Family Dollar using AI for customer-driven merchandising
Family Dollar is leveraging artificial intelligence to enable customer-centric category management.
The discount retailer will deploy the dunnhumby AI-based category management and merchandising collaboration platform across its entire network of stores. As a result, Family Dollar intends to make faster, more informed and more customer-centric decisions in collaboration with its CPG partners.
Family Dollar will build its category management and merchandising solution on two key platforms. These include an AI-based assortment solution that employs predictive analytics to quantify which products should be selected for each store before forecasting the impact of assortment changes across every location.
The retailer is also rolling out dunnhumby Shop, a web-based AI-equipped data tool designed to deliver comprehensive aggregated insights about shopper behavior and deliver the latest category trends. Family Dollar seeks to localize assortments to deliver the right assortments at exactly the right time.
"Understanding and listening to what our customers want is at the very core of our mission to meet and exceed the needs of our shoppers," said Larry Gatta, chief merchandising officer for Family Dollar. "With our new category and merchandising platform powered by dunnhumby, we can tailor and fine tune our assortments to local purchasing preferences, to ensure we provide our customers with the products they need at each of our stores."
Family Dollar is also leveraging predictive analytics technology and actionable data from First Insight in an effort to offer merchandise aligned with the most current consumer expectations and shifts in the market.
The retailer hopes the solution will enable it to successfully launch new products, as well as reduce markdowns and stock shortages while curbing the influx of underperforming products. The retailer seeks to support its strategy of driving sales across all categories with value pricing.
[READ MORE: Family Dollar optimizes assortment with predictive analytics]
"The entire dunnhumby team is honored to be selected by Family Dollar, after a competitive review, as their strategic partner for category management and merchandising," said Matt O’Grady, president of the Americas for dunnhumby. "In today’s hyper competitive retail environment, Family Dollar recognizes that putting their customers first is crucial for growth and customer retention."
Family Dollar parent company Dollar Tree, a Fortune 200 company, operated more than 16,300 stores across 48 states and five Canadian provinces as of Oct. 28, 2023. Stores operate under the brands of Dollar Tree, Family Dollar and Dollar Tree Canada.
