CNME Editor Mark Forker sat down with Sadique Ahmed, CEO of Pathfinder and Founder of RetailGPT, to find out how their AI-powered platform is converting malls into digital marketplaces, empowering retailers and equipping smaller stores with the tools to compete with industry titans such as Amazon and Noon.
Sadique Ahmed has been the dynamic driving force behind the global success of Pathfinder.
Pathfinder has undergone several iterations since it was first established in 2000, and during those 25 years it has emerged as a market leader in ‘retail intelligence’.
Pathfinder initially worked with retailers in the UK, and worked with customers across the entire retail spectrum from apparel, food, groceries and lifestyle.
Ahmed has witnessed the evolution of the retail sector, but with consumer expectations and demands now ever-evolving, businesses have to ‘personalise’ in order to stay relevant in the current climate.
RetailGPT is an AI system designed to revolutionize retail operations by offering personalized shopping experiences, automated customer service, and insights into inventory management.
Ahmed kickstarted the conversation by highlighting the fact that their primary customers where those in retail real-estate.
“Over the years at Pathfinder, we have witnessed profound change and transformation, but the emergence of e-commerce really was seismic, as it enabled retailers to really scale their businesses online. We were working closely with retail real-estate, and when I say retail real-estate, I’m referencing brick-and-mortar stores. Shopping centres, airports and the high-street retailers were all customers that we were very hands-on with. One of the biggest challenges we were solving for retail landlords that were operating in the airport and shopping centre space was revenue assurance,” said Ahmed.
As Ahmed explained, retailers don’t give a fixed rent, but instead provide landlords with a percentage of their turnover.
“There was never any automation that existed that provided transparency on what the retailer sells and what he reports to the landlord as to what he has sold. We developed a real-time platform where if a someone went to Starbucks and bought a coffee, then I would have that data with me. So, I do that on behalf of the landlords to actually capture the entire sales transactions that are happening in every single till in both the shopping centre and airport. That led us to a very big revolution, and nobody imagine that we would create that type of platform, and initially it was an almost impossible task of integrating over 500 brands across 200 hundred shopping centres, and we were all of a sudden sitting on an ocean of unstructured data,” said Ahmed.
However, as Ahmed pointed out, the entire integration process was a painstakingly slow one.
“It took us 14 years to have 10,000 retailers on our platform. So, we asked ourselves a couple of questions. The first one was, how do we scale from 10,000 to a million, and how do we do that without it taking a complete lifetime to do it? We also asked ourselves how can we continue to add more value to help retailers continue to grow, because these brick-and-mortar stores were being hurt by the meteoric rise of e-commerce, so we knew we had to rethink our value proposition,” said Ahmed.
Ahmed stated that it was clear that brands had a real appetite to grow and diversify their business, but a number of factors were slowing their growth journey.
“It was clear that brands wanted to expand, but it was evident that they were not growing at the pace they were supposed to, and primarily it was due to the fact that too many channels opened up. The omnichannel era was born, and then that was accelerated further by the rise of e-commerce, so a combination of both these factors put pressure on brick-and-mortar stores. So, the question of how do we help these retailers really led us to create RetailGPT,” said Ahmed.
Ahmed said Pathfinder engaged in extensive research and spoke to each of their customers to find out their pain points, and it quickly emerged, they were all suffering from the same issue.
They didn’t know who their customers were, and they wanted to know how they could increase their non-GLA revenue.
“We spoke to the brands in the malls and shopping centres, and they admitted they didn’t know who their customers were. Hundreds and hundreds of people were coming into their outlets daily, but they didn’t know who they were, why they were coming, or what they wanted. It was a complete disconnect between the footfall into the store versus the actual business taking place. We had to help them to digitally transform the shopping centre into a marketplace, and create extra non-GLA revenue into the mall. Non-GLA revenue is a mouth-watering for our customers because you essentially get money for free. How do I increase my non-GLA revenue was the question being asked by those businesses in the mall, and they wanted to know the answer, and because they have a share of revenue with every single retailer in the mall, they really wanted the retailers to do well,” said Ahmed.
One of the major challenges facing retailers was the fact that they were relying on footfall, plus as Ahmed points out the retailer also has to try and attract that consumer as soon as he sets foot in the mall, and convert that consumer into a customer.
