With digitalisation disrupting shopping patterns, retail companies are looking at newer ways to sustain their customer base. Tesco’s operations in India aims to drive a culture of innovation to make the shopping experience better for customers. Tesco Bengaluru is the only retail and technology centre worldwide for the British multinational grocery and general merchandise retailer. Sumit Mitra, CEO, Tesco Bengaluru, shares his views on the role of Tesco’s India centre and how retail technology is shaping the industry landscape, in a recent interaction with Sudhir Chowdhary. Excerpts:
What are some of the innovations that are driven out of Tesco Bengaluru to support Tesco’s global operations?
At Tesco Bengaluru, we believe in driving a culture of innovation and encourage our colleagues to drive innovation every day. This means providing them the ecosystem and means to carry out innovation to continue serving our shoppers a little better every day. There are many innovations our teams have been driving out of our Bengaluru office in collaboration with teams in the UK. One of these is predictive maintenance, wherein our property services team is on the verge of loading preventive maintenance for 4 lakh assets that will drive the workload plan of our 1,200 field team colleagues and contractors. Our technology teams have developed a new generation fulfilment optimisation platform by the name ‘BumbleBee’, which leverages artificial intelligence (AI) and data science to optimise delivery truck movement through the shortest routes. Other than that, our teams have also worked on a virtual reality (VR) 3D mapping system for stores. The virtual reality helps us visualise our store layout and make changes before implementing it, thus saving money, time and mitigating risks. It also helps our colleagues to virtually experience different sections of our stores that helps them in building more effective solutions.
Where do you see India feature vis-à-vis other global retail markets as far as adoption of new technologies is concerned?
The Indian retail market, particularly the food and grocery segment, has seen investments from several leading international players who are keen on leveraging their expertise in world-class food services and retail technology. The application of new technologies in Indian retail has seen greater uptake to meet ever-changing consumer expectations. Much of the experimentation seen so far is done over delivery platforms. Retailers are usually chasing flexibility and control over technology, leading them to use cloud. While visual search and image recognition is being adopted to help customers find the right product and reduce returns, apparel sellers have also begun to invest in AI to offer an enhanced shopping experience.
Having effective omni-channel technology is critical when it comes to maintaining customer satisfaction. What can retailers do to address this anomaly from a technology perspective?
Tesco has continually been investing in technology to develop an omni-channel customer experience and to maintain a competitive edge in an increasingly digitised business landscape. At Tesco, we leverage Big Data analytics and algorithms to adapt the supply chain and product offerings to purchase trends, generate personalised discounts and predict future customer purchasing habits. Retailers need to provide seamless customer experience and to do so, they should adapt omni-channel technology solutions. This will enable them to sync legacy and business-critical systems seamlessly by sharing data and logic across all channels. Within the next five years we are also likely to see the integration of Internet of Things (IoT) technologies in the shape of voice-activated digital assistants with a high degree of automation, taking care of purchases through interfaces with retailers’ ordering systems.
What technology trends do you think are likely to impact the retail industry soon?
To be ahead in the digital business era, retailers need to go above and beyond. This requires them to rethink on their existing business model and decide how to transform into digital businesses. This also involves investing in the right technology to become industry leaders. Some technology trends we see retailers increasingly adopt in the future are: Store walk-through using Google Images and changing the way in which interface is done by leveraging VR technology; While there are concerns around privacy and safety, delivering products to customers using drones is something to anticipate in the future; Integrating new age chat interfaces in the shopping environment in a collaborative fashion helps give customers a unified view of shopping lists, thus enhancing the shopping experience; By building blockchain technology in a retail environment using IoT, retailers would be able to identify suppliers, and customers would also be aware of the source of the product. This will bring more transparency as data cannot be tampered in a block and using IoT will ensure that the information given is correct; Leveraging AI will help predict system failures or incidences using past data. AI can also be used to study behavioural and digital footprint of future employees and predict if they will be the right fit; Through IoT, connected devices in kitchens and homes can be used to connect with the nearby retail store to place orders and make purchases.
Digital transformation is the new norm. Do you see any specific challenges and areas of opportunity as a business?
For Tesco, digital transformation began nearly a decade ago. We have been constantly transforming to meet the customer/consumer needs at a very fast pace. We have digitally transformed our customer experience, business model and operating model through investments in a state-of-the-art website with click-and-collect functionality, a digitalised in-store experience and a data-driven customer loyalty platform. With the advent of new technologies and platforms, the challenge is not knowing how to use them optimally. Organisations need to understand that using technologies and applying them in new innovative ways can help produce better business outcomes.