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Kroger

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Hello World is a weekly newsletter—delivered every Saturday morning—that goes deep into our original reporting and the questions we put to big thinkers in the field. . Browse the archive here Hi, everyone, I’m Ryan Tate, an editor here at The Markup. It’s Saturday morning, and I’d like to talk about your most mundane daily experiences, and how to keep them boring and harmless. . . . Jon Keegan, one of our reporters at The Markup, has carefully documented how these common human experiences now put people’s most sensitive data at risk for harvesting by strangers. That’s because companies in seemingly every industry—from automakers to app creators to political campaigns—now believe they can make money off tracking their users. Driving a car Looking at your phone Voting “Everyone’s a data broker now,” Jon told me recently, quoting a friend. That’s so true, it hurts. In 2021, Jon about the multibillion-dollar market for your phone’s location data. He then stepped back and started looking at various ways our personal information leaks out in day-to-day life—data sinks we are vaguely aware of but don’t scrutinize. After cars and political ads, supermarkets seemed like a natural next step. wrote Jon told me he always pauses at checkout at the supermarket and doesn’t share his phone number to use his family’s loyalty program membership, leaving real money on the table and causing an ongoing argument with his wife. Skipping out on discounts? In this economy? While the entire tech journalism industry is focused on probing the potential sentience of AI-powered chatbots, Jon suspected that everyday supermarket data was an underreported topic that was due for fresh inspection. Based on his prior reporting on how consumer data is bought, sold, and traded with few limitations, Jon theorized that supermarkets today are likely gathering more data about us than ever before. Loyalty card programs, after all, go back to before smartphones and before ubiquitous online tracking, back to before billions of dollars could be made from data collection. He wondered: How have supermarket discount programs evolved? Jon accelerated his research in the following weeks, paying particular attention to the two largest supermarket chains, Kroger and Albertsons, which had proposed merging into the nation’s largest supermarket chain. Politicians and advocacy groups were worried the merger would drive up food prices, drive down wages, and result in a massive, highly sellable, pool of sensitive data about shoppers. (Albertsons told us that “we appreciate the importance of privacy and take appropriate handling of our customers’ data seriously” and that it had recently updated its privacy policy. Kroger did not respond to Jon’s requests for comments.) , including those for other brands the company owns, like Ralphs and Food 4 Less, help collect information that goes well beyond the list of items in your  shopping cart. The company “enriches” information it has on what you buy and who you are with additional data. Jon found that Kroger loyalty programs Some of this data is acquired from brokers, some comes from Kroger apps, some of it comes from Bluetooth beacons and facial recognition systems in stores. Some is even systematically inferred from all the other data. Drawing from these sources, Kroger can collect your financial information, including bank and credit card account numbers; track demographic data, including race, ethnicity, age, and employment information; make inferences about your health and behavior; track your precise physical location in the store if you consent; and recognize your face in select locations, with signs providing notice. Jon also found that Kroger had two business units focused on making money from all the information Kroger collects. One, known as Kroger Precision Marketing, sells advertising to product makers, not only in stores, per long-standing industry practice, but also by following shoppers onto the internet, their smartphones, and their home entertainment devices. Kroger’s other data-related business carries the startup-like name 84.51, corresponding to the longitude of Kroger headquarters in Cincinnati, Ohio. This unit sells information and “insights” gleaned from what the company describes as “35+ petabytes” of customer data. (That’s the equivalent of several million downloads of the film “Black Panther: Wakanda Forever,” in case you were wondering.) Kroger sees 84.51 and Kroger Precision Marketing as key sources of growth. These units, along with a personal finance division, are part of its “alternative profit business,” offering much higher margins than selling produce and canned goods. A promotional presentation about the Kroger-Albertsons merger (see page 18 ) shows that the company believes these types of business units are worth “+$1B Annual Alternative Profits” to “Kroger Today” and represent a “~$1.5B Annual Alternative Profits Opportunity” to Kroger and Albertsons combined. here That would be big growth from the $150 million in incremental operating profits Kroger derived from these businesses in 2021. Clearly, Kroger is as excited about monetizing shopper data as it is about selling groceries. The ad industry is excited, too. As Jon was putting the finishing touches on his story, I spent a day earlier this month at the AdExchanger Industry Preview event in New York. Industry players at the conference are grappling with major challenges, including economic headwinds that have seen many ad budgets slashed and privacy concerns that could bring new regulations. (Our editor-in-chief, Sisi Wei, who you heard from a few weeks ago, wrote about being how advertisers could limit their data collection.) invited to the event and explaining But advertising sold by supermarkets and other stores, categorized as “retail media” to the people at the conference, emerged as a clear industry bright spot, alongside ads for video streaming services like Netflix. Over and over again people on stage talked about how effective it was to buy ads from retailers like Amazon, Walmart, and Kroger, and how it paid to leverage their customer data. One executive, Jed Dederick of ad-buying platform The Trade Desk, explained that retailers sometimes know more about how to reach a company’s likely customers with online ads than the company itself. Two speakers from Arete Research highlighted retail media as the industry’s fastest-growing segment. Retail media “are outgrowing all other forms of advertising in ’22” by 10 percentage points or more, said analyst Rocco Strauss, “and will likely do so again in 2023.” If the power and extent of shopper tracking is taken as a given in the ad industry, it still seems to be news to the shoppers themselves. When Jon’s story , it caused a minor sensation. Jon was by NPR’s “All Things Considered,” and his revelations were by Business Insider, by The Washington Post, and on the techno-political podcast “This Machine Kills”. published last week interviewed about his findings written up highlighted featured I know that while Jon appreciates that sort of impact, what he really wants is to find out precisely what information the supermarkets are collecting, and if any of it is potentially harmful. You can help him. If you’re a frequent shopper at a , and a Kroger Plus or Boost member in California or Virginia and want to help find out what Kroger has, email Jon at . Kroger-owned supermarket keegan@themarkup.org And if you’re wondering, Jon still refuses to hand over his number at the checkout, much to his wife’s annoyance. Cheers, Ryan Tate Editor The Markup P.S. In case you missed it, I also wanted to share two important pieces that we published this week. First, into how L.A.’s scoring system for subsidized housing gives Black and Latino people experiencing homeless lower priority scores, along with scoring in other cities. our investigation our tips for how to investigate We’ll dive more deeply into this investigation with you next week. Second, we released a tool this week called the (USPS), which lets you easily sample random U.S. street addresses without knowing how to code. Soon, we will be releasing a guide on how to replicate in other American towns and cities using USPS. United States Place Sampler our investigation into internet disparities By Ryan Tate Also published here Photo by on Hanson Lu Unsplash

How Much Data Are Supermarkets Like Kroger Collecting?

