Latest / The Retail Podcast / AI: Retail’s New Operating System with TCS VP Abhijit Niyogi

Transcript

AI: Retail’s New Operating System with TCS VP Abhijit Niyogi · The Retail Podcast

• 0:00
  So now maximum talking point is happening, how we can really use
• 0:04
  the AI, how we can really use the gene AI, how we can adopt
• 0:07
  that particular process. So with that, buzz will be
• 0:09
  there, but definitely sustainability is one of the
• 0:11
  important factors. Hello and welcome to the Retail
• 0:25
  podcast. We're going to have a deep dive
• 0:27
  with one of the leaders in retail in helping retailers
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  achieve their outcomes. I'm fortunate enough by to be
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  joined by Bhavajit Niyogi from TCS who's Vice President for
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  retail across UK, EMEA and India.
• 0:43
  So why don't you tell us, why don't we start with, as always,
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  tell us what you do, how is your, what your focus area is.
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  And then right now, because obviously being Vice President,
• 0:55
  you must meet so many retailers. What's top of mind for 2025?
• 1:00
  Absolutely. Thanks Alex and thanks for
• 1:02
  giving me this opportunity to you know participate in your
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  podcast. I've been in TCS for last 30
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  years is a quite long journey and spend over you know 15 years
• 1:12
  in the States. Then in last 10 years, I am
• 1:14
  based out of London, almost last 12 years I have been involving
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  in the retail in various different roads.
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  Specifically right now I look up the overall business of the
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  retail as you said in the UK, Europe and EMEA in that
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  particular market including the India geography, so which is a
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  quite diverse geography. And definitely I meet as per my
• 1:36
  role various different CXO and I go and attend and meet the
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  customer. And as you know that shift in
• 1:43
  the retail pre pandemic and there's a post pandemic era,
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  right. So pre pandemic used to be quite
• 1:49
  different than what we see in the post pandemic.
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  But what I am right now, now seeing since, you know, in the
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  beginning of 2024, probably initially we thought after when
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  we came out of pandemic that maybe online will take a big
• 2:02
  leap in terms of the, you know, retail and the store brick and
• 2:06
  mortar format will probably shrink down.
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  But surprisingly, it actually came back quite heavily.
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  You know, at the start of 2024, the brick and mortar shopping
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  again quite heavily. It it came out OK.
• 2:18
  And now I'm seeing every retailers, they are spending
• 2:21
  huge amount of money in terms of the store transformation.
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  So there's a huge close transformation is happening
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  across the board, whether whether mainly in terms of the
• 2:29
  pricing, promotions, availability, in terms of
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  merchandising, putting the right things into the right place and
• 2:37
  more importantly, the customer experience, because customer
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  experience is one of the key important factor.
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  And it is ever changing because even if I compare myself when I
• 2:46
  and my, you know, kids who are going and shopping, whether be
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  it online or in store, the perspective of that out outlook
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  of the customer, you know, is quite dramatically changing and
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  shifting. So I think 2025 every retailer
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  is having the biggest focus, how they can adopt that change in
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  nature and how they are in a much more agile in terms of
• 3:10
  making those changes. Because you can't have a two
• 3:13
  year transformation strategy and by the end of you will see maybe
• 3:17
  a year one in your transformation.
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  Things got changed, right? So we don't have that luxury
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  anymore that OK, we launch a big transmission programme.
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  So 2025 and probably beyond the next three years, people are
• 3:28
  looking for how we can be much more faster doing these changes,
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  whether it be it in a supply chain, whether it be it in
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  merchandising, whether it's pricing, promotion, customer
• 3:37
  loyalty, anything that OK, you can name it.
• 3:40
  So adopting that change is what is going to drive the strategy.
• 3:44
  Yeah. Well, I mean just picking up on
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  a couple of themes that you've you've spoken about there in
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  terms of pricing pressure and value driven commerce.
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  Obviously inflation has a had a massive impact on the consumer
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  and on retailers. I was just curious if you had
• 4:01
  seen examples of how brands are using advanced pricing and agile
• 4:05
  supply chains to sort of get the right balance between
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  competitive pricing and profitability?
• 4:12
  Yeah. So if we look at you take the
• 4:16
  food, groceries retailers, right, So they operate in very
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  thin margin, right. So if they are not super
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  efficient in terms of their supply chain and with the
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  pressure of all this geopolitical pressure, you have
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  seen the war situation in the Europe and and and inflation was
• 4:30
  quite high even though right now it tapered down.
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  But last 2-3 years, people really focused in terms of the
• 4:37
  improving their operational efficiency to the supply chain,
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  whether if you have an end to end visibility start right from
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  you're sourcing to you're putting into the stores, there's
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  a huge improvement areas are there for for every retailers
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  matter of fact, right. So every retailers spend right
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  now quite a bit of money in last 2-3 years and continuously
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  evolving with the AI, with the different technologies and it
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  has to be super efficient. And that helps driving their
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  cost down, which will help them for at least the commodity of
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  the goods who have a reasonable price for the people and the
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  consumer. So that's one part, part of the
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  you know process, which is which, which was you know there
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  earlier as well. But it is more important right
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  now that you have to operate into your supply chain process
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  in a much more efficient manner. The second thing which also and
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  and you touched upon is the pricing efficiency and the and,
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  and what level of the right price or the right time that you
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  can push it to your, your, you know, shelf, right.
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  So it has multiple different components in just in a very
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  high level. Are you pricing at the right
