With the launch of its 200th store in Egypt and the first-ever all-female store that opened in Jeddah, Lulu has been achieving multiple milestones this year. Spanning across 10 countries, the company has been a true example of a UAE-based organization going global. Group CIO Piyush Kumar Chowhan shares insights on the company’s digital shift, data strategy and more.
2020 has definitely been a chaotic year, especially for food retailers who had to deal with sudden surge in demand moving online, the massive transition coming from panic buying etc. can you quickly take us through how 2020 has been for you and how you dealt with it?
I think the word chaotic is an understatement to what we have seen in 2020. And I think it has been a remarkable year for everyone, right from food detail on food and everyone out there. And we have seen multiple things happening. The first thing is, the transition of the consumer behavior has been so vast and so fast that it has been difficult for a lot of retailers to catch up with that change. It is a no-brainer that e-commerce became much more prominent, safety became much more prominent, trust became much more prominent. The second important change that we are seeing the move towards discretionary to more essential. The amount of spending on discretionary items is kind of coming down.
What has happened post COVID is digital transformation journeys, which retailers are already on, is accelerated. So for example, we believe that the targets of digital transformation which we had planned for 2025, we are kind of bringing that back at least two years ahead. We believe that the customer behavior change and the other change that we talked about, we’ll be able to transition some of our digital spend in those directions, and we’ll be able to achieve some of the targets much earlier than what we would have if COVID was not there.
How you are leveraging data and AI, especially in the supermarket sphere?
Data is is the new soil, which means that you have to have your digital transformation journey built on this soil, which is the digital enabled, that you are trying to build in and put it on your organization, you need to make sure that you are nurturing those processes, technologies and transformation strategies on this lever of data. And obviously, AI, ML and analytics have been there for quite a while. The last decade has been around using a lot of data analytics tools, a lot of data platforms, a lot of AI platforms, and so on so forth. And what we were seeing is that some of the actual benefit of these were not reaching the end consumer because people were not nurturing data as much as they would need.
And when COVID came, I think a lot of retailers realize that the only way to differentiate yourself from your competition is to have a lot of understanding of your customer data, supply chain data, and the behavior of those customers so that you can personalize and target them better. The more you analyze that data, the more we are able to engage with the customer better. One bad experience to a digital shopper is actually kind of creating a great sense of disloyalty towards that brand, which becomes very difficult to break.
Many retailers are still using age-old loyalty schemes and programmes like cards with points that are redeemable at the end of the customer’s shopping journey. Do you think retailers are yet to get loyalty right?
I think what you’re referring to is maybe a few years back retailers predominantly had their so-called point based loyalty schemes. It is becoming very evident that is a loyalty of the past century, not even this decade. And as we move along more and more retailers, including Lulu, we’ve always believed that it had never been a big sticking driver for people to come and shop saying that, if I give you one point for every 100 you spend. If you forgive me a wonderful experience where the retailer looks at the customer’s personal customer behavior and once you walk into my store, I can say that here is a car wash coupon here is a premium parking that I gave you. And so what is happening is that loyalty as a paradigm is shifting from transactional loyalty as as it was in the past to experiential loyalty.
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