The rise of the machine and how it helps Scottish small businesses

Some small businesses like record store have seen their sales take off thanks to the internet. Picture: Ian Rutherford

Twenty years ago, the idea that a Dundee record store would be using the internet to sell vinyl to customers in France, Germany and Spain would have been unheard of.

Today, thanks to advancements in technology which help people shop online, the story of Assai Records – who have shipped over 50,000 records to 16 different countries in the past 14 years using Amazon – is typical of the many small businesses reaping the benefits of e-commerce.

Thanks to the digital revolution, small businesses like Assai Records can truly be local and sell global.

The internet and technology are helping level the playing field between small and large businesses. Technology has democratised the ability to start your own business, to the point where now – as long as you have a laptop, an internet connection, and a great product or idea – you can sell that product around the world from anywhere in the world.

One of the key technologies that is enabling this revolution is machine learning – the ability for systems to learn from data without being explicitly programmed.

Breakthroughs in machine learning are powering advances in almost every area of industry and commerce in the world today. You can find machine learning technology in personalised product recommendations for consumers shopping online, autonomous vehicles, drug discovery in healthcare and fraud detection in financial services.

Many of the machine learning technologies that are driving this revolution are being invented here in Scotland.

Edinburgh University is a world leader in computer science, and it is no coincidence that 14 years ago, we chose Edinburgh for our first development centre outside of North America. We thrive in Scotland’s capital because of the talent here and because great technologists from all over the world want to come and live in Edinburgh.

In our Edinburgh development centre, scientists, engineers and designers are harnessing the latest technology to create inventions that help hundreds of millions of customers all over the world.

In Edinburgh, we have applied machine learning technology to improve personalised shopping recommendations, helping customers to discover products, often from SMEs [small and medium sized enterprises] that they would never otherwise have found.

Machine learning is at the heart of our advertising business, which helps brands and sellers to find new customers for their products. We use machine learning to find structure across the billions of items in Amazon’s global catalogue, helping customers to find products by browsing through bibliographies, discographies and series.

Beyond Edinburgh, machine learning powers many of Amazon’s advances for customers, small businesses and content creators – from Alexa our cloud-based voice assistant and Amazon Web Services, through to new innovations like our autonomous Prime Air drone delivery system.

We’re also helping hundreds of Scottish businesses and start-ups through Amazon Marketplace harness the power of machine learning to help grow their revenue, boost their productivity and export through e-commerce.

Many of these businesses have been keen to export, but struggled with translating product descriptions in a simple and low-cost way. To solve this, Amazon helped automate this process to a large extent. While we manually keep checking many translations, we also react to customer feedback, i.e. if they mark a text as “not helpful”. In turn, the computer learns from each correction.

Small businesses are key to Amazon’s success with over half the total units sold through Amazon coming from third party businesses last year. Half of the products in our fulfilment centres in Scotland and across the UK are not owned by us. UK sellers on the Amazon Marketplace achieved an impressive £2.3 billion in exports last year.

Technology has allowed us to create a global infrastructure that’s digital and physical, and develop new inventions that can be accessed in a convenient way by small businesses. For thousands of Scottish firms, they have direct access to hundreds of millions of customers worldwide, can communicate with them in their own language, sell to them in their own currency and have products delivered the same-day or next day delivery across Europe without having to manage any logistics themselves.

And we’re growing right here in Edinburgh. We recently announced space for 250 new jobs at the Amazon Development Centre, with plan to hire managers, scientists, engineers and designers to create the next wave of inventions to help customers and businesses around the world.

l Graeme Smith is managing director of the Amazon Development Centre in Edinburgh