This article is coreported with KFF Health News KFF Health News Read on our collaborator's site Read on our collaborator's site This article was coreported with KFF Health News, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF. Sign up for KFF Health News’s newsletters. This article was coreported with KFF Health News, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF. Sign up for KFF Health News’s newsletters. KFF Health News’s newsletters Looking for an at-home HIV test on CVS’s website is not as private an experience as one might think. An investigation by The Markup and KFF Health News found trackers on CVS.com telling some of the biggest social media and advertising platforms the products customers viewed. And CVS is not the only pharmacy sharing this kind of sensitive data. We found trackers collecting browsing- and purchase-related data on websites of 12 of the U.S.’s biggest drugstores, including grocery store chains with pharmacies, and sharing the sensitive information with companies like Meta (formerly Facebook), Google, through its advertising and analytics products, and Microsoft, through its search engine, Bing. The tracking tools, popularly called “pixels,” collect information while a website runs. That information is often sent to social media firms and used to target ads, either to you personally or to groups of people that resemble you in demographics or habits. In previous investigations, The Markup found pixels transmitting information from the U.S. Department of Education, prominent hospitals, telehealth startups, and major tax preparation companies. the U.S. Department of Education prominent hospitals telehealth startups major tax preparation companies Pharmacy retailer websites’ pixels send a shopper’s IP address—a sort of mailing address for a person’s computer or household internet—to social media giants and other firms. They also send cookies, a way of storing information in a user’s browser that in this case helps track a user from page to page as the user browses a retailer’s site. Cookies can sometimes also associate individuals on a site with their account on a social media platform. In addition to the IP address and cookies, the pixels often send information about what you’ve clicked or bought, including sensitive items such as HIV tests. “HIV testing is the gateway to HIV prevention and treatment services,” said Oni Blackstock, the founder of Health Justice and a former assistant commissioner for New York City’s Bureau of HIV/AIDS Prevention and Control, in an interview. “People living with HIV should have control over whether someone knows their status,” she said. Many retailers shared other detailed interaction data with advertising platforms as well. Ten of the retailers we examined alerted at least one tech platform when shoppers clicked “add to cart” as they shopped for retail goods, a capacious category that included sensitive products like prenatal vitamins, pregnancy tests, and Plan B emergency contraception. Supermarket giant Kroger, for instance, informed Meta, Bing, Twitter, Snapchat, and Pinterest when a shopper added Plan B to the cart, and informed Google and Nextdoor, a social media platform on which people from the same neighborhood gather in forums, that a shopper had visited the page for the item. Walmart informed Google’s advertising service when a shopper browsed the page of an HIV test, and Pinterest when that shopper added it to the cart. A previous investigation from The Markup found that Kroger used loyalty cards to track, analyze, and sell an array of data about customers to advertisers. previous investigation Using Chrome DevTools, a tool built into Google’s Chrome browser, The Markup and KFF Health News visited the websites of 12 of the U.S.’s biggest drugstores and examined their network traffic. This monitoring tool allowed us to see what information about shopping habits and, in some cases, prescriptions were sent to third parties. Over the course of the investigation, retailers frequently changed their trackers—sometimes activating them, sometimes removing them. Some retailers appeared to be taking steps to limit tracking on sensitive items. For example, Walgreens’ website prevented some trackers from activating on the pages of some products, which included Plan B and HIV tests. This code didn’t prevent all tracking, though: Walgreens’ site continued sending Pinterest information about those sensitive items a user added to the cart. Walgreens shared a new policy after learning of The Markup and KFF Health News’s findings. Spokesperson Fraser Engerman said that while the chain already had a “robust privacy program,” it would no longer share browsing data related to reproductive health and HIV testing. Engerman also told us that “Pinterest confirmed that the data will be deleted and that it has not been used for advertising purposes.” Crystal Espinosa, a spokesperson for Pinterest, said the company “can confirm that we will be deleting the data Walgreens requested.” The Pharmacy vs. the Pharmacy Aisle In the U.S., drugstores and grocery stores with associated pharmacies are only partially covered by the Health Insurance Portability and Accountability Act, or HIPAA. The prescriptions picked up from the pharmacy counter do have this protection. But in a separate section, sometimes confusingly called the pharmacy aisle, stores also often sell over-the-counter medications, tests, and other health-related products. Consumers might think such purchases have similar protections to their prescriptions, but HIPAA only covers the pharmacy counter’s clinical operations, such as dispensing prescriptions and answering patients’ questions about medication. This distinction can be confusing enough inside the brick-and-mortar location of a retailer. But the line can become even harder to make out on a website, which lacks the clarifying delineations of physical space. What’s more, descriptions about what will happen with retail data are generally in retailers’ privacy policies, which can usually be found in a link at the bottom of their webpages. The Markup and KFF Health News found them murky at best, and none of them were specific about the parts of the site that were covered by HIPAA and the parts that weren’t. In the “Privacy Notice for California Residents” part of its privacy policy, Kroger says it processes “personal information collected and analyzed concerning a consumer’s health.” But, the policy continues, the company does not “sell or share” that information. Other information is sold: According to the policy, in the last 12 months, the company sold or shared “protected classification characteristics” to outside entities like data brokers. privacy policy Kroger spokesperson Erin Rolfes said the company strives to be transparent and that “[i]n many cases, we have provided more information to our customers in our privacy notices than our peers.” Brokering of general retail data is widespread. Our investigation found, though, that some websites shared sensitive clinical data with third parties even when that information would be protected at a HIPAA-covered pharmacy counter. Users attempting to schedule a vaccine appointment at Rite Aid, for example, must answer a survey first to gauge eligibility. This investigation found that Rite Aid has sent Facebook responses to questions such as: Do you have a neurological disorder such as seizures or other disorders that affect the brain or have had a disorder that resulted from a vaccine?
Do you have cancer, leukemia, AIDS, or any other immune system problem?
Are you pregnant or could you become pregnant in the next three months? Do you have a neurological disorder such as seizures or other disorders that affect the brain or have had a disorder that resulted from a vaccine? Do you have cancer, leukemia, AIDS, or any other immune system problem? Are you pregnant or could you become pregnant in the next three months? The Markup and KFF Health News documented Rite Aid sharing this data with Facebook in December 2022. In February of this year, a proposed class action lawsuit based on similar findings was filed against the drugstore chain in California, alleging code on Rite Aid’s website sent Facebook the time of an appointment and an identifier for the appointment location, demographic information, and answers to questions about vaccination history and health conditions. Rite Aid has moved to dismiss the suit. proposed class action After the lawsuit was filed, The Markup and KFF Health News tested Rite Aid’s website again, and it was no longer sending answers to vaccination questions to Facebook. Rite Aid isn’t the only company that sent answers to eligibility questionnaires to social media firms. Supermarkets Albertsons, Acme, and Safeway, which are owned by the same parent company, also sent answers to questions in their vaccination intake form—albeit in a format that requires cross-referencing the questionnaire’s source code to reveal the meaning of the data. Using the Firefox web browser’s Network Monitor tool, and with the help of a patient with an active prescription at Rite Aid, KFF Health News and The Markup also found Rite Aid sending the names of patients’ specific prescriptions to Facebook. Rite Aid kept sharing prescription names even after the company stopped sharing answers to vaccination questions in response to the proposed class action (which did not mention the sharing of prescription information). Rite Aid did not respond to requests for comment, and as of June 23, the pixel was still present and sending the names of prescriptions to Facebook. Network Monitor Other companies shared data about medications from other parts of their sites. Customers of Sam’s Club and Costco, for example, can search names of prescriptions on each retailer’s website to find the local pharmacy with the cheapest prices. But the two websites also sent the name of the medication the user searched for, along with the user’s IP address, to social media companies. Many of the retailers The Markup and KFF Health News looked at did not respond to questions or declined to comment, including Costco and Sam’s Club. Albertsons said the company “continually” evaluates its privacy practices. CVS said it was compliant with “applicable laws.” Kroger’s Rolfes wrote that the company’s “trackers disclose product information, which is not sensitive health information unless one or more inferences are made. Kroger does not make any inferences linking the product information collected or disclosed by trackers to an individual’s health condition.” A Huge Regulatory Challenge Pharmacies are just one facet of a huge health care sector. But the industry as a whole has been roiled by disclosures of tracking pixels picking up sensitive clinical data. After an investigation by The Markup in June 2022 found widespread use of trackers on hospital websites, regulatory and legal attention has homed in on the practice. found widespread use of trackers In December, the Department of Health and Human Services’ Office for Civil Rights published guidance advising health providers and insurers how pixel trackers’ use can be consistent with HIPAA. “Regulated entities are not permitted to use tracking technologies in a manner that would result in impermissible disclosures” of protected health information to tracking technology or other third-party vendors, according to the official bulletin. published guidance If implemented, the guidance would provide a path for the agency to regulate hospitals and other providers and fine those who don’t follow it. In an interview with an industry publication in late April, the director of the Office for Civil Rights said it would be bringing its first enforcement action for pixel use “hopefully soon.” bringing its first enforcement action Lobbying groups are seeking to confine any regulatory fallout: The American Hospital Association, for example, sent a letter on May 22 to the Office for Civil Rights asking that the agency “suspend or amend” its guidance. The office, it claimed, was seeking to protect too much data. asking that the agency This year the Federal Trade Commission has pursued action against companies like GoodRx, which offers prescription price comparisons, and BetterHelp, which offers online therapy, for alleged misuse of data from questionnaires and searches. The companies settled with the agency. companies like GoodRx BetterHelp Health care providers have disclosed to the federal government the potential leakage of nearly 10 million patients’ data to various advertising partners, according to a review by The Markup and KFF Health News of breach notification letters and the Office of Civil Rights’ online database of breaches. That figure could be a low estimate: A new study in the journal Health Affairs found that, as of 2021, almost 99 percent of hospital websites contained tracking technologies. 99 percent of hospital websites One prominent law firm, BakerHostetler, is defending hospitals in 26 legal actions related to the use of tracking technologies, lawyer Paul Karlsgodt, a partner at the firm, said during a webinar this year. “We’ve seen an absolute eruption of cases,” he said. during a webinar Abortion and pregnancy-related data is particularly sensitive and driving regulatory scrutiny. In the same webinar, Lynn Sessions, also with BakerHostetler, said the California attorney general’s office had made specific investigative requests to one of the firm’s clients about whether the client was sharing reproductive health data. It’s unclear whether big tech companies have much interest in helping secure health data. Sessions said BakerHostetler had been trying to get Google and Meta to sign so-called business associate agreements. These agreements would bring the companies under the HIPAA regulatory umbrella, at least when handling data on behalf of hospital clients. “Both of them, at least at this juncture, have not been accommodating in doing that,” Sessions said. Google Analytics’ help page for HIPAA instructs customers to “refrain from using Google Analytics in any way that may create obligations under HIPAA for Google.” help page for HIPAA Meta says it has tools that attempt to prevent the transfer of sensitive information like health data. In a November 2022 letter to Sen. Mark Warner (D-VA) obtained by KFF Health News and The Markup, Meta wrote that “the filtering mechanism is designed to prevent that data from being ingested into our ads.” What’s more, the letter noted, the tech giant reaches out to companies transferring potentially sensitive data and asks them to “evaluate their implementation.” November 2022 letter “I remain concerned the company is too passive in allowing individual developers to determine what is considered sensitive health data that should remain private,” Warner told The Markup and KFF Health News. Meta’s claims in its letter to Warner have been repeatedly questioned. In 2020, the company itself acknowledged to New York State regulators that the filtering system was “not yet operating with complete accuracy.” acknowledged to New York State regulators To test the filtering system, Sven Carlsson and Sascha Granberg, reporters for SR Ekot in Sweden, set up a dummy pharmacy website in Swedish, which sent fake, but plausible, health data to Facebook to see whether the company’s filtering systems worked as stated. “We weren’t warned” by Facebook, Carlsson said in an interview with KFF Health News and The Markup. set up a dummy pharmacy website Carlsson’s and Granberg’s work also found European pharmacies engaged in activities similar to what The Markup and KFF Health News have found. The reporters caught a Swedish state-owned pharmacy sending data to Facebook. And a recent investigation with The Guardian found the U.K.-based pharmacy chain LloydsPharmacy was sending sensitive data—including information about symptoms—to TikTok and Facebook. sending data to Facebook recent investigation In response to questions from KFF Health News and The Markup, Meta spokesperson Emil Vazquez said, “Advertisers should not send sensitive information about people through our Business Tools. Doing so is against our policies and we educate advertisers on properly setting up Business Tools to prevent this from occurring. Our system is designed to filter out potentially sensitive data it is able to detect.” Meta did not respond to questions about whether it considered any of the information KFF Health News and The Markup found retailers sending to be “sensitive information,” whether any was actually filtered by the system, or whether Meta could provide metrics demonstrating the current accuracy of the system. In response to our inquiries, Twitter sent a poop emoji, while TikTok and Pinterest said they had policies instructing advertisers not to pass on sensitive information. LinkedIn and Nextdoor did not respond. Google spokesperson Jackie Berté said the company’s policies “prohibit businesses from using sensitive health information to target and serve ads” and that it worked to prevent such information from being used in advertising, using a “combination of algorithmic and human review” to remedy violations of its policy. KFF Health News and The Markup presented Google with screenshots of its pixel sending the search company our browsing information when we landed on the retailers’ pages where we could purchase an HIV test and prenatal vitamins, and of data showing when we added an HIV test to the cart. In response, Berté said the company had “not uncovered any evidence that the businesses in the screenshots are violating our policies.” Editor’s Note: KFF Health News uses Meta’s pixel on its website to collect information that may be used by third-party websites to measure web traffic and performance data and to target ads on social platforms. You can read KFF’s privacy policy in its entirety. The Markup does not use Meta’s pixel or similar trackers. You can read our full privacy promise here. Editor’s Note: KFF’s privacy policy here Credits: Darius Tahir for KFF Health News, Simon Fondrie-Teitler Credits: Darius Tahir for KFF Health News, Simon Fondrie-Teitler Darius Tahir Simon Fondrie-Teitler Also published here Also published here here Photo by Amanda Dalbjörn on Unsplash Photo by Amanda Dalbjörn on Unsplash Amanda Dalbjörn Unsplash

