Tesco aims to boost online sales
Ek-Chai Distribution System Co, the operator of Tesco Lotus hypermarkets, has outlined strategies to serve omnichannel shoppers better.
Due to the growth of mobile internet usage in Thailand, the boundaries between offline and online worlds are become increasingly blurry.
Customer behaviours have shifted towards omnichannel shopping, where they receive information, converse with brands, do their research and finally shop both in brick-and-mortar stores and online, interchangeably, according to Mark Roughley, the company’s online director.
Internet penetration in Thailand in 2017 grew to 67% from 56% in January 2016. Nearly 45 million Thais now access the internet on their mobile phones.
Due to these trends, the customer journey has changed tremendously, and the new retail ecosystem now involves several parties and providers to facilitate the new customer journey and offer more choice, Mr Roughley said.
“We have been witnessing an increasing number of omnichannel customers,” he said. “We know that convenience is key for these customers. And we also know that mobile and innovation is the secret to attracting and connecting with omnichannel customers.”
To cope with this trend, the company continues to enhance its shopping fulfilment by extending more choices in terms of product delivery and shopping platforms.
The customer journey has changed rapidly. The new retail ecosystem is much more sophisticated than the old one, which had only three or four key players, namely product manufacturers, distributors, retailers and customers.
But the new retail ecosystem involves several parties and providers facilitating the new customer journey, from logistics providers to payment providers and price comparison platforms.
“We plan to enhance our services for customers in this new retail environment,” Mr Roughley said. “For example, the company has partnered with Happy Fresh to deliver fresh food to customers in their homes within one hour, or they can choose Tesco’s delivery.”
The retailer has also set a more comprehensive plan geared towards the e-payment system, in line with the government’s national e-payment scheme.
Mr Roughley said Tesco Lotus will focus on providing e-payment channels for customers. The retailer is considering setting its own e-payment system or using those of partners it would recruit.
The launch of the government’s national e-payment system will propel the country’s e-commerce industry and online shopping business. And the company can see that more customers are aware of e-payment.
To prepare for the growing trend, Tesco Lotus is working with payment providers such as Rabbit Line Pay to facilitate mobile payments. The retailer’s e-payment module is expected to start sometime by the end of this year or early next year.
This will support the online business of Tesco Lotus, currently a small portion of total sales. Mr Roughley declined to reveal the sales figures for Tesco, one of Thailand’s leading retailers operating 1,900 branches in all formats, including Tesco Express.
“Online shopping in Thailand grew faster than our network in several countries worldwide,” he said. “We are seeing very strong double-digit growth in our online business since offering it in the past five years, and the growth will be stronger this year.”