Retail Industry Meets AI, Becoming a Hub of Change and Innovation

KCCI to Host
‘AI Utilization Strategy Seminar for Distribution and Logistics’ at KCCI Hall on the 22nd

Seoul Jung-gu Korea Chamber of Commerce and Industry. / Photo by Jinhyung Kang aymsdream@

"As AI (artificial intelligence) technology expands its influence in the distribution industry, it is argued that the distribution sector will become the epicenter of AI-driven disruptive innovation."

The Korea Chamber of Commerce and Industry announced on the 22nd that it held a 'Distribution and Logistics AI Utilization Strategy Seminar' at the Chamber of Commerce building. This seminar was organized to explore the challenges and opportunities AI brings to the distribution and logistics industry at a time when preparation for new technologies is necessary in the AI era. About 400 distribution and logistics industry workers gathered for the event, making it a great success.

Professor Jang Jung-ho from Seoul School of Integrated Sciences and Technologies, who delivered the keynote speech, emphasized, "Because AI is an innovative technology that can immediately change our lives, the distribution industry, which is deeply connected to our daily lives, will be the very place where significant changes and disruptive innovation occur."

Professor Jang continued, "Until now, AI technology has remained at the level of improving tasks and increasing efficiency, but in the future, innovative unmanned stores and unmanned shelves based on AI will create new distribution formats where consumers and producers meet directly," adding, "AI will bring transformation across all areas from customer service to logistics."

Jeon Yong-jun, CEO of Revision Consulting, stated, "With the use of generative AI, it has become possible to produce results at levels previously unimaginable, and distribution industry leaders are now accepting AI as a reality rather than a bubble," and analyzed, "Since generative AI technology itself is shared by everyone, the key to competitiveness will be how and to which tasks the same technology and its combinations are applied."

Kim Gye-sook, CEO of Winning Pricing, said, "After investigating 249 AI projects, it was found that AI strategies linked to corporate goals and clear business objectives are the most important success factors for AI projects, rather than data acquisition or AI capability levels," emphasizing, "The purpose of how a company solves problems should be prioritized over data acquisition or AI capability levels."

Innovative cases in marketing, product development, and logistics through AI were also introduced.

Kim Yoon-kyung, CEO of Fandom Funnel, emphasized, "In the distribution market where consumer behavior is constantly changing, marketing using AI is becoming a solution to maintain competitiveness and achieve growth," adding, "By improving interactions with customers through AI, it is possible to discover and target new customer segments and explore new markets, as well as enable rapid analysis and prediction." Kim cited examples such as Hyundai Department Store's AI new employee ‘Luis’ and Lotte Home Shopping's virtual human and Naver Store's AI-based recommendation model.

Luis (Hyundai Department Store) is an AI responsible for marketing copywriting, capable of creating appropriate marketing messages by learning from past advertising copies that received good customer responses and successful case data, significantly reducing the task time from over two weeks to 3-4 hours. Naver Store's AI-based recommendation model provides personalized customized services by presenting recommendation reasons such as 'This is the product you viewed 3 days ago' when users who have previously clicked, added to cart, wishlisted, or purchased search for products again.

Winning Pricing CEO Kim Gye-sook claimed, "Generative AI technology enables easy and fast product design and prototype creation, increasing the speed and success potential of new product development." She also introduced dynamic pricing cases of Amazon and Coupang, which secure profits and competitiveness even in an era of high inflation through AI-based dynamic pricing strategies that adjust prices in real time according to circumstances.

In fact, Amazon uses a 'dynamic pricing strategy' that flexibly changes product and service prices without fixed amounts, monitoring competitors' selling prices for the same products in real time and adjusting prices frequently. Coupang also monitors online shopping mall prices 24 hours a day, adjusting prices to be equal to or lower than other malls, implementing a lowest-price policy.

Kim Min-su, Executive Director of CJ Logistics, explained, "Behind the e-commerce market that has more than doubled in the past five years is an innovative AI-based fulfillment service that efficiently integrates the entire process from order to delivery, including order volume forecasting, warehouse management, and delivery network optimization," adding, "Our company's 'The Unban' service, which directly connects cargo owners and carriers to reduce logistics costs, also relies heavily on AI for real-time freight pricing and optimal matching."

Coupang's Daegu Fulfillment Center, one of the largest logistics centers in Asia, is a concentration of AI-based automation innovation technology in logistics. AI technology is applied from product display to picking, packing, and sorting, and unmanned guided vehicles (AGVs) and sorting bots manage products and assist employees in this smart logistics center.

Jang Geun-moo, Director of the Korea Chamber of Commerce and Industry Distribution and Logistics Promotion Institute, said, "AI can provide value such as cost reduction, process efficiency, profit maximization, and customer satisfaction, and cases of strengthening corporate competitiveness through AI are increasing across various industries," adding, "In the digital distribution and logistics era, companies that utilize AI well and those that do not will show stark differences over time."

Furthermore, Director Jang stated, "The Korea Chamber of Commerce and Industry Distribution and Logistics Promotion Institute plans to create an environment where AI can learn by supporting individual product data such as raw materials, weight, and product images accumulated in the distribution product standard database it has built, and to develop AI utilization models that combine heterogeneous information such as sales and purchase reviews."

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