Need to Buy Plan B or an HIV Test? Facebook Already Knows About It

As the world becomes increasingly digital, businesses across industries—from retail to finance and automotive—must handle massive volumes of data. Whether managing product catalogs, processing telemetry data, or handling financial transactions, the ability to manage and scale real-time data across multiple regions is critical for global operations. One expert leading the way in solving these data management challenges is Amey Banarse, a solutions engineer with over a decade of experience in distributed database technologies. Amey uses his expertise to solve complex data challenges, reduce costs, and improve performance. His work has led to successful collaborations with Fortune 500 enterprises, including global financial institutions like Wells Fargo and Fiserv, large retailers like Kroger, and automotive companies including General Motors, making him a prominent figure in the field. The Challenges of Data Management in the Digital Age Coordinating large amounts of information presents a unique challenge in the modern world. Technological breakthroughs like real-time analytics and machine learning have provided immense benefits, but these advancements also introduce new obstacles, such as the need for low-latency access and maintaining consistent data availability across regions. Amey Banarse shares his insights into overcoming these challenges and the journey that led him to become an expert in the field. Q: Amey, what inspired you to pursue a career in technical solutions engineering? A: My journey began with a Master’s degree from the University of Pennsylvania in 2010. I started my career as a Senior Data Analytics Consultant at Gemini Systems, New York, where I focused on data analytics platforms in the financial services sector. Collaborating with high-profile clients like the New York Stock Exchange (NYSE) to develop solutions and working on high-impact projects sparked my passion for data management. It was during my collaboration with the Financial Industry Regulatory Authority (FINRA) that I truly recognized the critical importance of robust data architecture. Today, as a recognized thought leader in the data industry, I combine deep expertise in distributed systems and cloud-native transactional applications with a commitment to advancing enterprise data innovation. I am honored to contribute to the leading forums like Forbes Technology Council sharing insights through writing, presentations, and thought leadership. My speaking engagements at premier conferences like AWS ReInvent, VMWare Explore, and SpringOne reflect my dedication to shaping industry discourse, from modern data architectures to enterprise data strategies, helping organizations unlock the full potential of their data assets. Q: As industries face the increasing demand for real-time data processing, what challenges are they encountering? A: Today’s businesses, especially in sectors and developing industries like retail, automotive and finance, must manage massive volumes of real-time data while ensuring security and scalability. Challenges include handling traffic surges during peak periods, maintaining data integrity across geographically distributed systems, and providing consistent performance. Failure to address these issues can lead to bottlenecks, data inconsistencies, and operational inefficiencies that significantly impact customer experience and revenue. Q: Can you share your approach to solving these challenges using distributed database technologies? A: Absolutely. I leverage technologies like YugabyteDB, which provides the capability to handle high-throughput transactions, maintain strong consistency, and support multi-region deployments. My focus is on designing data architecture that integrates distributed databases with cloud-native platforms, ensuring real-time data is accessible and reliable across different locations. Collaborating with engineering teams, I implement rigorous testing under simulated high-traffic conditions and fine-tune systems for optimal performance. Q: Could you elaborate on a specific project where you implemented these solutions? A: One notable project was with a global retailer managing over 300 million products. They needed a scalable system to ensure real-time data access during peak shopping periods and ensure there was no downtime during the deals and product launch days. I led the team and implemented a scalable architecture solution using YugabyteDB, which not only reduced their total cost of ownership by over $10 million but also ensured consistent high-performance operations during critical shopping seasons. This solution provides a seamless end-customer experience during the peak holiday season, which increases customer loyalty and the retailer’s brand recognition. Q: Could you elaborate on a specific project where you implemented these solutions? A: One notable project was with a global retailer managing over 300 million products. They needed a scalable system to ensure real-time data access during peak shopping periods and ensure there was no downtime during the deals and product launch days. I led the team and implemented a scalable architecture solution using YugabyteDB, which not only reduced their total cost of ownership by over $10 million but also ensured consistent high-performance operations during critical shopping seasons. This solution provides a seamless end-customer experience during the peak holiday season, which increases customer loyalty and the retailer’s brand recognition. Q: You also worked with General Motors. What challenges did they face, and how did you help them? A: General Motors’ connected car platform plays a critical role in supporting its new services by collecting and leveraging data from over 20 million connected vehicles. The platform powers features such as vehicle health tracking, remote starts, and road condition reporting through GM mobile apps and OnStar. However, the existing database powering this platform, Apache Cassandra, was becoming a bottleneck. It resulted in high operational costs, limited scalability, and performance issues, especially during peak demand. I worked closely with their technical leadership to redesign the system architecture, which can process vast amounts of telemetry data in real-time, maintain consistency, and scale efficiently. I also led the migration from Apache Cassandra to YugabyteDB. This migration resulted in a tenfold improvement in scalability and performance, enabling the system to handle up to three million writes per second while significantly reducing hardware footprint and operational costs. This transformation allowed GM to enhance its connected vehicle services and deliver a superior customer experience. Q: Can you provide an example of how you helped a financial services customer modernize their data systems? A: A significant case was when I collaborated with senior technical leadership of a large financial services company in migrating from a legacy IBM DB2 mainframe to a modern, scalable system to support a retail portfolio dashboard. By leading the transition to YugabyteDB, I established a resilient architecture that not only reduced the total cost of ownership but also improved the end customer experience. The successful migration allowed live user onboarding, creating a flexible and reliable system supporting future growth. This enabled the company to meet its primary goals of migrating away from the mainframe and leveraging cloud-native databases, which can be deployed on cloud and hybrid commodity architectures. It also helped with improved productivity—rather than being slowed down by waiting for provisioning and maintenance of DB2 on the mainframe, the application team can quickly deploy YugabyteDB anywhere, and it automatically scales as needed. Q: Your achievements in this field are impressive. What drives you to continue pushing boundaries? A: I’m motivated by the impact that scalable data platform solutions can have on mission-critical applications that power businesses and society. Leading high-profile projects on behalf of YugabyteDB, like designing a scalable platform for the Super Bowl 2024 streaming event, has been incredibly rewarding. The ability to deliver a high-quality streaming experience to over 125 million viewers underscores the importance of scalable, resilient systems in today’s interconnected world. Q: What is your vision for the future of data management? A: I believe the ingenuity of technical solutions engineers like myself is crucial for a better-connected world. As industries evolve and the demand for real-time data continues to surge, developing innovative solutions that enable organizations to scale effectively is essential. I aim to lead this charge, ensuring businesses can meet their data challenges head-on and drive success through intelligent data management strategies. Amey Banarse’s ability to architect scalable, resilient systems has allowed these businesses to modernize and handle real-time data at unprecedented scales. His expertise in distributed database technologies is shaping the future of data management and paving the way for organizations to thrive in an increasingly data-driven landscape. As the world becomes increasingly digital, businesses across industries—from retail to finance and automotive—must handle massive volumes of data. Whether managing product catalogs, processing telemetry data, or handling financial transactions, the ability to manage and scale real-time data across multiple regions is critical for global operations. One expert leading the way in solving these data management challenges is Amey Banarse, a solutions engineer with over a decade of experience in distributed database technologies. Amey uses his expertise to solve complex data challenges, reduce costs, and improve performance. His work has led to successful collaborations with Fortune 500 enterprises, including global financial institutions like Wells Fargo and Fiserv, large retailers like Kroger, and automotive companies including General Motors, making him a prominent figure in the field. The Challenges of Data Management in the Digital Age The Challenges of Data Management in the Digital Age Coordinating large amounts of information presents a unique challenge in the modern world. Technological breakthroughs like real-time analytics and machine learning have provided immense benefits, but these advancements also introduce new obstacles, such as the need for low-latency access and maintaining consistent data availability across regions. Amey Banarse shares his insights into overcoming these challenges and the journey that led him to become an expert in the field. Q: Amey, what inspired you to pursue a career in technical solutions engineering? Q: Amey, what inspired you to pursue a career in technical solutions engineering? A : My journey began with a Master’s degree from the University of Pennsylvania in 2010. I started my career as a Senior Data Analytics Consultant at Gemini Systems, New York, where I focused on data analytics platforms in the financial services sector. Collaborating with high-profile clients like the New York Stock Exchange (NYSE) to develop solutions and working on high-impact projects sparked my passion for data management. It was during my collaboration with the Financial Industry Regulatory Authority (FINRA) that I truly recognized the critical importance of robust data architecture. Today, as a recognized thought leader in the data industry, I combine deep expertise in distributed systems and cloud-native transactional applications with a commitment to advancing enterprise data innovation. I am honored to contribute to the leading forums like Forbes Technology Council sharing insights through writing, presentations, and thought leadership. My speaking engagements at premier conferences like AWS ReInvent, VMWare Explore, and SpringOne reflect my dedication to shaping industry discourse, from modern data architectures to enterprise data strategies, helping organizations unlock the full potential of their data assets. A Q: As industries face the increasing demand for real-time data processing, what challenges are they encountering? Q: As industries face the increasing demand for real-time data processing, what challenges are they encountering? A : Today’s businesses, especially in sectors and developing industries like retail, automotive and finance, must manage massive volumes of real-time data while ensuring security and scalability. Challenges include handling traffic surges during peak periods, maintaining data integrity across geographically distributed systems, and providing consistent performance. Failure to address these issues can lead to bottlenecks, data inconsistencies, and operational inefficiencies that significantly impact customer experience and revenue. A Q: Can you share your approach to solving these challenges using distributed database technologies? Q: Can you share your approach to solving these challenges using distributed database technologies? A : Absolutely. I leverage technologies like YugabyteDB , which provides the capability to handle high-throughput transactions, maintain strong consistency, and support multi-region deployments. My focus is on designing data architecture that integrates distributed databases with cloud-native platforms, ensuring real-time data is accessible and reliable across different locations. Collaborating with engineering teams, I implement rigorous testing under simulated high-traffic conditions and fine-tune systems for optimal performance. A YugabyteDB YugabyteDB Q: Could you elaborate on a specific project where you implemented these solutions? Q: Could you elaborate on a specific project where you implemented these solutions? A : One notable project was with a global retailer managing over 300 million products. They needed a scalable system to ensure real-time data access during peak shopping periods and ensure there was no downtime during the deals and product launch days. I led the team and implemented a scalable architecture solution using YugabyteDB, which not only reduced their total cost of ownership by over $10 million but also ensured consistent high-performance operations during critical shopping seasons. This solution provides a seamless end-customer experience during the peak holiday season, which increases customer loyalty and the retailer’s brand recognition. A Q: Could you elaborate on a specific project where you implemented these solutions? Q: Could you elaborate on a specific project where you implemented these solutions? A : One notable project was with a global retailer managing over 300 million products. They needed a scalable system to ensure real-time data access during peak shopping periods and ensure there was no downtime during the deals and product launch days. I led the team and implemented a scalable architecture solution using YugabyteDB, which not only reduced their total cost of ownership by over $10 million but also ensured consistent high-performance operations during critical shopping seasons. This solution provides a seamless end-customer experience during the peak holiday season, which increases customer loyalty and the retailer’s brand recognition. A Q: You also worked with General Motors. What challenges did they face, and how did you help them? Q: You also worked with General Motors. What challenges did they face, and how did you help them? A: General Motors’ connected car platform plays a critical role in supporting its new services by collecting and leveraging data from over 20 million connected vehicles . The platform powers features such as vehicle health tracking, remote starts, and road condition reporting through GM mobile apps and OnStar. However, the existing database powering this platform, Apache Cassandra, was becoming a bottleneck. It resulted in high operational costs, limited scalability, and performance issues, especially during peak demand. I worked closely with their technical leadership to redesign the system architecture, which can process vast amounts of telemetry data in real-time, maintain consistency, and scale efficiently. I also led the migration from Apache Cassandra to YugabyteDB. This migration resulted in a tenfold improvement in scalability and performance, enabling the system to handle up to three million writes per second while significantly reducing hardware footprint and operational costs. This transformation allowed GM to enhance its connected vehicle services and deliver a superior customer experience. A: 20 million connected vehicles 20 million connected vehicles Q: Can you provide an example of how you helped a financial services customer modernize their data systems? Q: Can you provide an example of how you helped a financial services customer modernize their data systems? A : A significant case was when I collaborated with senior technical leadership of a large financial services company in migrating from a legacy IBM DB2 mainframe to a modern, scalable system to support a retail portfolio dashboard. By leading the transition to YugabyteDB, I established a resilient architecture that not only reduced the total cost of ownership but also improved the end customer experience. The successful migration allowed live user onboarding, creating a flexible and reliable system supporting future growth. This enabled the company to meet its primary goals of migrating away from the mainframe and leveraging cloud-native databases, which can be deployed on cloud and hybrid commodity architectures. It also helped with improved productivity—rather than being slowed down by waiting for provisioning and maintenance of DB2 on the mainframe, the application team can quickly deploy YugabyteDB anywhere, and it automatically scales as needed. A Q: Your achievements in this field are impressive. What drives you to continue pushing boundaries? Q: Your achievements in this field are impressive. What drives you to continue pushing boundaries? A : I’m motivated by the impact that scalable data platform solutions can have on mission-critical applications that power businesses and society. Leading high-profile projects on behalf of YugabyteDB, like designing a scalable platform for the Super Bowl 2024 streaming event, has been incredibly rewarding. The ability to deliver a high-quality streaming experience to over 125 million viewers underscores the importance of scalable, resilient systems in today’s interconnected world. A Q: What is your vision for the future of data management? Q: What is your vision for the future of data management? A : I believe the ingenuity of technical solutions engineers like myself is crucial for a better-connected world. As industries evolve and the demand for real-time data continues to surge, developing innovative solutions that enable organizations to scale effectively is essential. I aim to lead this charge, ensuring businesses can meet their data challenges head-on and drive success through intelligent data management strategies. A Amey Banarse’s ability to architect scalable, resilient systems has allowed these businesses to modernize and handle real-time data at unprecedented scales. His expertise in distributed database technologies is shaping the future of data management and paving the way for organizations to thrive in an increasingly data-driven landscape.

