Despite talk that e-commerce is killing brick-and-mortar retail, the vast majority of shopping still takes place in physical stores. But it’s often easier to monitor inventory, analyze consumer spending habits, and make on-the-fly adjustments for digital storefronts than it is for their real-world counterparts.
A Boston-area startup called ThirdChannel wants to help change that, aiming to deliver the kind of real-time data analytics for brick-and-mortar retail that businesses now expect from their e-commerce operations. Investors are betting ThirdChannel is on to something—the company announced today it raised $7 million in a Series A funding round led by Fung Capital. The startup previously pulled in $2.1 million from investors, according to a statement e-mailed to Xconomy.
Cambridge, MA-based ThirdChannel argues that retailers and brands have struggled to keep up with the rapidly changing expectations that shoppers have for physical stores in the e-commerce era. Many businesses make product and merchandising decisions based on stale information, and “mediocre” in-store experiences have hurt brick-and-mortar sales, the company says in a press release.
“Retail execution failure is typically at the heart of weak store sales,” says ThirdChannel founder and CEO Gina Ashe (pictured above) in the e-mailed statement. She previously co-founded Krush and Sermo.
ThirdChannel wants to help boost in-store purchases with a software dashboard that it says churns out useful insights and recommendations from information fed to it by store employees or a brand’s field workforce—think data about inventory levels, store traffic patterns, product demand, and even the effects of weather on sales. The goal is to give retailers and brands the tools needed to quickly identify and resolve problems, ThirdChannel says.
The startup also says it has amassed a network of more than 100,000 people that its customers can hire on a temporary basis (or longer) to serve as in-store brand ambassadors, sales trainers, visual merchandisers, intelligence gatherers, and marketers.
While e-commerce companies have reaped big investments over the past two decades, ThirdChannel is part of a group of young venture-backed startups offering technologies aimed, at least in part, at goosing brick-and-mortar retail. Other examples in the Boston area include NewStore, whose mobile software tries to unify the offline and online shopping experiences; Mobee, which uses crowdsourcing and mobile tech to gather and analyze in-store retail data; and Celect, which developed machine learning tools for managing offline and online inventory. Each of those companies made moves this year—NewStore closed a $50 million funding round; Mobee merged with San Mateo, CA-based Quad Analytix; and Celect announced a $10 million funding round.
The bottom line is this field seems crowded, and it’s not clear yet how ThirdChannel will stand out. For now, the startup has more money to give it a shot.
ThirdChannel says it plans to use its new funds to push its product to more brands and retailers. Its customers include Adidas, Bose, and Calvin Klein, according to its website. The 35-employee company also plans to hire more people in software engineering, data science, product management, and sales and marketing, according to the e-mailed statement.