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New software delivers for Otto

By Retail Technology | Monday March 13 2017

Multichannel German brands retailer Otto has shortened delivery times and improved customer satisfaction with new replenishment software

The company has been using Blue Yonder’s machine-learning solutions for accurate demand forecasts of its own products and has been doing so for several years. But it has now expanded its use of Blue Yonder’s machine learning solution to goods from its partner retailers, providing automated replenishment across all products.

Since automating the process with Blue Yonder, Otto has been able to deliver third-party items in one to two days, without risking overstocking at the warehouse. 

The Blue Yonder Replenishment Optimization then uses forecasts to deliver automated decisions

For its predictions, Blue Yonder analyses around three billion transactions from past sales, prices and stock levels.


“The benefits of automated decisions becomes evident when you put it into practice,” said Michael Sinn, director of category support at Otto. “We consider it accurate when we sell out of items ordered from our retail partners within 30 days. With automated replenishment decisions from Blue Yonder, we achieve this 90% of the time. This is extremely valuable for us.”

Increasingly, the goods bought based on Blue Yonder’s automated decisions are not even put into storage. Instead, they are sent directly to the customer.

Artificial Intelligence ensures faster delivery times, fewer returns and a reduced carbon footprint in the delivery chain.

“Otto’s strategy shows how imperative machine learning is to improving customer 
satisfaction,” said Prof. Dr. Michael Feindt, chief scientist and founder of Blue Yonder. 
“Everyone profits from automated replenishment processes: The customers through shorter delivery times, the suppliers through improved planning oversight, as well as higher demand. Otto gains through lower warehouse and shipping costs.”

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