How Distributed Databases Power Mission-Critical Business Apps: A Case Study with Amey Banarse

Hoe verspreide databasisse missie-kritiese besigheidsprogramme bemagtig: 'n gevallestudie met Amey Banarse

Hvordan distribuerede databaser driver Mission-Critical Business Apps: A Case Study med Amey Banarse

Cómo las bases de datos distribuidas potencian las aplicaciones empresariales de misión crítica: un estudio de caso con Amey Banarse

分散データベースがミッションクリティカルなビジネスアプリを強化する方法: Amey Banarse のケーススタディ

Како се дистрибуирани базите на податоци моќни мисија-критични деловни апликации: студија на случај со Ејми Банарсе

Bagaimana Pangkalan Data Teragih Menguasakan Aplikasi Perniagaan Misi-Kritis: Kajian Kes dengan Amey Banarse

Jak rozproszone bazy danych zasilają aplikacje biznesowe o znaczeniu krytycznym: studium przypadku z Amey Banarse

Как распределенные базы данных поддерживают критически важные бизнес-приложения: пример с Эми Банарсе

Mafambisirwo Akaitwa Databases Power Mission-Critical Business Apps: Nyaya Yekudzidza naAmey Banarse

எப்படி விநியோகிக்கப்படும் தரவுத்தளங்கள் பவர் மிஷன்-கிரிட்டிகல் பிசினஸ் ஆப்ஸ்: அமே பனார்ஸுடன் ஒரு வழக்கு ஆய்வு

Чӣ гуна пойгоҳи додаҳои тақсимшуда Барномаҳои миссияи муҳими тиҷоратӣ: Омӯзиши мисол бо Ами Банарсе

ከመይ ጌሮም ዝተዘርግሑ ዳታቤዛት ንተልእኾ-ወሳኒ ንግዳዊ ኣፕስ ሓይሊ ይህቡ: መጽናዕቲ ፍጻመ ምስ ኣመይ ባናርሰ

Authors:
(1) Mark Bergen, Carlson School of Management, University of Minnesota;
(2) Thomas Bergen, Carlson School of Management, University of Minnesota;
(3) Daniel Levy, Department of Economics, Bar-Ilan University, Department of Economics, Emory University, and ISET at Tbilisi State University, 0108 Tbilisi, Georgia;
(4) Rose Semenov, Carlson School of Management, University of Minnesota. Table of Links Abstract

Reduce the company’s costs of changing prices (“menu cost”)
Reduce customers’ “stress of uncertainty”
Reduce societal fears of “shrinkflation, greedflation, and doubtflation"



References 1. Reduce the company’s costs of changing prices (“menu cost”) Our research shows the costs of changing prices (known is “menu cost”) can be far greater than managers recognize, especially during high inflationary environments. We documented the average costs of changing prices per store at four major US grocery chains using in-depth studies of their weekly price change processes (Levy, Bergen, Dutta, and Venable, 1997), analyzing workflow schematics, and undertaking detailed instore time and motion measurements of each process step across multiple stores at each chain (Levy, Dutta, Bergen, and Venable, 1998). The costs include the labor cost to change shelf prices, the cost of printing and delivering new price tags, the costs of mistakes made during the price change process, and the cost of in-store supervision of the price change process. Applying these costs to the largest US grocery chain, Kroger, would yield an annual cost of $291.9 million in total across 2,757 of their stores. Now, imagine a hyperinflationary scenario like Zimbabwe in 2008 where prices doubled every day. These price change processes would be undertaken seven times a week, rather than once a week. This would cause the total annual cost of price adjustment to balloon to $2.04 billion a year. Successfully dealing with high inflation requires managing pricing processes to reduce the costs of price adjustment. This often involves using simplified pricing rules or adopting new pricing technologies. For example, Israeli booksellers went from pricing individually to pricing groups of books by assigning letter codes (A, B, C, …, etc.) and posting a price list. In Brazil, retailers digitized price adjustments with electronic shelf labels, which eliminated the labor costs required to manually update prices across hundreds of products now being re-priced multiple times (rather than once) per week. The costs of hyperinflation can also be curtailed by grounding prices in more stable currencies. During Israeli runaway inflation, quoting prices in dollars was frequent for durable goods and housing—even at amounts greater than citizens were legally allowed to hold. In Venezuela during the current hyperinflation, sellers are adopting peer-to-peer cryptocurrency payments, allowing street vendors to price with digital coins. By simplifying processes, investing in technology, and presenting price stability, organizations can reduce the costs of changing prices to navigate inflationary pressures. This paper is available on arxiv under CC BY 4.0 DEED license. Authors: (1) Mark Bergen, Carlson School of Management, University of Minnesota; (2) Thomas Bergen, Carlson School of Management, University of Minnesota; (3) Daniel Levy, Department of Economics, Bar-Ilan University, Department of Economics, Emory University, and ISET at Tbilisi State University, 0108 Tbilisi, Georgia; (4) Rose Semenov, Carlson School of Management, University of Minnesota. Authors: Authors: (1) Mark Bergen, Carlson School of Management, University of Minnesota; (2) Thomas Bergen, Carlson School of Management, University of Minnesota; (3) Daniel Levy, Department of Economics, Bar-Ilan University, Department of Economics, Emory University, and ISET at Tbilisi State University, 0108 Tbilisi, Georgia; (4) Rose Semenov, Carlson School of Management, University of Minnesota. Table of Links Abstract

Reduce the company’s costs of changing prices (“menu cost”)
Reduce customers’ “stress of uncertainty”
Reduce societal fears of “shrinkflation, greedflation, and doubtflation" References Abstract Reduce the company’s costs of changing prices (“menu cost”)
Reduce customers’ “stress of uncertainty”
Reduce societal fears of “shrinkflation, greedflation, and doubtflation" Abstract Abstract Reduce the company’s costs of changing prices (“menu cost”) Reduce customers’ “stress of uncertainty” Reduce societal fears of “shrinkflation, greedflation, and doubtflation" Reduce the company’s costs of changing prices (“menu cost”) Reduce the company’s costs of changing prices (“menu cost”) Reduce customers’ “stress of uncertainty” Reduce customers’ “stress of uncertainty” Reduce societal fears of “shrinkflation, greedflation, and doubtflation" Reduce societal fears of “shrinkflation, greedflation, and doubtflation" References References References 1. Reduce the company’s costs of changing prices (“menu cost”) Our research shows the costs of changing prices (known is “menu cost”) can be far greater than managers recognize, especially during high inflationary environments. We documented the average costs of changing prices per store at four major US grocery chains using in-depth studies of their weekly price change processes (Levy, Bergen, Dutta, and Venable, 1997), analyzing workflow schematics, and undertaking detailed instore time and motion measurements of each process step across multiple stores at each chain (Levy, Dutta, Bergen, and Venable, 1998). The costs include the labor cost to change shelf prices, the cost of printing and delivering new price tags, the costs of mistakes made during the price change process, and the cost of in-store supervision of the price change process. Applying these costs to the largest US grocery chain, Kroger, would yield an annual cost of $291.9 million in total across 2,757 of their stores. Now, imagine a hyperinflationary scenario like Zimbabwe in 2008 where prices doubled every day. These price change processes would be undertaken seven times a week, rather than once a week. This would cause the total annual cost of price adjustment to balloon to $2.04 billion a year. Successfully dealing with high inflation requires managing pricing processes to reduce the costs of price adjustment. This often involves using simplified pricing rules or adopting new pricing technologies. For example, Israeli booksellers went from pricing individually to pricing groups of books by assigning letter codes (A, B, C, …, etc.) and posting a price list. In Brazil, retailers digitized price adjustments with electronic shelf labels, which eliminated the labor costs required to manually update prices across hundreds of products now being re-priced multiple times (rather than once) per week. The costs of hyperinflation can also be curtailed by grounding prices in more stable currencies. During Israeli runaway inflation, quoting prices in dollars was frequent for durable goods and housing—even at amounts greater than citizens were legally allowed to hold. In Venezuela during the current hyperinflation, sellers are adopting peer-to-peer cryptocurrency payments, allowing street vendors to price with digital coins. By simplifying processes, investing in technology, and presenting price stability, organizations can reduce the costs of changing prices to navigate inflationary pressures. This paper is available on arxiv under CC BY 4.0 DEED license. This paper is available on arxiv under CC BY 4.0 DEED license. available on arxiv

