Punchh: Helping Retailers Understand Online and In-store Customers with their AI/ML Platform
Consumers are nowadays looking for experiences when they shop, go to restaurants or stay at a hotel. Psychological studies show that consumers are happier when they spend their money on experiences rather than purchasing things. Consumers, therefore, are demanding highly-tailored experiences and customer service from the brands they shop with.
To provide hyper-personalization in real-time, a brand, retailer or restaurant needs a deep understanding of its product/service usage and customer data. Most retailers, restaurants and brands have accumulated a lot of data but very few are leveraging it to their full potential. We are excited to be co-leading Punchh’s Series C financing since it’s one of the few companies that is using AI/ML on this data to not only provide very valuable customer insights but also enabling brands, restaurants and retailers to acquire and retain customers.
Punchh’s solutions enables a brand or a retailer to build a holistic view of who the customer is in real time, and based on that view, create a meaningful and ongoing relationship with the customer. Once this connection is created, a brand or retailer can keep them as a loyal customer forever and build a very profitable business relationship.
Although a brand or retailer has all the customer data including purchasing behavior from the POS, online purchasing data, CRM data and loyalty/email engagement data; it often only exists in silos. Moreover, the marketing and customer acquisition departments in most brands/retailers are quite siloed as well since there are different teams for online vs. in-store and there is no sharing of information or customer data between them. Punchh is able to ingest data into its platform from all these silos including data from POS in physical locations, ecommerce platforms, email engagement data from SendGrid/MailChimp and CRM data from Salesforce/SAP Hybris/Microsoft Dynamics and provide retailers and brands an unparalleled understanding of how their customers engage with them online and in-store. The company is able to use its AI/ML-powered models to enable the different online and in-store teams at brands/retailers to work together to target and acquire these customers with pinpoint accuracy and create a unique and custom experience for the customer which keeps them coming back.
Since originally investing in Punchh in 2018, we at Sapphire Ventures have believed that Punchh is very strategic for brands and retailers to figure out which customers have the highest lifetime value, which customer personas they should be pursuing, how to acquire them and how to keep them engaged. We are very excited to back the Punchh team again because the company’s products will play a significant role in helping brands and retailers win in this hyper-competitive environment by using customer data effectively and providing then with both an immediate lift in revenue and, more importantly, sustained long-term growth.
Disclaimer: Nothing presented within this article is intended to constitute investment advice, and under no circumstances should any information provided herein be used or considered as an offer to sell or a solicitation of an offer to buy an interest in any investment fund managed by Sapphire Ventures. Information provided reflects Sapphire Ventures’ views as of a time, whereby such views are subject to change at any point and Sapphire Ventures shall not be obligated to provide notice of any change. Companies mentioned in this article are a representative sample of portfolio companies in which Sapphire Ventures has invested in which the author believes such companies fit the objective criteria stated in commentary, which do not reflect all investments made by Sapphire. A complete alphabetical list of Sapphire’s investments made by its direct growth and sports investing strategies is available here. No assumptions should be made that investments listed above were or will be profitable. Due to various risks and uncertainties, actual events, results or the actual experience may differ materially from those reflected or contemplated in these statements. Nothing contained in this article may be relied upon as a guarantee or assurance as to the future success of any particular company. Past performance is not indicative of future results.