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Retail advertising and AI-driven security solutions company growing rapidly

Brieanna McCutcheon , The Market Herald Canada
0 Comments| November 16, 2023

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The location-based technology provider INEO Tech Corp. (TSXV:INEO) started growing its business right here in Canada but has since expanded to 23 states across the United States and even Colombia.

The company has managed to combine advertising at storefront entrances, displaying marketing material while simultaneously protecting store inventory. To talk more about that and the new media network is the CEO of INEO Tech, Kyle Hall.

TMH: So, as mentioned, the company has a two-in-one method, advertising while combating loss prevention in this Welcoming System that you guys have. Can you walk our viewers through the technology that has gone into crafting this?

Hall: For sure. We had to create a lot of new technology from scratch because what we did is something that people said couldn’t be done.

So, if you think of those loss prevention sensors at the front entrance of retail stores, there’s these archaic old, you know, old things at the front of the stores. And retailers typically fit cardboard sleeves to put over top of them to market things because it’s a great place to advertise. It’s the first thing you see as you walk into the store. Last thing you see as you leave.

And these things are there because they detect little tags on clothing, around boxes so that this retailer knows when something’s going out of the store that hasn’t been paid for. So, in order to detect that tag you can’t put any electromagnetic signal anywhere near these, let alone a big bold marketing screen.

And we perfected a way to put a big bright marketing digital display screen inside of the loss prevention system so that we can sell advertising at the front entrances and exits of the retail store.

TMH: And then what are some of the loss prevention features that the system is equipped with?

Hall: The standard old systems would detect a tag and they would beep, they would flash a light. That was the extent of the technology. So we do that, but then when the alarm goes off, we actually grab video, 10 seconds each side of the alarm event and stream that to a website.

So the loss prevention people can review it afterwards. We give them so much data, we tell them when the alarms are going off, how frequently they’re going off. We trend them over time.

And if the store enables another technology called RFID, we can actually tell them the exact item that is leaving the store. We can say that’s Gillette razor blades, or that’s a size small blue T-shirt. And we can actually show that item on the screen as it’s exiting the store so that people, the loss prevention personnel in the store know they’re looking for an extra small blue T-shirt leaving the store.

So there’s a lot more we can do than traditional loss prevention providers. And the most significant thing is we give them data so they can act on it, and they can do other things and overlay other security on top of it.

TMH: That does sound extremely handy. And I know back in September that the company updated commercial agreements with large regional liquor store network locations. How has renewing these contracts affected revenue growth? And if you can, what details were added to the contract?

Hall: So, it was with our large regional liquor stores, plus our largest customer in the U.S. We have a thousand-store office supply retailer in the U.S. that’s using our systems. And what we found when we first established the agreements with them and with our liquor store network is, we kind of knew how media was evolving at the time, but we didn’t expect how rapidly retail media has exploded.

And retail media, if you check out what’s going on within digital advertising today, the bulk of anything new is happening in retail. And it’s retailers selling advertising on their websites, but also on signage within their stores. And what we’ve decided is we knew enough about the advertising side to be dangerous. We got these systems in there, we were doing OK, but we needed to bring on a media partner, so a large media partner.

And for that we had to restructure the contracts because we needed to be able to, one, assign the media rights to this partner to sell the advertising to all their clients that they already had. But we also wanted more screens within the store.

We wanted (an) immersive experience, not just the screen at the front entrance. We wanted the screen elsewhere within the store. And so with the agreements that we got, we got up to six other screens that we can put elsewhere within the store so that we can sell the whole dwell time of the customer in the store.

And that was the most significant thing, the number of screens in the store and being the exclusive supplier and seller of advertising in the store and getting a six-year contract. So that just happened this summer. So that will pay dividends down the road. As you know, we’ve got a six-year runway now to make money off all of these systems.

TMH: And then, I guess staying on the topic of theft loosely, but I know INEO ORCA, or as I should call it, Organized Retail Crime Alerts, is something relatively new for the company. But how has the AI-driven solution helped change the face of, say, video surveillance when combating theft?

Hall: Loss prevention’s our calling card, that’s what gets us in the front door. And then our business model is really based on the advertising and analytics that go with it. But what retailers are seeing right now is large incidents of organized crime coming at them. Our systems will detect when loss is happening and let them know, but they have to then be able to build cases on it because law enforcement doesn’t want to prosecute just small shoplifting cases.