3 Lessons From Hyperinflationary Periods: Reduce the Company’s Costs of Changing Prices

The company's journey to IPO is impressive, but the long-term upside hinges on the success of its long-term bets like ads and the enterprise platform. Last week, Instacart filed an S-1 with the Securities and Exchange Commission (SEC) in preparation for their IPO. This is an incredible moment for the company that pioneered the online grocery delivery market. Huge congratulations to the team on this milestone — it’s an impressive outcome from an 11-year journey. This, along with the Klavio and ARM IPOs, has created fresh hope that the tech IPO market is en route to recovery. Interestingly, when a company announces it intends to go public, the law requires it to open up a firehose of information. One such document is . From analyzing this document, a couple of things stand out: Instacart’s 300+ page S-1 filing In 2022, the US grocery market was $1.1 trillion, of which ~$132B is online; of this, ~$29B ran through Instacart. In other words, , pointing to a market saturation risk. Instacart already has 22% of the current total addressable market (TAM) for online grocery The company lists out a long list of potential risks (which is required and therefore expected on an S-1), and — intense competition, heavy reliance on medium-size retailers who might be consolidating/getting bigger, profitability risks to name a few, etc. many of these risks seem non-trivial While Instacart has navigated rough valuation corrections and managed to have a profitable 2022, the company still has several challenges ahead as it starts operating as a public company. In this article, we’ll talk about the company is making to set itself up for success. where the US grocery market is, Instacart’s market saturation problem, and the long (but uncertain) bets US Grocery Market and Instacart’s Market Saturation Problem To understand Instacart’s market saturation problem, let’s start with understanding the US grocery market from a couple of different lenses. One lens is looking at the overall market and what percent of it is/will be online. The total US grocery market as of 2022 is $1.1 trillion. Of this, ). ~12% is online (i.e., ~$132B Of the $132B online grocery market, Instacart ran worth of transactions in 2022, i.e., . $29B they already have ~22% of the online grocery market Also note that the total US grocery is expected to grow modestly at , which is not surprising for a mature market. While the % of this market that moves online changes meaningfully, it is estimated to cap out at ~21–24% in the next 5–10 years. ~2.3% annually As an example, per Instacart’s own reporting (chart below), in 2027, the online grocery market will be $1.3B * 21% online = ~$273B (about double what it is today). Another lens to look at the market is share by retailer. About half of the market is owned by (Walmart, Costco, Kroger, Sam’s Club), about one-fourth by (Publix, Target, Albertsons/Safeway, H-E-B, Whole Foods), and the remaining one-fourth by small local stores (convenience stores, local grocery stores, specialty grocery stores, etc.). large retailers medium retailers In other words, large retailers hold a lot of sway, followed by medium retailers. Put these two lenses together, and you start seeing the key challenges Instacart is facing. First, the overall grocery market is not growing by that much, and Instacart is facing intense competition. While Instacart wants to and not redistribute existing value, this is much harder to do in a mature market like US grocery. “grow the pie” For Instacart to succeed, the company needs to of the highly competitive online grocery market . preserve/expand its share AND increase the percentage of grocery delivery that happens online Second, Instacart needs to make itself . Large retailers (half of the grocery market) have either already invested or are starting to invest in their own technology offerings. valuable enough that large and medium retailers stick around Grocery is also a high volume, low margin business, which has resulted in more consolidation lately ( ). Kroger and Albertsons/Safeway announced they are merging As more of the medium retailers beef up to become larger, Instacart runs the risk of losing them if they choose to in-house their technology and logistics investments. For Instacart to be successful long-term, it’s critical for them to solve these two big challenges, and the company is making long-term bets in that direction. Instacart’s Long (but Uncertain) Game It’s clear from the S-1 that Instacart understands these challenges and is willing to make long-term investments. We’ll look at a few of these investments, and what the outlook looks like for each. Building Customer Loyalty to Defend Its Market Customers often don’t have loyalty toward delivery platforms and tend to switch freely to the cheapest option. While Instacart has built features that make the user experience more delightful (e.g., showing you items you have ordered before), competitors have followed suit. Instacart acknowledges : this risk As the effects of the COVID-19 pandemic and its variants subside, including the cessation of government stimulus, it is increasingly important to our business and its ability to grow for consumers to perceive long-term value from Instacart versus in-store shopping or less costly alternatives, particularly for lower income consumers. They are making investments to build loyalty — both through cheaper prices derived from operational efficiencies, and an . unlimited free delivery subscription Instacart+ Though Instacart+ has an impressive 5M members and accounts for , several competitors have equivalent products that do not require explicit payments. ~57% of transaction volume For example, DoorDash’s DashPass is offered for free with , and bundles free grocery delivery along with free eCommerce shipping. some Chase credit cards Walmart+ Instacart also has a similar deal today, pointing to a likely future where several subscriptions are provided to consumers for free, thereby eroding Instacart’s advantage from Instacart+. with Chase credit cards Take it with a grain of salt since it’s one person’s experience, but the last time I ordered groceries online, I compared prices on DoorDash and Instacart (because both are more expensive than in-store). I had free subscriptions for both through credit cards. The final amount turned out to be about the same, and I ended up ordering with DoorDash — because I use the app more often for ordering from restaurants. This points to another disadvantage Instacart has over more high-frequency/ubiquitous competitors. Overall, I still think Instacart will continue to be a significant player and at least defend the % of the online grocery market they own, but I’m not bullish that this % will increase. Scaling Up Advertising for New Revenue + Subsidizing Delivery Instacart ads generated $740M in 2022 revenue. Besides creating a new revenue stream (which Instacart definitely needs given its market saturation), this descriptive chart from Instacart’s S-1 perfectly captures why advertising matters for the company: For every transaction, Instacart collects fees from retailers and from consumers. It then pays out shoppers who pick up/deliver groceries; in this part of the funnel, from a $110 transaction, Instacart gets to keep $7. There is further “cost of revenue” including but not limited to technology/infrastructure, employee salaries, etc.; of the $7, Instacart gets to keep $4 “gross profit”, i.e., a low 4% profit margin. Now, add advertising to this. What Instacart keeps goes up to $7 “gross profit”, i.e., . In other words, it increases the company’s bottom line by 50%. advertising turns Instacart from a 4% to a 6% margin business This is a very similar strategy to how . Uber successfully used ads to subsidize their low-margin delivery & rides business While the ads revenue number is impressive, what makes this product strategically valuable is what ads in the context of Instacart can drive for advertisers. Let’s look at Uber briefly, and then come back to Instacart. In the Uber analysis, I wrote about the UberEats and Uber Rides app inventory — UberEats is high intent and in context (e.g., you are searching for restaurants and you see a restaurant ad) vs. Uber Rides which is more display ads-y (e.g., you ordered a ride, there’s a free canvas there, and Uber shows you an ad for something that could be relevant to you but not contextual). differences between Between the two, I was significantly more bullish on UberEats because the value proposition to an advertiser is clear — spend ads money with Uber and directly measure the transactions it drives (the link is much less defensible for Uber Rides app ads). For the same reason, I’m very bullish about Instacart ads. Specifically, Instacart is building their ads product for — classic examples of CPG advertisers are Procter and Gamble (makes Tide pods), Coca-Cola, Kellogg’s, AbInBev (makes Bud Light) to name a few. consumer packaged goods (CPG) advertisers Though CPG advertisers have some of the most sophisticated marketers in the industry, they have often struggled with measuring the direct effectiveness of their ads. For example, if you are Procter & Gamble and you want to increase sales of Tide pods, you don’t go run ads on Google, Facebook, or display. Because users don’t buy directly from Procter & Gamble, they buy from distributors/retailers like Walmart and Target. Therefore, CPG advertisers typically have to use more traditional marketing methods, like paying Walmart to show their products prominently in aisles. Another version of this is where a CPG brand spends ad dollars on behalf of some distributors, e.g., AbInBev spends ad dollars promoting Bud Light sales in a few specific bars. co-op advertising dollars While several top retailers have built sophisticated ad products for CPG advertisers (a new category of ad platforms called ), — if you are a CPG brand and you don’t sell directly to consumers, you need to rely on some sort of “estimated” measurement of how effectively your ads dollars are driving sales. retail media networks the two-hop problem still exists Their ad product , e.g., Procter & Gamble can specifically promote Tide pods when you are in the process of ordering from a Safeway near you. Instacart breaks that huge limitation. lets CPG advertisers promote specific items at specific retailers in a highly contextual format And more importantly, since the actual transaction happens within the Instacart app, Instacart can deterministically (without any “estimations”) say how much product sales were driven by ad spend. Irrespective of how mature or effective the Instacart ad product is today, the that very few other products have. ability to provide direct response advertising to CPG advertisers and measure sales outcomes with high confidence is a big moat There are a couple of advertising-related risks though. Instacart’s order numbers are flat year over year, and if this were to decline, that would hurt their ability to scale the ads products (sub-scale advertising products have a difficult time succeeding — e.g., Twitter). Also, with Instacart’s ad product, the company risks pissing off retailers who are essentially building their own ad products. Advertising often tends to be a zero-sum game, and if Procter and Gamble is spending directly with Instacart, that’s money not being spent on Safeway’s retail media network. Instacart could make the argument that it “grows the pie” for everyone, but I’m not confident this would land with retailers. My guess is that it will land in a place where Instacart agrees to some revenue share model with retailers. Overall, I’m bullish that the ads business will continue to thrive as long as it can keep up order volume. Instacart Enterprise Platform At the beginning of the S-1, Instacart CEO Fidji Simo articulates Instacart’s vision: Our vision is to build the technology that powers every single grocery transaction — working with the retailers that consumers know and love to invent the future of grocery together. And right now, that’s more important than ever. Note the language there — Instacart does not say that they want to be the primary platform for every grocery transaction. They say they want to build the technology that powers it. I have no criticism of the framing, and I think that’s a smart strategy, but I do think that the framing is a direct consequence of the market saturation problem Instacart is facing. Instacart knows that more online grocery orders cannot be their only future (or at least that there’s a ceiling on the addressable market with that approach). A few excerpts from the S-1 support this and also shine a light on how Instacart is thinking about going beyond online grocery: We (Instacart) believe the future of grocery won’t be about choosing between shopping online and in-store. Most of us are going to do both. So we want to create a truly omni-channel experience that brings the best of the online shopping experience to physical stores, and vice versa. With the business of grocery changing so quickly, many retailers need a trusted partner to help them navigate this digital transformation so that they can drive success both online and in-store. If the neighborhood grocer who has been serving their community for decades can’t find an edge, they may not be able to keep up. They are looking to address this opportunity with the — it’s essentially a Shopify-esqe offering but specifically for brick-and-mortar retailers, and supports a range of functionality across retailers’ life cycles. Some notable functionality includes: Instacart enterprise platform eCommerce: They provide white-label online storefronts for 550 brands (see screenshot of Sprouts’ storefront powered by Instacart). Fulfillment: actual delivery of orders; typically picked, packed, and delivered by Instacart shoppers, but retailers can also choose to pick and pack themselves. Ads: Power on retailers’ eCommerce storefronts sponsored products and display ads With this investment, Instacart is and , and with them long term (and not consider in-housing all of their online business). betting that they can use their existing position as retailers’ delivery partners expand that to be more strategic technology partners consequently get retailers to stick around It is a smart bet, but I think is nowhere close to a slam dunk (at least so far). Large retailers (Walmart, Kroger, etc.) control ~50% of the grocery market, and I’m skeptical that they would want to rely on Instacart’s enterprise platform as their storefront. Large companies like to minimize external dependencies because these tend to slow down product development heavily in the long term. Additionally, if I were running online grocery at Kroger, I would not want a distribution partner to also be my technology provider — because sooner or later, the partner is going to have a conflict of interest, and that won’t be a fun conversation to have. Even if I had no technical competency in-house, I would much rather hire from a long list of system integrators, or contract the work to an IT company (like Infosys, Wipro) to build an in-house system. Outsourcing tech for online grocery is likely more palatable for medium-sized retailers who are okay with strategic risk, but there have been indications that consolidation is coming (e.g., Kroger Albertsons merger), and it’s uncertain how many medium-sized retailed will continue to exist in the long term. Not to say this bet won’t be successful — just that these are non-trivial challenges that Instacart needs to address to actually make the transition to being a dual distribution + technology partner for medium and large retailers. Conclusion I think Instacart’s journey so far is nothing short of impressive, and they have clearly created a market that’s here to stay. Despite all the non-trivial challenges, I am bullish that Instacart will come out of this successful. Their ads business that caters to CPG advertisers’ direct response needs is a strong moat that can subsidize the delivery business. This, along with other operational improvements they are making, can improve their profitability and therefore at least maintain their market share of the online market (I’m skeptical about it expanding). The key uncertainty to me is if they can make the transition to a dual distribution + technology partner role for retailers, and that might meaningfully change the trajectory of what Instacart’s long-term valuation ends up being. 🚀 If you liked this piece, consider subscribing to Every week, I publish one in the form of a 10-minute read. . my weekly newsletter deep-dive analysis on a current tech topic/product strategy Best, Viggy. Also published more

Instacart IPO: Will It Win The Race Against Market Saturation?

ইন্সটাকার্ট আইপিও: এটা কি বাজার স্যাচুরেশনের বিরুদ্ধে রেস জিতবে?

Börsengang von Instacart: Wird es den Wettlauf gegen die Marktsättigung gewinnen?

IPO de Instacart: ¿Ganará la carrera contra la saturación del mercado?

Introduction en bourse d'Instacart : gagnera-t-il la course contre la saturation du marché ?

इंस्टाकार्ट आईपीओ: क्या यह बाजार संतृप्ति के खिलाफ दौड़ जीतेगा?

Instacart IPO: 市場飽和との競争に勝つことができるか?

Instacart IPO: 시장 포화에 맞서는 경쟁에서 승리할 수 있을까요?

IPO da Instacart: ela vencerá a corrida contra a saturação do mercado?

IPO Instacart: выиграет ли компания в борьбе с насыщением рынка?

Instacart Halka Arz: Piyasa Doygunluğuna Karşı Yarışı Kazanacak mı?

IPO Instacart: Liệu nó có giành chiến thắng trong cuộc đua chống bão hòa thị trường?

Instacart IPO：它会赢得对抗市场饱和的竞赛吗？

Even Supermarkets Are Tracking Your Data Nowadays

এমনকি সুপারমার্কেটগুলি আজকাল আপনার ডেটা ট্র্যাক করছে

Sogar Supermärkte verfolgen heutzutage Ihre Daten

Incluso los supermercados están rastreando sus datos hoy en día

Même les supermarchés suivent vos données de nos jours

आजकल सुपरमार्केट भी आपके डेटा को ट्रैक कर रहे हैं

最近ではスーパーマーケットでさえあなたのデータを追跡しています

요즘에는 슈퍼마켓에서도 데이터를 추적하고 있습니다.