“The question I was asking was how can we increase the footfall for these retailers, and how can we improve conversion? It took us 7 years to build and develop RetailGPT, we didn’t rush the innovation of the platform. Now, the question your readers want to know is what exactly does RetailGPT do for the retailers. RetailGPT transforms the mall into a digital marketplace. It enables the brick-and-mortar store to have a digital version as well, which means that the consumer can buy online from the exact same store that he would visit in the mall, but crucially with the digital version now enabled the retailers get to know who the consumers are, and this really is key. The visibility is crucial for retailers and it’s going to drive business, and overall, the mall is going to see an upside curve in the whole journey of revenue,” said Ahmed.
Ahmed also highlighted how RetailGPT’s platform enables malls to expand their digital offering, by allowing brands that can’t access physical space in a mall, to be part of the online platform.
“Let’s take the Mall of Emirates as an example, and let’s say they have around 400 outlets. There is always a huge list of around 250-300 of outlets who want to have an allocation of stores inside the mall, and these are big name international brands that are not present in the UAE yet. They want to have prime space, but there’s no space for them physically. However, thanks to our platform consumers suddenly have access to an additional 250 international brands, who are now selling their merchandise on the mall’s digital marketplace. So, as a consumer then I’m delighted because I’m coming to the mall, but I’m also digitally-engaged, and I can now buy products from international brands that are not physically here in the UAE,” said Ahmed.
As Ahmed points out, the system also allows these international brands to test the water, and see if their products and merchandise resonates with the marketplace before making any future investment into a physical store.
“The platform provides a huge opportunity to the brands to leverage the UAE marketplace and reach the consumer, whilst at the same time it gives the mall visibility on which of the 250 brands are actually performing well in terms of generating revenue. If the mall can see that 10 brands are resonating very positively with consumers in the UAE, when space becomes available they can go to those businesses and let them know that they can now establish a physical store in the mall. Those brands that perform get the space allocation. At the end of the day, if a brand performs well then the mall gets more money from assured turnover rent. Malls don’t want to give that premium space to a brand, that may be huge elsewhere, but for one reason or another it just doesn’t strike a chord with the marketplace here in the UAE. They would lose time and money, so our platform digitally-onboarding brands allows the malls to see how they perform. It also protects brands from making a huge investment into a physical store that doesn’t make money for them. That’s just one of the many powerful capabilities of RetailGPT,” said Ahmed.
Ahmed said that their platform was democratising the marketplace and was equipping businesses with the tools to fight back.
“There was a monopoly on the market, you had players like Amazon and Noon that provided convenience and speed of delivery as an option. Neighbourhood stores couldn’t compete with that and it requires a lot of technology and enablement for those type of neighbourhood boutiques and stores to be able to do that. RetailGPT democratised the entire marketplace, we made it easy like a plug-and-play for a store to sign up and pay a subscription to the platform, and the entire technology stacks becomes available to them. That enables these stores to compete equally with the biggest players in the market head-on offering their merchandise with the same convenience, benefits and speed. You’re creating a social impact by doing this and you’re helping these bricks-and-mortar stores to keep pace with changing consumer behaviour and give the same level of convenience at a very affordable cost, and that is democratising the market,” said Ahmed.
Ahmed emphasised that whilst they are in the business of democratising and using their technology to empower businesses, he reminded me that they don’t create the technology driving RetailGPT.
“We don’t create technology, we use technology. We use AI, we don’t create AI. Every time that AI improves then I deploy it immediately because my offering gets better. We have competition when it comes to e-commerce, but when it comes to what we are doing with the physical retailers and creating those digital marketplace for them and international brands, we are the outlier. We are totally unique,” said Ahmed.
Ahmed concluded a fascinating and candid exchange by revealing the number of retailers he wants on their platform by 2030, and the growing demand that exists for their platform.
“By 2030, we want 3 million retailers on our platform and around 50 million users globally. We have an advantage in the market because of our domain experience and the journey we have been on for the last 10-15 years. We literally lived at the mall and lived with those retailers, so we had an intrinsic understanding of their problems. We knew their pain points and what they were craving, and we knew how we could turn things around for them. It didn’t happen overnight for us where we had a eureka moment, and decided we have an idea, let’s do it. It was a journey of learning that led us to the inception of RetailGPT,” said Ahmed.