But if the retailer can build a case to say, we’ve got hit in this store, this store and this store by the same person, then they can build a case against it to get law enforcement involved and they can stop some of these retail crime initiatives. And then if the retail crime people know that these stores are beyond successful, they’ll go elsewhere.

And so, ORCA is our system to be able to automate the analyzing of the video clips. So we capture video of every single loss prevention event, the retailer then can look at those loss prevention events and see within the video certain similarities, whatever.

But you think about doing that as a human over thousands of video clips. It takes us a long time, and sometimes we’re not all that good, but when we do it with machines and we do it with AI, they can pick it out in seconds.

So we can know whether that same store has been hit by the same person five days in a row or they hit a store down the street and then the retailer can, you know, bring their loss prevention teams to bear to be able to actually prosecute and stop this from happening.

TMH: Yeah. Very useful for sure. Especially when you have different employees or management working different days of the week. And I wanted to ask about the distribution agreement with, is it pronounced Prosegur Security?

Hall: That’s it, yes.

TMH: OK. For Jumbo in Colombia, I understand there were 59 systems installed at four Jumbo retail locations. So, in terms of facts and numbers, how successful has the technology been at stopping theft over there?

Hall: Prosegur is a big global security firm. Four billion euros in revenue. And they have a loss prevention division that works with retailers, and they have the rights to distribute our product, our INEO Welcoming System. And one of their big customers is a company called Cencosud in South America, a thousand-store retailer with a division in Colombia called Jumbo.

And they’ve put our systems into now four locations. It sounds like a small number of locations, but they’ve actually put in 59 systems in those locations.

And it’s amazing what those systems go in and do. Like the amount of intelligence that we give that retailer from the get-go: They do not know the number of times things are being stolen in a day; they don’t know when they’re happening. We put that in there.

It allows them to overlay other things like guarding services. We know between 5 and 9 o’clock at night that we’re getting hit in this store this time, let’s position the security guard at the front door and stop that, and they can do the cost benefit analysis of the cost of the security guard for the amount of theft that they’re stopping, right?

And our systems allow them to do things like that. So, it’s been a great relationship with Prosegur. They really pushed our systems out there to a lot of other locations and we’ll see the benefits of that down the road in terms of revenue.

TMH: And I think I know what you might say to this one, but I have to ask because I want to hear it from you. What about INEO Solutions makes the company a solid investment for investors’ portfolios?

Hall: We’ve found out kind of the secret sauce to getting digital signage into retailers. We talk about loss prevention and we’re very good at loss prevention, but in the end it’s, we want digital signage within the retailer so we can take advantage of this huge trend in retail media and the amount of dollars going into the stores.

And so, getting our systems in the front door and getting the pickup from the retailer, we’re seeing that happen. You know, the large customer in the U.S., the liquor store network here, we’ve got trials now seeded out there elsewhere, pilot systems in a large number of retailers. So now we just have to get those to a full contract.

And that’s what you’ll see over the next year is we’ve been able to get a few over the line, the testing’s happening with the others. They believe that this small Vancouver company has what we say we have, and we can showcase that we’re going to do what we say we’re going to do. And now we’ll move those to full contract and that will change the profile of INEO a lot in the next 12 months.

TMH: And is there anything the company hopes to accomplish that maybe you haven’t said, or you want to kind of re-highlight for us?

Hall: The one thing that we’ve said we’re going to accomplish that we haven’t announced yet, is a media partner. So, we restructured all those contracts with our retailers because we need to bring in a media partner to really monetize the systems to the full value capabilities of the systems and that fill the screens with advertising.

And that’s where recurring revenue’s coming from, right? As soon as we have the screens going and filled with advertising, the revenues start flowing in. But we need a media partner to do that. And we’ve been in talks with quite a few, really narrowed it down now and we’re close.

So, I’d say that’s what investors should look for for a catalyst moment. Watch for us to announce who we’re going to partner with on the media side.

TMH: Well, we will watch out for that. And thanks again, Kyle. Always a pleasure.

Hall: Great. Thanks for having me.

Go to to find out more about INEO Tech solutions, or you can find them on the TSXV, under the ticker symbol V.INEO.

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