Até os supermercados estão rastreando seus dados hoje em dia

Günümüzde Süpermarketler Bile Verilerinizi Takip Ediyor

Ngay cả các siêu thị cũng đang theo dõi dữ liệu của bạn ngày nay

如今，甚至超市也在跟踪您的数据

The last month will go down in history as "black February" and not so much because of volatility in the markets as growing geopolitical tensions. Despite all the promises, Russian President Vladimir Putin gave the green light to a so-called "military operation" in Ukraine. It didn’t take long for Europe and the US to respond. In a matter of days, the Office of Foreign Assets Control of the US Department of the prohibited United States persons from engaging in transactions with the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation. Treasury This action effectively immobilizes any assets of the Central Bank of the Russian Federation held in the United States or by U.S. persons, wherever located. On top of that, the United States and its allies have announced that they are prepared to restrict imports of Russian technology products by 50%. Lose-lose situation The only problem is that anti-Russian sanctions have also punished the global economy: gas and oil prices are skyrocketing, whereas prices for metals, including palladium, which is widely used in the manufacture of automotive catalysts, have hit multi-year highs. In this context, it shouldn’t be a surprise that inflation expectations have spiked once again. According to the latest , Eurozone consumer prices rose by a record 5.8 percent in February. data The jump in the cost of living in the Eurozone to well above the ECB’s 2 percent inflation target has divided the central bank into two groups: those who are pushing for tighter monetary policy to tackle inflation and those who want a pause to assess the economic impact of Russia’s invasion of Ukraine. Prepare for High Gas Prices Regarding energy prices, the biggest issue is that the world's leading oil powers simply cannot increase production due to lack of capacity because of extremely low investment in the industry in recent years. Even the current quotas are not fully taken by OPEC+ countries. The good news is that the prospects for the Iran nuclear deal remain important for the oil market. Negotiators are gradually moving closer to a consensus, which could mean the removal of sanctions on Iranian oil exports and would add up to 1 million barrels to the market by 2022. Iran currently produces about 2.5 million b/d. It is forecasted that the rapid growth of commodity prices could end up pushing up inflation in the U.S. and EU. The monetary authorities will inevitably react to this by raising refinancing rates, which will raise the cost of loans for businesses. Given the rise in the cost of industrial raw materials, along with energy, this will inevitably lead to a downturn in the global economy. In particular, JPMorgan Chase & Co. a run-up to $150 a barrel would almost stall the global expansion and send inflation spiraling to over 7%, more than three times the rate targeted by most monetary policymakers. warns How to Save Money Despite rising inflation expectations, the major cryptocurrency failed to justify its safe-haven status. Possible reasons for the continuation of the sideways trend include geopolitical tensions, as well as increased hawkish sentiment at the Federal Reserve. If risk-off in the markets continues, Bitcoin's return to historical records may be delayed. In the meantime, Exchange-traded funds that in gold and other precious metals have seen massive inflows. Data from Refinitiv Lipper showed and other precious metal ETFs have seen an inflow of $4.7 billion this year, after witnessing outflows worth $7.8 billion last year. invest gold Regarding the stocks, the best idea would be to follow Buffett’s principle: not to rush and invest in enterprises with a long-term economic outlook. It is worth mentioning that in the last quarter, Berkshire Hathaway shares of Teva Pharmaceuticals (TEVA) and Sirius XM Holdings (SIRI), and bought securities of Formula One Group (FWONK), Activision Blizzard (ATVI), and Nu Holdings (NU). sold In addition, Berkshire increased its stake in Chevron (CVX) by more than 33%, decreasing its stake in Kroger (KR) by 0.61%, and Charter Communications, Inc. (CHTR) by 8.8%. Also, the company continued to get rid of pharma securities, with shares in AbbVie ( ) down -79%, Bristol Myers Squibb (BMY) down -76%, and Royalty Pharma (RPRX) down 34%. ABBV Another option would be to invest in real physical assets: real estate, cars, or bars of gold or other metals. In addition, it could be a good idea to focus on businesses that don't depend too much on market conditions and external circumstances. Everything that generates cash is a possible defense against inflation.

Dear Global Economy, Winter is Coming

Have you ever heard the phrase, “people don’t buy products; they buy feelings”? The future of business is all about giving customers what they want – not just a product or service, but a feeling that they are doing something good for the world. More and more, consumers are in search of businesses that can demonstrate their social responsibility. And let's face it – the state of the world in 2022 certainly calls for a little TLC from the business community. The environment is suffering, the economy is struggling, and social inequality is on the rise. It's not all doom and gloom, however; in fact, there are some businesses already beginning to make headway in the social responsibility arena. I interviewed the CEO and founder of one such business on how to get started as a socially responsible organization. Paul Shapiro of The Better Meat Co. In one of my most recent episodes of the Success Story Podcast, I had the privilege of speaking with Paul Shapiro, co-founder and CEO of The Better Meat Co. Here's a brief bio on Paul: He’s the author of the national bestseller Clean Meat: How Growing Meat Without Animals Will Revolutionize Dinner and the World. He is CEO of The Better Meat Co., a socially responsible and cruelty-free animal-free meat company. He’s a four-time TEDx speaker, and host of the Business for Good Podcast. And if that wasn’t enough, he has published articles in the Washington Post, Scientific American, FORTUNE, and more. Paul grew up with a love of animals, and he was always confronted by the ethical dilemma of meat consumption. After twenty years of working in the nonprofit space as a lobbyist and advocate for animals, he became increasingly interested in the role that food technology could play in helping to solve some of the world's most pressing problems, like climate change and global hunger. This is what (eventually) led him to start The Better Meat Co., a company that creates delicious, healthy, and humane meat alternatives that are better for both people and the planet. Note: There's a lot more to his story than this brief overview, so if you're interested in hearing more about Paul, I'd highly recommend listening to his Success Story Podcast episode here: Why do we need socially responsible businesses in 2022? Paul’s company, The Better Meat Co., is an excellent example of a business that is both socially and environmentally responsible. Using the power of fermentation and harnessing the nutrients offered by mycoprotein, The Better Meat Co. is able to create a healthy, sustainable, and ethical product that actually tastes like meat. In doing so, Paul's mission is to lighten the burden that animal agriculture places on the environment, while also helping to improve the treatment of animals. With an increase in awareness of the detrimental issues our planet is facing, it’s never been more important for businesses to consider their social responsibility. Paul gave a compelling reason as to why 2022 is the year for businesses to step up and become more socially responsible. "Think about the fact that there's nearly 8 billion of us walking around on the planet today, and we're going to have another 2 billion added to the planet [in the next 30 years]. We're not going to be farming the moon, we're not going to be farming Mars; we have one planet to farm, right? That's Earth, and it's not getting any bigger." Earth is finite, and as such, we are all responsible for looking after its resources. But businesses don’t have to focus on animal agriculture, like The Better Meat Co. – there are so many more global issues needing our attention, such as: Climate change and its impact on the environment,Sourcing sustainable materials and products,The ethical treatment of employees,Community engagement and giving back,And the list goes on. Typically, businesses hold more economic and social influence than individuals. By stepping into a more socially responsible role as a business, you can make an enormous impact on issues affecting your local space, and even national or international issues. Social responsibility from a business perspective The concept of corporate social responsibility (CSR) isn't just about doing the right thing. It's also an excellent strategy from a business point of view, which is why the corporate world has begun to see a noticeable shift toward the . Decade of Purpose In the 2000s, business leaders were primarily focused on connection; in the 2010s, convenience; and now in the 2020s, they're focused on how to make a positive impact on society. This is partially due to the emergence of more sustainably-minded people stepping into leadership roles in the past decade – but the same can't be true for all businesses, so why the sudden change? Simply put, purpose-driven businesses are more successful. Take a look at these telling facts and figures: According to Cone Communications and Echo Research, would switch to socially responsible brands, and would decline doing business with an unethical brandNielsen IQ reports that will pay extra for products that contribute to a good cause favor companies that can demonstrate their corporate social responsibility efforts, according to Aflac 90% of shoppers globally 76% of consumers 55% of consumers 61% of investors Not only that, but CSR is becoming almost essential for sourcing and securing top talent.  Millennials in particular are drawn to purpose-driven businesses, and many will turn down a job offer from a company that doesn’t have a social conscience. According to the Cone Communications on Millennial Employment Engagement: 2016 study 64% of millennials take CSR into serious consideration when deciding where to work, and will not take a job unless the company demonstrates strong CSR values83% will be more loyal to their company if it helps them to take on more social responsibility as part of their role (as compared to the 70% U.S. average)88% find their jobs more fulfilling if they are able to contribute to alleviating social and environmental issues Clearly, consumers and employees alike are looking for businesses with heart. So what does it take to start your own socially responsible business? Let’s turn back to Paul Shapiro of The Better Meat Co. for some expert advice on how he began his ethically responsible business. Starting your purpose-driven and socially responsible business When Paul began putting his vision into action, he wasn’t an expert in the field by any means. He’d written books about the concept of technology’s role in sustainable food production, but he was starting a business, not just preaching about the topic. Still, The Better Meat Co. ended up a resounding success – so how did he do it? Let's see what Paul had to say, and what we can observe from his inspirational success. First, start with a vision You can't hope to achieve anything if you don't have a clear idea of what it is you're working for. Paul's vision for The Better Meat Co. was to create meat products that were tasty for people, yet caused no harm to animals, the environment, or society. There was a clear vision and purpose behind the company, and it was communicated effectively to both employees and customers. "I had a decision to make," Paul said in his interview. "I had just written this book, and was going on tour to talk about great entrepreneurs who I thought would end up saving the world. And so I thought, I could continue to simply write about the people who I thought were going to solve this problem, or I could become one of them myself. And I chose the latter path." Clearly, Paul had a vision – and you need one too, if you want to start a socially responsible business. What's your vision? What's the problem you're trying to solve? How can your business make a positive impact on the world? Surround yourself with the right people Although Paul was clearly a go-getter, he didn't have entrepreneurial experience in the beginning of his career as a CEO. However, he found a clever way to remedy this; he surrounded himself with people who had the knowledge he needed. Paul researched other meat alternative companies in order to learn more about fermentation and fungi-based mycoprotein – but the majority of people he surrounded himself with, as it turns out, weren't experts in his field at all. They were motivated individuals who shared his same passion for making change. "If you read [my book] Clean Meat, one of the things you notice is that many of the people who I talk about in the book are not people who are seasoned entrepreneurs, or people who have PhDs. Many of the entrepreneurs are people who just wanted to make a difference." When you're starting your own socially responsible business, follow Paul's lead and find like-minded individuals who share your same values and goals. This will help you to create a supportive community – one that can offer advice, mentorship, and resources when needed. As once famously said, If you want to start a successful, purpose-driven business, then it's important to surround yourself with people who will reaffirm your vision and help you achieve your goals. Jim Rohn "You are the average of the five people you spend the most time with." Read up on case studies and get inspired When you are first starting out on your mission to build a socially responsible business, you're full of energy, ideas, and adrenaline. It can be tempting to barge on ahead without taking the time to do your research and learn from those who have come before you. Remember, though, that you can gain a lot from studying the successes (and failures) of others. In his interview, Paul spoke about a highly successful startup that inspired him at the beginning of his journey: Perfect Day. Perfect Day creates dairy milk without the need for cows, using yeast to ferment sugars from plants. The company's products hit shelves in 2018, and they're already being stocked in major grocery stores like Kroger and Safeway. Looking into other businesses that have found success with a social conscience gave Paul the push he needed to start his own venture. "Those stories about mere mortals who were making this happen were inspirational to me, because I thought, And they have done a phenomenal job running their company, and I hope to have a fraction of the success that they're having." 'hey, if these guys can do it, maybe I can, too'. If you are someone who resists against learning from others, this is likely a difficult concept to grasp. Perhaps you are driven to do everything on your own merit, or you may even harbor competitive feelings toward other businesses with a social conscience. However, it's important to remember that you can learn a lot from those who have gone before you. Soak up their successes, failures, and lessons learned to help make your own journey smoother. Conduct industry research You're feeling inspired, and you've surrounded yourself with like-minded individuals – so where do you go from here? This is where we get into the nuts and bolts of launching your socially responsible business, starting with industry research. Industry research is a little different to market research in that you're looking to answer the following questions: What are the current industry trends?Who are the key players in the industry?What are the major challenges and opportunities facing the industry? Rather than looking at the figures for your specific product or service, you're looking at the trends in the industry as a whole and trying to work out how your business can fit into that. Paul's industry is one that has evolved almost exponentially in the last few years. The Better Meat Co was born out of a realization that the traditional meat industry was broken, and that there was a huge opportunity to create a more sustainable, ethical, and profitable business model. For example: But there was more industry research to be done within that specific niche. "When you go back about five or so years ago, you get companies like Impossible Foods and Beyond Meat who are trying to make products for diehard carnivores; something that really fully mimics the meat experience,” Paul explained. “So all of a sudden, you have this huge universe of omnivores who are happy to eat plant based every once in a while, especially if it still tastes the same as meat. And those companies really paved a new pathway." Like Paul, your industry will have an entire landscape that you need to understand before starting your socially responsible business. Who are the major players? What challenges do they face? What new technologies or ideas are emerging in the space? By understanding the industry as a whole, you can start to see how your business can make a difference. Final thoughts: launching a business that makes a difference There are obviously many more steps you'll need to take in order to launch a successful business, but Paul Shapiro's experience and advice provide a great starting point for those looking to make a difference with their business. Let's run through a quick recap of what we've learned: First, it's important to have a and how it will make a difference in the world. This can help inform all other aspects of your business, from branding to marketing to operations. clear idea of what you want your business to achieve Once you have that vision in place, it's important to and can help you turn that vision into a reality. surround yourself with people who share your values Next and find out what worked (and what didn't) for them. , learn from others who have started similar businesses And finally, in terms of emerging trends, opportunities, and challenges. conduct a thorough analysis of the industry you want to enter With social responsibility, keep in mind that it's not just the startups who can make a difference. Established businesses can also make a big impact by making small tweaks to their operations, and there are that can help you get started. plenty of resources and organizations If you're feeling inspired to start your own socially responsible business, I hope this article has given you some valuable insights to help you get started. And remember – my interview with Paul Shapiro is live on , so be sure to check it out for more tips on how to make your business a force for good. my YouTube channel

