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    Anticipatory Shipping - Predictive Analytics

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    Sandeep Kumar
    Predictive analytics uses statistical and machine learning techniques to analyze current data and predict future events. In the 1990s, Professor Hau Lee founded Non-Stop Logistics to forecast inventory needs and ship goods anticipatorily to distribution centers. Amazon's concept of speculative shipping involves shipping items to geographic areas without a specified delivery address, then completing the address details during transit based on predictive models analyzing customers' purchase histories and online behaviors to forecast demand. This approach aims to speed up deliveries using forecasting to proactively move goods closer to customers.

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    Anticipatory Shipping - Predictive Analytics

    Uploaded by

    Sandeep Kumar
    203 views11 pages
    Predictive analytics uses statistical and machine learning techniques to analyze current data and predict future events. In the 1990s, Professor Hau Lee founded Non-Stop Logistics to forecast inventory needs and ship goods anticipatorily to distribution centers. Amazon's concept of speculative shipping involves shipping items to geographic areas without a specified delivery address, then completing the address details during transit based on predictive models analyzing customers' purchase histories and online behaviors to forecast demand. This approach aims to speed up deliveries using forecasting to proactively move goods closer to customers.

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    Predictive analytics uses statistical and machine learning techniques to analyze current data and predict future events. In the 1990s, Professor Hau Lee founded Non-Stop Logistics to forecast inventory needs and ship goods anticipatorily to distribution centers. Amazon's concept of speculative shipping involves shipping items to geographic areas without a specified delivery address, then completing the address details during transit based on predictive models analyzing customers' purchase histories and online behaviors to forecast demand. This approach aims to speed up deliveries using forecasting to proactively move goods closer to customers.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    203 views11 pages

    Anticipatory Shipping - Predictive Analytics

    Uploaded by

    Sandeep Kumar
    Predictive analytics uses statistical and machine learning techniques to analyze current data and predict future events. In the 1990s, Professor Hau Lee founded Non-Stop Logistics to forecast inventory needs and ship goods anticipatorily to distribution centers. Amazon's concept of speculative shipping involves shipping items to geographic areas without a specified delivery address, then completing the address details during transit based on predictive models analyzing customers' purchase histories and online behaviors to forecast demand. This approach aims to speed up deliveries using forecasting to proactively move goods closer to customers.

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    Anticipatory Shipping

    using Predictive
    Analytics

    What is Predictive Analytics?


    Predictive analytics is a branch of advanced analytics that is
    an assortment of statistical and mathematical techniques
    used to predict the probability of future events occurring.
    Predictive analytics uses many techniques from data mining,
    statistics, modeling, machine learning, and artificial intelligence
    to analyze current data to make predictions about future.
    The term Predictive analytics
    is generally used to mean
    predictive modeling and forecasting.
    Increasingly being used to refer to analytical disciplines such as
    descriptive modelling, decision modelling or optimization.

    History
    In the mid-1990s, Stanford University Professor Hau Lee,
    founded a company called Non-Stop Logistics
    Non-Stop's concept was to forecast, for example a week's
    inventory needs for a series of SKUs in a given metro market.
    Manufacturers would then ship to that forecast, and a Non-Stop
    cross-dock center would fulfill to individual stores based on later
    stage insight into inventory levels and demand.
    The idea was that aggregate forecasts for a market would always
    be more accurate than the specific forecasts for store chains or
    individual outlets.
    Non-Stop eventually morphed into supply chain planning software
    vendor, which was later acquired by Manhattan Associates.

    Amazons concept for Speculative Shipping

    "In conventional order fulfillment systems, an item is not shipped (or


    in many cases even packaged for shipment) until a customer places
    an order for that item to be delivered to a specific delivery address.
    However, a package including one or more items may be shipped to
    a destination geographical area without completely specifying a
    delivery address at the time of shipment. Instead, a delivery address
    may be completely specified while the package is in transit.
    "Such shipment of packages without completely specifying delivery
    addresses at the time of shipping may also be generically referred to
    as speculative shipping, and completely or partially specifying a
    delivery address for a package after that package has shipped may
    be generically referred to as late addressing. In such embodiments,
    speculative shipping may also be referred to as anticipatory
    shipping."

    How does Amazon know what you want?


    According to the patent, this forecasting model uses data from your
    prior Amazon activity, time on site, duration of views, links clicked,
    hovered over, shopping cart activity and wish lists.
    When possible, the algorithm also sprinkles in real-world
    information gleaned from customer telephone inquiries and
    responses to marketing materials, among other factors.
    Together, this can provide decision support for speculative
    shipping of Items, per the patent.
    Of course, Amazons algorithms might sometimes err, prompting
    costly returns. To minimize those costs, Amazon said it might
    consider giving customers discounts, or convert the unwanted
    delivery into a gift. Delivering the package to the given customer
    as a promotional gift may be used to build goodwill, the patent
    said.

    References
    United States Patent and Trademark Office
    Predictive Analytics world
    Predictive Analytics future forecast
    SC Digest: Not quite as wild as Drone concept, but impres
    sive thinking nonetheless
    Amazon.com Research and development expense
    WSJ: Amazon Wants to Ship Your Package Before You Buy
    It
    Forbes: Why Amazon's Anticipatory Shipping Is Pure
    Genius
    Techcrunch: Amazon to
    Start Sending Stuff Before Youve Bought It

    Thank you!
    Questions?

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