Lotte Shopping Advances AI... "Providing Hyper-Personalized Customer Experience"

Upstage Signs 'Generative AI MOU'
Utilizing Customer Purchase Data to Deliver Hyper-Personalized Customer Experience
Retail Tech, Fostering Innovation Growth Engine in Distribution Sector

Lotte Shopping is introducing generative artificial intelligence (AI) to deliver a differentiated shopping experience to customers.

Sanghyun Kim, Chief Executive Officer (Vice Chairman) of Lotte Shopping
Photo by Lotte Shopping.

On the 12th, Lotte Shopping announced that it will sign a 'Generative AI Mutual Business Agreement (MOU)' with the global AI company Upstage. The signing ceremony will take place at Lotte World Tower in Songpa-gu, Seoul, with Kim Sang-hyun, Vice Chairman and CEO of Lotte Shopping, and Kim Sung-hoon, CEO of Upstage, in attendance.

Through this business agreement, Lotte Shopping and Upstage plan to mutually cooperate in developing new services using generative AI and AI specialized for distribution. Lotte Shopping will support business model development and operations using its internal infrastructure, while Upstage will provide technical consulting and services related to generative AI.

Lotte Shopping aims to sequentially introduce various services utilizing Upstage’s generative AI and, in the mid to long term, develop its own generative AI specialized for the distribution industry. By combining Lotte Shopping’s online and offline distribution experience and customer purchase data with Upstage’s AI technology, they plan to develop services such as personalized marketing and AI-based customer consultation. In line with the recent trend of 'hyper-personalization,' they intend to provide differentiated customer experiences that satisfy customers’ segmented interests and preferences. They also plan to develop an AI-driven demand forecasting-based automatic ordering system to enhance the efficiency of distribution processes within Lotte Shopping.

Starting with the MOU signing with Upstage, Lotte Shopping plans to pursue a distribution-specialized generative AI strategy through discovering related partners and promoting various projects.

Meanwhile, Upstage is an internationally recognized AI specialist company, and its self-developed generative AI is evaluated to have world-class performance. Recently, it gained attention domestically by developing 'Asukup,' a ChatGPT version for KakaoTalk. Lotte Shopping is already collaborating with Upstage through Lotte ON. In June, Lotte ON introduced a personalized AI product recommendation service developed through a two-year collaboration with Upstage. After implementing the product recommendation AI, Lotte ON’s purchase conversion rate increased by 30% compared to the test conducted in January, and both companies continue to cooperate to further improve this.

Vice Chairman Kim said, "Through this agreement with Upstage, we will provide differentiated services and customer experiences unique to Lotte Shopping," adding, "We will actively promote the generative AI strategy and foster retail tech as a key growth engine for innovation."

This content was produced with the assistance of AI translation services.