Venzee Technologies (VENZ:TSXv), recently announced increasing demand for revenue generating work orders as a result of their integrated channel partners. The recent news put Venzee back on investors radar with the shares increasing as much as 75% during intraday trading.
Venzee is a machine to machine (M2M) Artificial Intelligence (AI) API that automates and accurately distributes, in real time, a brands or manufacturers product information to large retailers (Amazon, Home Depot, Kroger, etc) removing human labor and manual processes that have been in place for decades.
According to one of Venzee’s active selling channel partners JASPER PIM the cost of this inaccurately distributed product information is staggering:
“The costs of having inaccurate data are massive. To put a number around it, globally, they estimated there was a loss somewhere in the vicinity of $40-50 billion in online sales just due to incomplete or inaccurate product data – and that’s just on direct-to-consumer E-commerce business.”
This makes me want to dig into this a little deeper, so I am sitting down with John Abrams, CEO of Venzee Technologies to simplify the proprietary tech and how Venzee makes money.
Arlen Hansen: John, thanks for sitting down with today. I think the first question most investors would want to hear is. What exactly is product content information?
John Abrams: Product information is ANY attribute used to describe, measure, or visualize a good for sale.
Just search any product on Amazon or other online retailers. All the information you see about the product, including pictures, marketing content, dimensions, weights, pricing, is all product information.
Historically, you would go to a store and trust what you see, touch and feel to make your buying decision. That has all changed now. People view images and read online descriptions to make a buying decision. Only when the package arrives, do people find out it’s not the color they wanted, the description wasn’t accurate, the size or weight wasn’t accurate, which results in a product return. Product returns cost retailers and brands billions of dollars a year.
Most consumers report they will not buy from a brand that failed to meet their expectations but statistics show approximately half of product information analyzed from 12 leading companies was incorrect resulting in more than a third of all products ordered online being returned. And that cost is enormous to the brands and online retailers.
AH: By brands and manufacturers, I assume you mean any brands you can buy online, such as Nike, FitBit, Sony, Eyewear, Cosmetics etc?
John Abrams: Yes exactly, but it goes much further than what you and I can buy online. It captures the product information manufacturers need to provide to their clients for the manufacturing of finished goods to sell including importing and exporting regulations. Governmental and regulatory agencies also have extensive requirements for product information down to the component level of a product. So when Jasper estimates that incorrect product information costs between $40 – $50B per year, that’s just direct to the consumer, it actually is a much bigger problem down the whole supply chain when you include business to business (B2B). And Venzee addresses this issue of manual and paper based supply chain.
AH: Great thanks. Content Management Systems (CMS) partners are actively marketing, selling and using the Venzee distribution platform. What is a CMS?
John Abrams: Large brands and manufacturers use Content Management Solutions (CMS) to organize and store the information about their products, much like a company uses Salesforce to store information about their customers or clients. It’s essentially a massive database of a brand’s product information.
A brands’ product information within a CMS, holds hundreds of attributes, which they can sort through, manage, search, and update. This could include multiple images, product description, promotional content, instruction manuals, safety hazard instructions, where it was manufactured, MSRP, height, weight, depth, various country units (lbs to kilos, inches to centimetres), box dimensions, included parts, size and weight of included parts. Every marketing, sales, regulatory, logistics and engineering detail about a product is in a CMS database. This can be multiplied even further by the different languages and regulations of a product in various countries it is sold.
CMS include Product Information Management (PIM), Digital Asset Management (DAM), Master Data Management (MDM) amongst others. In addition to a large monthly fee, a multinational brand enterprise may pay hundreds of thousands of dollars if not millions , to have this CMS integrated, customized to their specific enterprise needs.
As important as a good CMS is to manage the complexities of product information, a CMS is an internal management tool – not an external distribution software.
And that is the pain point that Venzee addresses. The automated distribution of accurate product information to global online retailers in real time. Using Venzee, a brand (through their CMS) can move product information to a Venzee retail channel at the push of a button. Until now, that process could take months of manual effort from overwhelmed teams, resulting in inaccurate product information, limited retail distribution, delays to market, a high cost of returns, and unsatisfied customers.
AH: So how does Venzee make money?
John Abrams: Very simply. Brands and manufacturers pay Venzee a set fee per retail channel per month and it’s highly scalable. A pattern we are seeing is that our multinational clients want to start at 1 or 2 connections,which quickly turn into additional requests, additional retail channels once they see the technology in action.
For example, one brand sending to 50 retailers totals 50 active channels for monthly recurring revenue to Venzee. A second brand could be distributing product information to the same 50 retail channels, but that gives us monthly recurring revenue from 100 active connections, or the total number of retail channels the brands are sending information to.
AH: That’s great. I guess I would take this opportunity for you to address prospective and existing shareholders. Any closing comments?
John Abrams: The bigger the brand, the bigger the more acute the pain. If your a manufacturer with one product in one retailer, automating the process with Venzee isn’t critical but brands with hundreds of products going to tens, hundreds or thousands of retailers the ROI for brands to use Venzee is incalculable versus the cost of human labor to distribute the product information and the result of inaccurate product information. That’s why we are winning multinational brands through our CMS partnerships.
With over $10M spent on development, I believe we have built an extremely valuable and proprietary tech that brands, manufacturers, retailers, customers and the whole global supply chain could all benefit from. I anticipate, with the existing work orders from multinational brands, while expanding our channel partnerships, investors can look forward to a very consistent month over month growth in active retail connections and associated monthly recurring revenue moving forward.
AH: Thank you for your time John. That was very informative.
John Abrams: Thank you. It’s very exciting and I’m looking forward to being able to update the market consistently on our corporate growth.
Arlen Hansen, President, Kin Communications
Please read this disclaimer in its entirety before reviewing any opinions, views or information expressed by Kin Communications Inc. (“Kin”). If you do not agree to all of the disclaimer, do not access any materials or information presented by Kin. By accessing these materials, and whether or not you have actually read this disclaimer, you are deemed to have accepted it.
The opinions or views expressed on social media platforms maintained by Kin Communications Inc. (“Kin”) represent the thoughts and opinions of individual users. The opinions and views expressed on these platforms do not in any way reflect the views of the site they are posted on, other sites affiliated with those sites, or the Kin staff involved with maintaining the site. Kin does not control or guarantee the accuracy, relevance, timelines or completeness of opinions, views and information presented on these sites. While Kin makes reasonable efforts to verify the accuracy of information presented, readers are strongly encouraged to conduct their own independent due diligence.
No opinions, views or information presented should be construed as a solicitation to buy or sell the securities of any third-party mentioned. Kin, and its principals, are not registered broker-dealers or financial advisors. Before making an investment in any securities, you should consult with your financial advisor and a registered broker-dealer. Never make investment decisions based solely on opinions, views or information presented on these sites. In certain cases, Kin is paid by third-parties mentioned on these sites to disclose information and opinions. In addition, Kin and its principals may own securities of those parties mentioned. As a result, Kin and its principals would have a direct financial interest in the parties mentioned. Therefore, any information provided should not be construed as independent financial analysis or recommendations but as advertisement.
Certain information presented may contain or be considered forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors which may cause actual results or events to differ materially from those anticipated in these statements. There can be no assurance that any such statements will prove to be accurate, and readers should not place undue reliance on such information. Kin does not undertake any obligations to update information presented, or to ensure that such information remains current and accurate.