How to Start a Socially Responsible Business in 2022

How many of you have read the book Frankenstein by Mary Shelley or watched the 1920 fictional play R.U.R. (Rossum's Universal Robots) by Karel Capek? If you haven’t and you have an inclination towards Artificial Intelligence, you must. That’s where I see the roots of artificial intelligence, stepping out through creative brains. Perhaps, many industry experts call AI a blend of technology and creativity. It was during the mid-1950s when AI research started to explore the possibilities. What started as an academic discipline at a workshop at Dartmouth College in 1956, is today a full-fledged industry empowering numerous industries. It is expected that the will reach $60 billion by 2025. Backing this analysis is the exorbitant funding raised by AI startups. global AI market According to a by CB Insights, the investment figure reached $17.9 billion in the third quarter of 2021. Industry experts are affirmatively looking at a commendable hike in this figure. report Other revealed that investment in AI startups grew 6 times in the last 2 decades and the number of startups grew by 14 times. reports Numerous businesses, especially startups, are coming forward with an innovative and problem-solving approach. One such example can be noted with recent funding led by Gradient Ventures of $6.3 million for Mage. According to , the startup is developing an AI tool for product developers that can be built and integrated. Tech Crunch As quoted by founder Tommy Dang, “We worked with hundreds of developers having internal systems and great ML tools to launch models. But most of them didn’t know how to use those tools. That’s when we decided to build tools for technical non-experts.” Challenges Faced by Businesses in AI Startups While most of the industries noticed scattered growth moving without a direction, the AI startups like Mage are impeccably adding value to the expected future. However, it’s undeniable that there is a certain set of challenges that businesses are facing to implement AI. Some of the key challenges include: Lack of Understanding the Need Adopting artificial intelligence over traditional ways is a huge shift. This is further followed by the challenge to convince stakeholders about an unclear result. It’s surprising that with so many technological advancements and the benefits that follow, still companies fear overhauling their Modus Operandi. The reason here is understanding the need for AI. Most companies that haven’t yet integrated the technology, are unaware of the purpose they can solve. While the technology has been around for decades, there’s a need to create awareness and educate non-technical sections about the perks of artificial intelligence. Lack of Appropriate Data To build and implement AI requires a good amount of high-quality data. Companies at times fail to make proper investments in data management systems. These systems play a pivotal role in enabling AI. The failure will eventually leave you behind with no algorithm to solve business problems. Having a CRM tool that can help you collect data like customer behavior, demographics, on-site interaction, purchase pattern, etc. Eventually, the gaps can be filled using online data libraries and synthetic data. But if you don’t have a general interest in AI, you might not be able to realize the data you need, making it a forgotten fable. Lack of Skillset Ascertaining the data is just the first step. Skills to utilize data are a must-have to get AI at work. Most companies fail to hire machine learning and data experts, which eventually restrain your ambitions to move further. Additionally, some companies manage to onboard the resources but lack experience. This eventually slows down the progress. Having said this, the impact can also be noticed in the hiring process. That’s because the hiring managers often aren’t aware of assessing the right candidates and roles to be filled. It’s also been noticed that the HoDs (Head of Departments) are sometimes underqualified to lead the process. This results in integration issues, ongoing manual work, or inefficient processes. Eventually undermining the value of solutions. Inability to Find an Appropriate Use Case Without proper company-wide adoption, the strategy may have a negative impact. Without a flawless use case, the company will struggle to make a certain solution that provides business value. As a result, there won’t be concrete proof of how artificial intelligence can solve challenges. If you don’t have a clear idea of how you’ll use AI, it’s better to delay it until you find the answer. The Team Fails to Explain How a Solution Works To trust a computer as a model, it’s important for an individual to first understand it. Acknowledging this, if the AI team can’t explain, the implementation would end then and there. Challenge primarily comes when there’s a conflict in stakeholders’ expectations and model output. To better understand this, let’s take an example. If a doctor is relying on a machine to diagnose the patient and the algorithm disagrees with it, he/she should understand the reason behind it. If the model considers sneezing and headache to determine flu and doesn’t consider the age or weight of the patient, this will eventually lead to poor/wrong results that won’t help you identify the exact disease and diagnosis required. AI is Ready for Businesses. Are Businesses Ready? AI has evolved and transformed itself into a long-term solution for not just the challenges above, but more than that. While AI is prepared for businesses across various verticals, the question is are businesses ready? While a flawlessly powered AI model can enhance productivity by 40%, it’s important to determine how. Here are some key ways you can prepare yourself to leverage the best out of AI implementation. Moving Early Artificial Intelligence has immense scope for transformation with the right data in the hands of skilled people. If you’re aware of the tool and ways to use it, you shouldn’t delay it further. The significant loss that can be mentioned here is in context to your growth rate. You can undoubtedly reach new benchmarks by implementing AI in your business. Striking a Balance You need to strike a balance between quick tactical wins and your long-term vision. Both should go parallel to attain unprecedented results. You need to identify and automate quick wins that have the highest automation potential and have a close eye on comprehensive transformation over the long run. Long-term Vision While AI is known to give quick results if implemented and used properly, experts have always emphasized having a long-term vision. You got to know how your future transformation can be automated and further be utilized to achieve maximum growth rate. Don’t forget pounds to come in the future while collecting pennies today. Redefine Processes McKinsey's shared that 60% of jobs have the possibility of at least 30% automation. This includes redefining jobs and taking an end-to-end process view. report Each of them is necessary to attain value. Moving forward, you’ll have to redefine your work process. You’ll also have to manage organizational changes that will follow the AI implementation. Successful execution will eventually reap productive growth. Getting to the Core Build and integrate AI into the core model to attain lasting value and have a transformative impact. Fall in love with not just collecting data but also learning how to make informed decisions. Simultaneously, you should have a continuous hunger for improvement. This is because AI is an ever-evolving technology, and the best can be leveraged when you are open to future improvement patterns. AI isn’t the future!! You need it today. Ever wonder what would happen if one of the asteroids from a fictional movie published on Netflix, actually landed on Earth? Unimaginable but disastrous for sure. A few years back nobody knew that AI would play a vital role in identifying such threats. I came across a on this that introduced and explained by Airbus and IMB to me. Over the years, numerous industries have adopted and implemented AI into their core modus operandi. write-up project CIMON Acknowledging this, space exploration isn’t the only industry making profound decisions using AI. There are numerous other businesses across vivid industries doing the same. Retail AI and ML have introduced new verticals of data processing to the retail industry. According to , funding in retail AI has touched an all-time high of more than $100 million. This includes handling first-party data analytics, and concerns like eCommerce fraud, fulfillment, etc. CB Insights From customized promotions to inventory management, AI is redefining the entire retail landscape. Companies have harnessed AI to attain innovative solutions. Some noteworthy examples to consider include PepsiCo’s micro fulfillment centers in partnership with Dematic, Kroger’s vision-powered smart shopping carts, and much more. Electric Utility Recently, the electric utility industry is going through a storm of challenges like energy diversification, growing competition, and less regulated & complex markets. AI is a technology that has proven its capabilities through complex algorithms that entail it. The electric utility industry isn’t untouched by the wonders of technology. It plays a crucial role in fault prediction, managing renewable resources, maintenance through image processing, disaster recovery, and much more. Like other industries, AI is also assisting the electric utility industry by enhancing energy efficiency through prompt decision-making. Utilities like Innowatts and Autogrid have proved how AI can be of great help if integrated smartly and with precision. Manufacturing Challenges like machine failure, quality assessment, maintenance, inventory management, etc. are common and impact largely on the growth and sustainability of a manufacturing unit. A published by McKinsey, for manufacturing units, AI can enhance forecasting accuracy by 10-20%. report Having said this, you can eventually increase revenue by 2-3% and reduce inventory cost by 5%. The need is to look at the prevailing functions where traditional analytics can be leveraged. Healthcare The Healthcare industry has noticed a significant improvement in computation power resulting from speedy data collection and processing. A widespread implementation has been noticed in managing and maintaining health record systems. AI has also proved its worth by improving precision in robot-assisted surgery. Over time, AI in healthcare has commendably helped in the early detection of diseases. According to a , AI has helped healthcare professionals to detect mammograms with 99% accuracy. And this was attained 30 times faster than traditional ways while surpassing the need for biopsies. report Education In a published by market research engine, it’s expected that the use of AI in the education sector will reach $5.80 billion by 2025, featuring an exponential growth rate of 45%. report AI is playing some of the leading roles in the education sector including task automation, personalized learning, universal access, smart content creation, teaching the teacher, identifying classroom weakness, 24/7 assistance, etc. The implication is primarily bifurcated in three segments by model, namely, Learner model, Domain model, and Pedagogical model. Needless to mention, looking at the evolution, the models aren’t confined to the mentioned list. Concluding Note AI has been playing a pivotal role in transforming the way businesses work. The implementation isn’t confined to an industry or two. It has spread itself and is largely adopted by SMBs and brands across various industries. While technology is evolving rapidly, it’s crucial to have a team of skilled technocrats that can lead you through the right path. Once attained, you can make the most out of AI in your business.

