South Korea‘s largest retailers are looking to incorporate digital technology into their shopping experiences, inject storytelling elements into their content and expand overseas in 2018.
In his New Year’s address, Lotte Group Chairman Shin Dong-bin stressed the importance of adopting a “digital transformation” in processes across the entire group. In the retail sector, Lotte has already begun adopting artificial intelligence to its shopping experiences in partnership with IBM.
Last month, Lotte Department Store debuted Losa, an artificial intelligence chatbot that consumers can use on their mobile devices to receive recommendations on products based on big data. As consumers spend more time chatting with Losa, the chatbot learns about each consumer‘s preferences to find customized product lists.
Internally, Lotte Confectionery has also used artificial intelligence to come up with a new product in its Pepero line. Using IBM software, the company analyzed the latest trends in confectioneries to come up with two new flavors -- Pepero Kakao Nibs and Pepero Calamansi Yogurt.
Further incorporating technology will “improve productivity and identify new growth engines that break with existing knowledge and concepts,” Shin said in his address.
Retail giant Shinsegae, meanwhile, will be focusing on storytelling elements in its 2018 strategy.
“We must connect all of our content including products, stores and brands with stories to mold them according to our customers’ needs,” Shinsegae Group Vice Chairman Chung Yong-jin said in his New Year‘s address.
Noting companies such as Disney and Nike as benchmark models, Chung said that “content with stories is a powerful weapon that will fundamentally differentiate us from our competitors and draw in consumers through emotion,” Chung said.
Shinsegae Vice Chairman Chung Yong-jin (left) and Lotte Group Chairman Shin Dong-bin (Shinsegae, Lotte)
Last year, Shinsegae made moves towards this type of storytelling retail, opening up the second branch of its theme-park style shopping mall Starfield in Goyang and strengthening marketing of Electromart, an electronics specialty store that uses a comic superhero character to communicate with consumers.
In the food sector, companies will be seeking to expand markets overseas. CJ CheilJedang, which is currently exporting to countries such as the US and China, is planning to expand its production centers to Russia, Germany and Vietnam. Recently, CJ CheilJedang acquired an additional stake in CJ Group’s logistics company CJ Logistics, allowing the food company to use the logistics company‘s global network in the future.
“We must use our strength in domestic business to aggressively expand our business in the global market to speed growth,” CJ Group Chairman Sohn Kyung-Shik said in his New Year’s address. “In countries where we have already entered the market, we must focus on producing results, and actively pursue expansion into new and emerging markets.”
Food group SPC is also looking across borders in the new year.
“To accelerate our global business, we must create a virtuous cycle in which growth in our existing businesses leads to the discovery of new markets,” said Hur Young-in, SPC‘s chairman.
As of last year, SPC’s bakery chain Paris Baguette had 311 stores overseas in China, the US, Vietnam, Singapore and France.
By Won Ho-jung (email@example.com