



Image courtesy of Freevector.comWhy Does Coca Cola Need AI?

The Coca Cola company produces about 3% of all the beverages consumed globally. Its distinctive sầu red and White biệu tượng công ty is recognised by over 90% of people in the world.

But maintaining this leadership position takes hard work, with huge investment in marketing. A few years back Coca Cola was spending more on advertising than Apple & Microsoft combined.

It relies on huge amounts of data lớn understvà why people are buying. It takes even more to figure out why they switch, and what makes them buy more. Nowadays, Coca Cola has an extensive product range. So gone are the days when success was mainly about getting people to lớn choose Coke over Pepđam mê.

There are similarities with other brand-conscious purchases such as trainers và luxury fashion. There may be some functional differences between competing products, but sales seem disproportionately dependent on attitudes to brands.

R&D is key to Coca Cola’s success, not just in products, but also understanding customers và brvà effectiveness. The volumes of data involved in the last two are immense. The relationship with buying patterns is complex, and is one of many compelling reasons Coca Cola uses AI.

AI is now fundamental khổng lồ Coca Cola’s business, something it acknowledges publicly:

AI is the foundation for everything we vày.

– Greg Chambers, Global Director of Digital Innovation, Coca Cola

Of course, there are also endless opportunities to use AI across the value chain, for example in distribution, logistics and manufacture. But a company lượt thích Coca Cola uses AI first và foremost lớn improve the customer and brand experience. Business functions that directly affect these are the biggest beneficiaries of AI.

What is an Intelligent Vending Machine?

There are three different aspects to lớn how Coca Cola uses AI in a vending machine. Each reflects one of the three main functions a vending machine fulfills:

A physical sales outlet at a location with high demand;A contact point with loyal customers; andA showcase of different product choices.

Success of each function is measured by different things. Understanding the data to lớn improve sầu that is not straightforward.

For example, how vị you choose the best location for a vending machine, and how bởi vì you decide when or if to move it? How bởi you persuade loyal customers to lớn buy more drinks, and reward them for doing so? And how vì you decide which drinks to lớn stock?

In many ways, this is a microcosm of what Starbucks đơn hàng with for every store it opens and runs. But of course, at a vending machine there are no staff around lớn vày anything needed.

So one way khổng lồ look at it, is that an intelligent vending machine should much of what you’d expect from a store, but automatically. The moment you break that down into lớn the data needed, AI starts to lớn make some sort of sense.

COCA COLA USES AI: To Determine the Best Location for Vending Machine

Using the Starbucks analogy again, deciding on the best location for a vending machine is something that can be modelled. This requires using location data, such as footfall, local economic indicators, và of course competitor information. There’s also going to be a toàn thân of comparison data from other machines.

Once a machine has been set up, understanding sales data is key. It’s used lớn validate how the machine is performing as a sales outlet compared to expectations. For this, it’s not enough lớn simply know drinks sales in a given period. So connectivity is a desirable feature, allowing data about sales to pass directly to lớn the company.

However, the power of what Starbucks và others bởi vì when evaluating a store’s performance is about much more than this. One key activity comes from more personalised insights inkhổng lồ the transactions. This is where loyalty schemes và apps are key.

Which is where the second function of the intelligent vending machine comes into play. But it’s only possible because the humble vending machine is part of the Internet of Things. i.e. it’s now a connected machine.

COCA COLA USES AI: To Engage with Loyal Customers

An intelligent vending machine should integrate with a company’s loyalty programme. If the loyalty scheme enables payment, the machine should accept more than just cash payments. And this is where Coke vending machines start lớn get more interesting.

In Japan, customers who use the “Coke On” điện thoại thông minh phầm mềm collect points when buying from the machine using their phone. Coke gets all the usual loyalty scheme benefits from this, primarily customer preference & buying data. And the customers are rewarded with a cash value for their points against future vending machine purchases.

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In other markets such as nước Australia, Coke trialled a different intelligent vending machine. I was again designed to encourage and reward loyalty while gathering customer & sales data. In this case, customers could use their phone to order drinks in advance, & collect them from the machine.

This kind of innovation isn’t just about connectivity — this time with a phone as well as the mạng internet. It’s also about having digital displays on the machine.

With both connectivity and a display, the opportunity for AI steps up further. This time, Coca Cola uses AI to turn the vending machine inkhổng lồ a fully-fledged “smart” device.

COCA COLA USES AI: To Showcase the Coke Br& & Products

Vending machines have sầu always been used as prominent signage points, promoting brands through posters. In recent times, these have sầu become more sophisticated. Digital displays allow the use of a variety of high quality images và videos in one place.

The Coca Cola vending machines take this much further, because of intelligence in the actual vending machine. This concept goes bachồng nearly a decade, lớn the company’s original “Freestyle” vending machines.

The first Freestyle machines allowed customers to decide exactly what drink they wanted from a wide range. The machine would create the exact chosen selection then và there. So a machine could offer up to lớn 200 variations on the base products, mixing và dispensing each as required.

The new generation of Freestyle machines have a large touchscreen — bigger than most home computers — & of course a di động app. But they also have sầu lots of dormant features khổng lồ be activated later, such as audio capability & optical sensors.

With this kind of hardware, connectivity & intelligence, the future opportunities for how Coca Cola uses AI seem only limited by the imagination.

The humble vending machine has become a smart device with the potential khổng lồ rival anything in the home. And in the process, it provides a rich source of data for Coca Cola.

It’s Not Just About the Data

Benefits go beyond cool features for producing drinks, và gathering sophisticated data. The intelligent vending machines demonstrate one more aspect of AI: personality.

When developing these machines, Coca Cola worked with a speciadanh mục chatbot company.

There are many similarities between the customer experience of interacting with a chatbot & buying a drink from a machine. But one that isn’t initially obvious is the concept of a chatbot personality.

The best chatbots are built with an appreciation of the brvà they represent, and the personality most appropriate for that brvà. Coca Cola has replicated this in their intelligent vending machines. But it’s also added the ability khổng lồ modify the personality to lớn reflect the machine’s location.

For example, a machine in a university campus could have a “fun” personality. Whereas the same machine in a hospital should probably be more sober in tone.

In other words, Coca Cola uses AI principles to lớn add emotional aspects of the customer experience inlớn a vending machine.

How Coca Cola Uses AI: Wrap-up và Lessons

At first glance, a vending machine with AI sounds like a gimmick. Perhaps images of a “Lost in Space” style robot come to lớn mind, exhorting Will Robinson khổng lồ drink more Coke.

But the picture changes when you start breaking down the function of a vending machine in business terms. It’s then only a short step lớn realising how AI supports và improves each of them.

Coca Cola uses AI in vending machine in a number of ways that improve sầu the business. These vary from using location data to lớn plan sales points, khổng lồ providing an innovative, personalised customer experience.

And we haven’t even mentioned even more curious references lớn Coca Cola vending machine. For example, testing Swedish customers’ knowledge of local dialects. And even the use of Augmented Reality!

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