AI is Not 'the Future.' You Need it Today

With 2020 well behind us, COVID-19’s presence continues to linger worldwide. Of all the industries that have been forever changed by the impacts of the global pandemic, healthcare arguably has changed the most. With significant advances in technology and methods necessary to support the high demand for access to healthcare and the growing digitization of protected health information, the healthcare industry has evolved in novel ways to continue to deliver the same exceptional quality of service. As we press on into the future, it’s critical to remain mindful of the trends driving healthcare technology in 2022. Although legacy software and infrastructure are critical to the success of modern hospitals and care centers, it’s important that we consider how those systems can integrate with newer technologies or how they may eventually be replaced with more reliable systems. The focus should be on improving performance, productivity, efficiency, and security without sacrificing reliability or accessibility. If you’re ready to explore the tech innovations driving the healthcare industry towards digital transformation this year, let’s take a look at the most important technologies that have the potential to transform your organization. Trend #1: Artificial Intelligence (AI) in Healthcare Across multiple industries, artificial intelligence has made great waves as a useful technology in 2022, especially for healthcare. AI’s Role Against COVID-19 The global pandemic has had a profound impact on our society, but cutting-edge technology has helped us stay ahead of the curve. In fact, a company from Toronto, Canada, was able to predict that COVID-19 would spread worldwide. By scanning 100,000 media sources in over 65 different languages daily, their application called can ascertain dangerous outbreaks in what is nearly real-time. BlueDot A great deal of progress was also made with machine learning advances in the development of vaccines. By using machine learning to help identify protein fragments, the have been developed in much shorter periods of time than ever before. vaccines for COVID-19 AI has also been helpful in analyzing crowd temperature data. This makes thermal screening a much more viable option for identifying potentially symptomatic individuals. Advances in AI-powered facial recognition have also made it viable toward identifying individuals even if they are wearing a face mask. It can also detect if the user is wearing a mask in the areas where it’s mandatory. AI in Diagnosis and Drug Development Artificial intelligence has plenty of applications outside of treating and responding to the pandemic. AI is incredibly helpful for improving efficiency with information processing and decision making. In the healthcare industry, machine learning is extremely helpful for the development of new pharmaceuticals and the efficiency of diagnosis processes. For those being treated for the effects of COVID-19, AI is helping to detect pneumonia. Microsoft developed , a radiotherapy AI tool. This dramatically speeds up the process of 3D contouring of the patient, bringing time to completion down to minutes instead of hours. The project is open-source on GitHub. analyze CT scans Project InnerEye is another Microsoft AI system meant to catalog biomedical research papers from PubMed. This helps reduce the time for cancer diagnosis and assists with deciding on which drugs should be used for each patient. Project Hanover AI in Mental Health Artificial intelligence innovations don’t just apply to physical health. MIT and Harvard University researchers to track trends and mental health in correlation to the COVID-19 pandemic. By using an AI model, they were able to analyze thousands of online Reddit messages to find that topics of suicidality and loneliness had nearly doubled over a period of time. This has the potential to transform our understanding of the mental health of larger populations. have utilized machine learning Natural Language Processing Chatbots have the potential to improve the efficiency of telehealth. Researchers at UCLA combined chatbot technologies with AI systems to create a (VIR). Virtual Interventional Radiologist This was intended to help patients self-diagnose themselves and assist doctors in diagnosing those patients. Chatbots powered by Natural Language Processing aren’t ready to provide primary diagnosis, but they can be used to assist in the process. They are also well equipped to help obtain information from patients before proper treatment can begin. The Key to AI in Healthcare: Data The most important element that powers artificial intelligence’s success in healthcare is data. More specifically, training data. Software powered by machine learning will never outperform the quality of its training dataset. The higher the quality and breadth of the data we give to the model, the better it will perform. It’s essential that your AI team is composed of experienced software developers and data scientists that can work together to produce the best results. Trend #2: Telemedicine and the Evolution of Remote Care has come a since the beginning of the pandemic in 2020. In 2022, care providers will regularly have video conference meetings with patients over the Internet to discuss concerns and give advice. Telehealth long way The infrastructure to support this has vastly improved. Telehealth is expected to grow to $185.6 billion by 2026. With that in mind, what lies in store for the future? Complying with Regulations Before we consider that possibility, one of the most important issues with telehealth is HIPAA compliance. Although some restrictions were relaxed during the height of the pandemic in 2020, it’s important for care providers to consider the applications that they are using to communicate with their patients. Are they secure and certified to handle private health information? WEBRTC for Video Conferencing In many instances, a more dedicated solution is required that can more specifically adhere to legal privacy requirements. If you need a dedicated telemedicine app, one of the most important technologies that will be needed is WebRTC, an open-source API-based system that connects web browsers and mobile applications and allows for transmitting audio, video, and data. This is especially helpful for teleconferencing features. Cloud Hosting and Data Storage Storing data in most cloud storage services is relatively secure but not necessarily compliant with government regulations on protected health information. solutions are critical for maintaining functionality and efficiency for any healthcare operation needing electronic health records (EVR). HIPAA compliant cloud hosting However, teleconferencing and data hosting aren’t the only features that may be useful for your organization. Other features like security, location services, appointment management, secure messaging, healthcare provider reviews, visit history, and wearable integration are all potentially useful features. Some applications may need to store fitness data from consumer devices such as Google Fit and Apple HealthKit. Being able to maintain these integrations in a secure and efficient manner can benefit the patient and caregiver greatly. Trend #3: Extended Reality in Healthcare Settings Extended reality, a blanket term including augmented reality, virtual reality, and mixed reality, has a great deal of potential in the healthcare industry. From assisting surgery to aiding telehealth applications, AR and VR technologies can improve the healthcare industry substantially. Augmented Reality and Mixed Reality in Healthcare Augmented reality and mixed reality are useful in a variety of healthcare settings. One of the most popular and useful forms of this technology is the use of mixed reality headsets like Microsoft Hololens 2 by . The headset can provide heads-up information to the surgeon while allowing them to use both of their hands during the procedure. surgeons Not only can these surgeries be enriched by this heads-up information, but it can be a collaborative and remote effort and assist in training purposes. The head-mounted camera view of the headset can enable other doctors to observe the surgery and offer advice. The ‘holographic’ nature of the device can be used to enrich training as well. Similar applications are possible with on-the-rise AR headsets. More specialized software solutions will also be necessary to expand its use to different types of surgeries into the future. AR isn’t just restricted to headsets and operating rooms. The technology can also be used to help nurses to draw blood from. find veins Augmented reality development relies heavily upon artificial intelligence and specialized sensors to function. Whether you’re developing for mobile devices or other kinds of hardware, appropriate data and software expertise will be required. AR developers focus heavily upon leveraging AI with the software frameworks of target hardware to make these products successful. Metaverse: Future or Hype? There is a big debate about whether Facebook’s rebrand to Meta and the focus on social virtual reality experiences is justified. Ultimately whether or not this is something that you are willing to invest in is up to you. Even if the metaverse is vastly overblown, there is some for virtual reality in healthcare settings. potential One of the most useful applications of VR in healthcare that is in use right now is training. Creating virtual training situations for doctors can help them improve their skills and prepare for operations. VR can also be used in some contexts for treatment. For example, The Virtual Reality Medical Center uses VR therapy to help those suffering from phobias like fear of heights and PTSD. Maplewood Senior Living in Connecticut also has a VR therapy program for the elderly that can help them unlock past memories and improve emotional wellbeing. https://youtu.be/4Fs0oYAK96o Meta’s shift toward cartoon-style meetings might become useful for VR therapy, but the effectiveness of this in place of traditional teleconferencing remains to be seen. However, some technologies in this space, such as spatial audio, have the potential to improve the effectiveness of telehealth systems by providing a more immersive digital experience. Trend #4: IoT and Wearables in Healthcare With wearables and IoT technologies becoming more popular, their potential in the healthcare industry has grown significantly. For applications in telemedicine and telehealth technologies, many have come to call this trend in micro-processing the Internet of Medical Things. There were connected at the start of 2021. The global IoT medical devices market is to reach USD 94.2 billion by 2026 from USD 26.5 billion in 2021. With the healthcare industry becoming increasingly more connected through these technologies, IoT cannot be ignored. 11.3 billion IoT devices projected Wearables One of the most important innovations in the healthcare industry is the advancement of wearable technology. The ability to monitor the status of a patient throughout the day remotely or for an individual to monitor their own status is incredibly valuable. A survey conducted by found that 39% of users had a smartwatch. With consumer smartwatches becoming more widely available, their potential to be used for healthcare applications should be noted. Deloitte One of the most basic things that a smartwatch can provide that can be useful for monitoring a person’s health is heart rate. However, this is not the only thing that a smartwatch can measure. These devices can also monitor physical health with pedometers and blood oxygen saturation. Low blood oxygen saturation is difficult to detect without specialized sensors. Since this can be a life-threatening condition, smartwatches with this sensor can save lives. Smartwatches are also improving in their ability to measure blood vitals in their users. Photoplethysmography (PPG) is an optical technology that can measure variations in blood volume and composition. Since it has been miniaturized for use on smartwatches, it can provide users with more data than ever about their blood vitals. Healthcare providers can use this data to help advise patients and complete diagnoses. Smartwatches aren’t the only wearable that has potential for the healthcare industry. Bio patches and have similar levels of impact. Bio patches can provide a better understanding of a person’s vitals without the use of a smartwatch. Artificial intelligence can also be used to improve the noise isolation of hearing aids. smart hearing aids Smart Pills One of the most profound applications for IoT technology in healthcare is the , which transforms The Internet of Things into . Smart pills are edible electronics that not only serve as pharmaceuticals but can provide care providers with valuable information about patients. The first smart pill was released in 2017. concept of a smart pill The Internet of Bodies approved by the FDA Creating IOMT Solutions With the industry trending toward using numerous microcontrollers in unison, getting all of these computers to communicate with each other can be challenging. Another obstacle that needs to be overcome is that almost every manufacturer uses their own proprietary protocol to get their devices to talk to each other. This can make integration difficult. Connectivity can also be an issue, as many environmental factors can disrupt communications. In order to overcome this, buffering methods on local microcontrollers need to become more robust. Security is always a concern as well. Trend #5: Healthcare Privacy and Security in 2022 Beyond the scope of efficiency and quality of care, privacy and security take critical priority in the healthcare industry. In February of 2021, Kroger pharmacy data was exposed in a through Accellion’s FTA secure file-transfer service. They’re not the only ones. According to HealthITSecurity.com, over 550 organizations suffered data breaches last year that affected over 40 million people. data breach Ensuring your organization is HIPAA compliant is an essential first step toward avoiding costly data breaches. If you are serving patients internationally, it may be a good idea to consider the regulations of the General Data Protection Regulation (GDPR) in the European Union. The HIPAA regulation covers a great range of activities and it even covers some that are not mentioned in the act directly. Electronic signatures that are used in online forms quite often are a great example of that. They are not mentioned in the regulation but covered entities have to ensure that they are using as these services will store data that is considered PHI for authorization and authentication purposes. HIPAA compliant e-signature services Erman Ergun, Healthcare Content Manager, JotForm Some healthcare providers are able to use software like Facetime and Skype to communicate with patients that may not be fully compliant with government regulations. Although the Office for Civil Rights (OCR) of the Department of Health and Human Services (HHS) in the United States has previously announced relaxed enforcement policies for organizations during public health emergencies, it’s important not to rely on that discretion. Eventually, as the pandemic continues to subside, enforcement will go back to normal. Getting ahead of the curve can help avoid steep fines in the future. Although compliant video conferencing software already exists, sometimes a more customized solution needs to be created. This is especially the case if the existing data infrastructure does not integrate well with available options. More importantly, if a healthcare provider wants to use an existing system to exchange ePHI with patients through third-party software, they will have to obtain a business associate exception with the vendor, which can be tedious and difficult. There still is no guarantee that the third-party program can fully protect patient data. In addition, keeping information secure through remote doctor calls is difficult. ePHI data must be transmitted in structured formats, and these calls can make the process complicated. Trend #6: Organ Care Technology & Bioprinting With the world’s transplantation market size predicted to reach , organ transplants are certainly an important part of the healthcare industry. $26.5 billion by 2028 According to Matthew J Everly, about take place in the United States every year. However, it’s estimated that over need a heart transplant. What can be done to help all of these people suffering from heart disease? 2,000 heart transplants 50,000 people Improving Organ Care Technology: Extending Time for Organ Evaluation and Transport One of the approaches to this issue is to improve organ care technology. This means taking care of the organ while it’s outside of the body. developed by Transmedics is a great example that is in use by the Ohio State University’s Wexner Medical Center. This device can keep a heart, lung, or liver outside of the body for several hours through proper care, heat, and provision of important nutrients. The Organ Care System It’s possible that the future of this technology may depend on artificial intelligence to automatically take action without a doctor’s intervention to preserve the organ for longer periods of time. Perhaps more importantly, machine learning may be able to better determine if an organ being preserved is suitable for transplantation or not. The faster that this can be determined, the more quickly a life could be saved. Bioprinting: Creating New Organs In addition to keeping organs alive outside of the body, other options should also be explored. Although it may sound like science fiction, are a very real, although developing, technology that has already made its way into clinical testing. Ears, corneas, bones, and skin are all organs in clinical testing for 3D bioprinting. 3D printed organs The process is not too different from traditional 3D printing. First, a digital model of the tissue must be created. Careful attention needs to be paid to the resolution and matrix structure, as the materials used in the printing process are quite literally living cells called . They then need to test the organ’s functionality with stimulation. bioink One of the ways that rejection of an organ can be prevented is by using the cells of the patient requiring transplantation. These cells can be grown in a culture and then cultivated into the bioink necessary for printing. Bioprinting has been done but has not yet hit the mainstream. It’s possible that through AI analysis of organs and of recipient patient characteristics, organs can be better engineered to be compatible with their new hosts. in the past Future of Healthcare Technology As 2022 rolls forward, healthcare technology will continue to improve in every area. Although security will improve across the industry, threats are always evolving that must be dealt with through prevention rather than response. Quality and efficiency of care will continue to improve due to groundbreaking and evolving technologies like artificial intelligence, machine learning, and extended reality. Written by , Chief Innovation Officer at . Oleksii Tsymbal MobiDev The full article was originally published and is based on MobiDev technology research. here

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