How AI-Powered Product Tagging Helps Brands and Retailers With Sustainability Goals

AI Tagging supports retailers’ sustainability strategies by forecasting supply and demand and reducing over-manufacturing, stockouts, and excess inventory.

Floral dress scanned by AI

As brands and retailers increasingly explore ways to create more sustainable business models, Syte is helping its customers — including Farfetch, Prada Group, and Hibbett Sports — address their sustainability goals through AI-driven technology.

A recent report found that there is a significant disconnect between retail leaders and their consumers when it comes to sustainability, with consumers across all generations — from Baby Boomers to Gen Z — willing to spend more on sustainable products. While two-thirds of consumers say they will pay more for sustainable items, an equal two-thirds of retailers believe that consumers will not pay more.

Shoppers Seek Sustainable Materials

Syte’s customer data in the second half of 2022 supports the consumer, with trends indicating the growth of purchases in sustainable and eco-friendly materials. For example, Syte’s fashion and home decor clients saw 23% and 7% upticks, respectively, in jute products from Q3 to Q4 2022. Likewise, in the same period, purchases of home decor items made with natural materials such as wood and stoneware increased by 6% and 166% respectively. 

“Brands are going to have to focus more and more on product sustainability in the foreseeable future. It will be paramount for forward-thinking brands to begin looking at innovative ways to enhance their sustainability efforts through technology,” said Vered Levy-Ron, CEO of Syte.

“Syte’s AI Tagging tools allow retailers to create sustainable shopping experiences by better predicting consumer demand, thereby reducing overstock and stockout scenarios, which lead to wastage and put pressure on an already taxed global supply chain. Syte’s solutions also solve challenges unique to the second-hand market, helping brands and retailers overcome the pains of inventory limitations and product discoverability as well as streamlining product tagging in resale marketplaces,” she added. 

Where AI Tagging Comes In

Syte’s AI Tagging automatically produces a comprehensive list of product tags down to minute details and attributes of any given product — from sweaters and shoes to bracelets and couches. Syte’s AI Tagging analytics inform demand forecasting and assortment planning, enabling merchandisers to align products with shopper preferences. With more precise product tags, retailers can discover precisely what their customers are looking for, eliminating the need to reorder or manufacture products that aren’t of interest. 

By producing the correct quantities and avoiding surplus, brands and retailers can avoid managing larger inventory space and the increased warehousing costs that come with it. Lesser warehousing translates into a reduced carbon footprint due to lower energy consumption — whether from operating, lighting, heating, cooling, or ventilating a storage space.

By leveraging Syte’s flexible merchandising rules and ranking strategies that power AI-based Recommendation Carousels, retailers can also promote overstock items on relevant product listing pages (PLPs) or product detail pages (PDPs) to draw shopper attention and, in turn, drive conversion (CVR) and inventory turnover.

As pressure mounts from consumers desiring sustainability improvements from the retail industry, brands of all sizes will need to commit to reducing their carbon footprint and overall product waste. Fortunately, AI technology is helping to bridge those gaps, offering realistic solutions for retailers to progress toward business models that prioritize sustainability and encourage real and measurable progress.