Lotte drives industry change with AI integration, new growth themes

Guest Reports

Lotte drives industry change with AI integration, new growth themes

Published: 31 Jul. 2024, 14:05 Updated: 31 Jul. 2024, 15:25

Lotte is looking toward more industry innovation with the proactive adoption of AI across the group’s array of businesses.

The intent is to go beyond enhancing efficiency to strengthen corporate competitive advantage. Moreover, Lotte is preparing for the future with a portfolio shift centered on four themes for novel growth: “Bio-Wellness,” “Mobility,” “Sustainability” and “New-life Platform”.

Delivering differentiated values

Following the request of Lotte Group Chairman Shin Dong-bin to “consider AI as a tool to strengthen our core competency from an innovative perspective,” Lotte is actively taking part in the shift toward AI.

Lotte’s Retail sector is applying multifaceted uses of AI for “retail innovation”. As AI is being incorporated into overall tasks, even more AI solutions are to be introduced in the latter half of the year.

Lotte Department Store is increasing task efficiency using AI. A chatbot based on Lotte’s in-house AI Platform, “Aimember,” is used for employees to task search with greater efficiency, and the company collaboration tool is also mounted with Aimember’s ChatGPT function.

Moreover, Lotte Department Store is actively applying AI in its designing tasks, recently using generative AI to create the visuals for the “Lotte Wedding Members” service. In April, Lotte Department Store introduced an “AI translation service” for foreign tourists in its Jamshil location, the first to do so among Korean retailers. The real-time service translates 13 languages, including English, Japanese, Chinese and Vietnamese.

Lotte Mart and Lotte Super, the supermarket/hypermarket businesses under Lotte, introduced an “AI Selection System” this year to advance the quality management of fruit produce. In the case of watermelons, the AI Selection System can accurately assess the quality of the inside such as inadequate ripeness or internal splits. For oriental melons, the AI can assess not only size and weight, but also outer flaws such as scratches, deformities or damaging diseases/infections such as Downy mildew or viruses.

In July, it showcased AI-assessed “crunchy” peaches, the first-ever to do so in Korea. The AI Selection System uses “Deep Learning” (technology in which a computer will combine and analyze external data, simulating human thinking) to assess the quality of agricultural produce, further enhancing the objectivity and accuracy of the selection process.

Also utilizing generative AI to more efficiently run their franchises is 7-Eleven. Franchises may access an array of information via the generative AI-based chatbot, “AI-FC (AI Field Coach),” introduced in May, from basic POS system guidelines to placing orders, product details, event descriptions and overall service areas. AI-FC is also available in 7-Eleven’sofficial app, “Seven APP”, as well as the app for managers, enhancing accessibility by allowing users to address questions in a conversational format.

Sustainable growth based on new businesses

Looking to grow in the Bio-Wellness sector, Lotte Biologics held a ground-breaking ceremony for the construction of the Songdo Bio Campus (Plant 1) located in Songdo International City, Incheon.

Lotte Biologics held a ground-breaking ceremony for the Songdo Bio Campus on July 3. [Lotte Group]

Lotte Biologics plans to construct three “mega plants” in Songdo by 2030, and harbor antibody drug facilities with a production capacity of 360,000 liters (95,100 gallons) nationwide. Each plant will have an antibody drug production capacity of 120,000 liters and will include compact Incubators and Drug Product (DP) facilities to produce clinical substances. Lotte Biologics’ policy is to develop a global competitive advantage in biopharmaceutical production with an investment worth 4.6 trillion won ($3.3 billion).

Lotte Biologics’ Bio Plant [Lotte Group]

Lotte Innovate and its subsidiary Evsis, which provides future mobility services, established their U.S. corporate body, “Evsis America,” in May, formalizing their entrance into the EV charging infrastructure market. Production line preparations for the first half of the year are complete, and full-scale business operations will roll out during the latter half.

Furthermore, EVSIS completed the construction of the Cheongju smart factory, equipped with automated facilities. The new factory has doubled production capacity, allowing an approximate yearly production of 200,000 EV charging stations. EVSIS is constructing EV charging station infrastructures in the various businesses under Lotte, including the retail, hotel, service sectors, to expand charging locations to urban areas. Some 4,000 charging stations were constructed and in operation as of last year, and this number plans to grow to 7,500 units by the end of this year.

Among Lotte’s four novel growth themes, “New-Life Platform” is currently focused on the company’s “metaverse” project. In January during the CES 2024, Lotte Innovate unveiled their new subsidiary, Caliverse, and the affiliated metaverse platform of the same name. Caliverse is an ultra-tangible metaverse platform that fuses hyper-realistic visuals with unique interactive technology.

During this year’s CES, it showcased technologies such as “live metaverse technology” which aids real-time communication among users and allows users to easily create content such as User-Generated Content (UGC) in virtual spaces. Caliverse is loaded with world-class VR filming and synthesis technology, rendering technology and high-capacity data compression technology.

BY KIM YEONSOO [kim.yeonsoo1@joongang.co.kr]

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