Shoplifting has been on the rise according to Gartner research in retail stores in the USA and UK where despite security cameras installed, theft cases continue to rise. Retail stores continue to suffer from theft losses characterized by shoplifting¹ and artificial intelligence is offering timely assistance.

By working with facial recognition technology, artificial intelligence² is using algorithms to determine the behavioral patterns of shoppers in a bid to reduce theft cases. Vaak from Japan is a start-up leading the way where the company recently developed systems run by AI to monitor suspicious attributes among shoppers and alert retail store managers through their smartphones.

While AI is usually envisioned as a smart personal assistant, the technology is accurate at spotting weird behavior. Algorithms³ analyze security-camera footage and alert staff about potential thieves via a smartphone app. The goal is prevention; if the target is approached and asked if they need help, there is a good chance the theft never happens.


Vaak and Third Eye¹⁰ are some new start-ups making news regarding AI for shoplifting prevention and in 2020, more retailers are using their technology to bolster security. Based in London, Third Eye is using AI to prevent instances of shoplifting by coordinating with store owners via instant alerts.

Let us first start with Vaak from Japan, which is making progress in the theft management in the retail sector

Vaak has developed an #artificialintelligence software that can catch shoplifters in the act by alerting staff members, so they can prevent thieves from even leaving the store. Vaak used hours of surveillance data⁴ to train the system to detect suspicious activity using many behavioral aspects, including how people walk, hand movements, facial expressions, and even clothing choices.

Vaak claims that shoplifting losses dropped by 77 percent during a test period in local convenience stores, demonstrating how this technology could help reduce global retail costs from shoplifting, which hit $30 billion 3 years ago. Furthermore, implementing AI-based shoplifting detection technology⁵ would not lead to a significant increase in costs because security cameras, which comprise most of the required hardware, are usually already in place at retail stores.

AI Working with Facial Recognition Technology

Vaak’s technology demonstrates how artificial intelligence can work with facial recognition software, which scans faceprints a code unique to an individual, just like fingerprints.

Unlike fingerprints, faceprints can be scanned from a distance, which opens the possibilities of facial recognition’s applications in fields such as security and law enforcement.

Several local public security bureaus in China have started implementing the use of #augmentedreality glasses⁶, created by the Xloong company, which are able to cross-reference faces against the national database to spot criminals.

Human Behavior and AI Evaluation

The ability to detect and analyze unusual human behavior also has other applications. Vaak is developing a video-based self-checkout system, and wants to use the videos to collect information on how consumers interact with items in the store to help shops display products more effectively.

Beyond retail, Tanaka envisions using the video software in public spaces and train platforms to detect suspicious behavior. Third Eye, has been approached by security management companies looking to leverage their AI technology.

This is not the first time AI has been used to fight retail shrinkage. Last summer, another Japanese company, the communications giant NTT East, launched AI Guardsman, a camera that uses similar technology to analyze shoppers’ body language for signs of possible theft. AI Guardsman’s developers said the camera cut shoplifting by 40 percent.

Taming Losses with Artificial Intelligence

Because it involves security, retailers have asked AI-software suppliers such as Vaak and London-based Third Eye not to disclose their use of the anti-shoplifting systems.

The assumption here is that several major store chains in Japan have deployed the technology. Vaak has been approached by the biggest publicly traded convenience store and drugstore chains in Japan.

Big retailers have already been adopting AI technology to help them do business. Apart from inventory management, delivery optimization and other enterprise needs, AI #algorithms run customer-support #chatbots on websites. Image and video analysis is also being deployed, such as Inc.’s Echo Look, which gives users fashion advice.

The Ethical Questions we need to Ask

There is always an evil side to all technologies especially when it involves Artificial Intelligence, as often criticized. #Technology has always been about adding convenience to and safeguarding human lives, but what it turns in to always depend on who uses it and for what.

AI has always been a favorite subject of critics even for those who are pioneers in the technology. Vaakeye was no less of a target. Many fear that the technology will intrude privacy.

Installing artificial intelligence and facial-recognition software⁸ does raise some questions about the ethics of the technology, especially when it comes to customer consent.

Customers are typically willing to sacrifice some privacy for convenience when they are aware the technology is being used. Most retail stores already post signs about the presence of security cameras, so resolving this concern could be as simple as adding a notice about facial recognition to these signs.

Despite how far science has come, AI does not truly think like a human being just yet. This could lead to a bias in a system’s algorithm. However, just as artificial intelligence can be inadvertently given a bias, it has the potential to be less biased than a human being. This is simply a case of auditing the algorithms to root out any potential bias before training the artificial-intelligence system.

Time to Embrace AI in Retail

Artificial intelligence in retail is not a hypothetical anymore. Today, AI algorithms run inventory management, delivery optimization, and customer-support chatbots on websites, which we are all too familiar with.

When paired with #facialrecognition software, artificial intelligence can even eliminate the need of salespeople, best shown in Amazon’s self-service brick-and-mortar stores that use image and video sensors to shape the customer experience.

With artificial intelligence entering the retail loss prevention sphere, we are going to see great change in how our departments catch shoplifters and combat retail shrinkage.

Works Cited

¹ShopliftingArtificial Intelligence, ³Algorithms, ⁴Surveillance Data, ⁵Shoplifting Detection Technology, ⁶Augmented Reality Glasses, ⁷AI Technology, ⁸Facial-Recognition Software

Companies Cited

Vaak, ¹⁰Third Eye