As consumers, we are presented with incentives nearly every day, if not multiple times a day. Whether it's a gift with purchase or a discount code, incentives are at the heart of how brands adjust price points to find our sweet spot. For some of us, these incentives regularly influence our buying behaviors, while for others they are simply another email or text to ignore.
Brands all over the world engage in this delicate dance of persuasion every day. Yet, despite the direct effect incentives have on brand reputation and revenue, the strategies behind them are often loosely defined, relying on general behaviors instead of individual user knowledge.
Enter Monocle, a game-changer in this field.
Monocle leverages advanced AI technology to generate personalized incentives at scale. Monocle’s technology enables brands to understand the cause and effect behind their key marketing decisions and ensures they attract and retain customers while maintaining healthy margins.
Using cutting-edge Causal AI technology to refine the art of incentives with a team experienced at implementing this technology at industry leaders like Lyft, Instacart, and Stripe, we are excited to share why we invested in Monocle, the AI-powered promotions platform set to take e-commerce by storm.
Unparalleled Leaders in Price Optimization
Monocle's team, composed of CEO Noam Szpiro and COO Mark Lotman, stood out to us from the beginning. We were introduced to Noam when he was still at Instacart and had just moved back to Israel. Our conversations revealed Noam's innovative work at Lyft, where he used Causal AI for promotion optimization. His deep understanding and unique application of this technology immediately caught our attention.
Shortly after, we had the opportunity to meet Mark, who also has an extensive background in price optimization. It was apparent that Noam and Mark were a world-class team, embodying the industry's leading expertise in price optimization and AI.
Their technical skills were matched by their practical experience, with Noam having applied his knowledge at Lyft and Instacart, and Mark contributing his expertise to McKinsey and Stripe. It was this combination of technological proficiency and real-world application that inspired us to offer them an opportunity to work from our offices and drive their vision forward. In just those first few months, they onboarded several established brands such as Honeylove, Death Wish Coffee, and BRUNT Workwear. Each of these brands saw a significant increase in revenue after incorporating Monocle's technology, reinforcing our belief in Monocle’s potential.
Redefining Incentives with the Power of Causal AI
Monocle's technology leverages Causal AI, a relatively new and promising branch of artificial intelligence. While traditional AI and machine learning focus on prediction accuracy, like forecasting revenue or user group behaviors, and Generative AI concerns itself with generating user-facing content, Causal AI delves deeper to understand the cause and effect of actions. This focus on causality provides an invaluable tool for decision-making.
Implementing Causal AI at scale presents challenges due to the need for accurate handling and interpretation of data. However, Monocle has simplified this process for brands with a brief learning period, during which it observes and learns from customer reactions to various incentives.
Currently applied to promotions, Monocle envisions Causal AI as a tool for future decision-making. Incentives come in various forms, each carrying a cost. Causal AI helps brands understand the potential impact of these actions, ensuring they target the right people who are likely to change their behavior.
E-Commerce is Pushing for Personalization
The e-commerce market is projected to hit $8 trillion by 2026, with approximately $400 billion spent annually on promotions. Furthermore, e-commerce marketing expenditure typically ranges from 15-20% of revenue, with some businesses spending up to 30% for customer acquisition.
The digital marketplace is fiercely competitive. Brands are constantly battling for consumer attention, making effective marketing strategies crucial. Brands use various platforms for their marketing efforts, such as those managing email, SMS, and direct mail. However, the decision-making process about who receives which promotional material is often generic.
Promotions currently account for over 50% of the marketing budget. However, the real potential is in personalized promotions, which are currently underutilized, making up only 5% of all promotions. This suggests a significant opportunity to enhance promotional strategies and target consumers more effectively.
A Future of Smart Decision Making for Brands
While Monocle’s initial focus is on promotions, its ultimate objective is to completely transform decision-making for brands. By understanding the exact cause-and-effect relationships of various actions - such as sending a postcard, an email or an SMS, or offering a pop-up discount - Monocle can demonstrate the direct impact of these actions on customer behavior. As such, Monocle aspires to help every brand in maximizing their customer value, becoming the decision-making platform that consistently guides brands to make the right choices about their customers.
Learn more about Monocle.