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  point based on your localization, based on your
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  availability, based on your market completeness in other
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  dense region? And that intelligence and the
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  dynamic pricing, what we call it is, is very, very important.
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  And that is where a lot of technology, a lot of algorithm,
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  a lot of innovations are happening to have the you using
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  your data set, using your, you know, Geo, you know, landscape,
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  using your customer demographics, using your need of
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  the supply chain. Can you really have that pricing
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  at the right price point now? Then the third component is you
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  may have the price point right. Can I push that price right now
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  in a much more seamless manner to the to each of the shelf,
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  right? Earlier in old days used to be
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  like you do a big thick paper process and then you send it to
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  the store and they'll go to the level and then they will change
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  it, right? So right now those things got
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  completely changed and that is where the digital innovations
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  are happening with the electronic shopping level or
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  other things so that you can just push your pricing, you know
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  then and there. So these are the whole different
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  areas in in three or four different segments.
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  That is what is happening. Okay.
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  I'm just curious in terms of your experience of help trying
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  to help retailers with that, what what do you think are some
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  of the what, what good examples have you seen of this?
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  Are still are people still building it?
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  Yeah, I should say that, yeah, some retailers already adopted
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  the process, whoever started this journey probably three to
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  four years back and some retailers you know in the
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  process of doing it, OK, So they are a little bit doing a cost
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  benefit analysis for a very good example.
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  Like if you go to you know Germany and if you go to the,
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  you know, biggest retailer there, they have already adopted
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  the ESL process. OK, So if I exited just in the
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  Nordics, yes, some retailers already adopted.
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  If you go to the US also, yeah, probably a lot of retailers
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  adopted that. So the adoption process, what
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  you see like it obviously depends on your strategy and the
• 7:33
  business strategy and what the ROI that you wanted to make it,
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  right. And if some retailers, they may
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  not feel that their price change is so dynamic.
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  So the things are where the ESL will work.
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  Just for an example, I'm telling you where you feel that way.
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  You need to change your price quite frequently so that you can
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  get advantage of it, right? The competitive advantage.
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  But in contrary to that where you think that your price is
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  more or less constant in a week time, OK, and you don't need
• 7:59
  that advantage or the price advantage is there, then you may
• 8:02
  not implement those, you know, digital shelf level, right?
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  So these are the different use cases based on which I think, I
• 8:09
  think retailers are doing, but finding out the right price and
• 8:13
  the price optimization is every retailer they need it, okay.
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  So it doesn't matter whether it's a small retailer versus
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  large retailer, whether groceries versus Apple versus
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  electronics, everyone need that right pricing and the strategy.
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  I think that is where we are helping as Atcs, we have some
• 8:30
  unique, you know, capability in the product, which is working
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  well and quite a lot of customers are having that
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  traction in terms of do we have the right, because everyone is
• 8:39
  having data, right. So everyone is having lots of
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  data. Are we using the right data at
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  the right time to come up with the right price.
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  So that's where I think the the fun is there that OK, how we can
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  use technology, how we can use algorithms, how we can use AI
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  driven, you know, technologies to really come up with those
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  price intelligent pricing, what we call it.
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  How are CMOS seeing ROI from influencer LED retail
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  strategies? I mean, is that something that
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  you can help or you're observing with the CMO part or the
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  marketing part of the business? Yeah, absolutely.
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  I think see there's a traditional term is the retail
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  media network. I'm sure that, you know, a lot
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  of people are interested in it. A lot of retailers are using
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  that Ottoman as one of their, you know kind of strategy and
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  they can, you know, definitely create a good campaign out of
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  it. But obviously the Zenzi kind of
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  category were influenced by as you said rightly, that of the
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  word influenced by several different of this push and
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  pricing and, and how how how the sentiment even others, right.
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  So how you can even look at socially that OK, how it is
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  happening, right. So connecting those different
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  bits and pieces, people are trying, but I have not seen
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  these at the enterprise level in every retailers across the board
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  by the way. But obviously that is one of the
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  area which some of the CMOS are thinking.
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  Some of the large retailers are using it, but it is not in
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  general that every retailer is having that.
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  Strategy. Yeah, I yeah, there's a couple
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  of things obviously from past experience that I see with
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  demand pricing or, you know, elastic pricing.
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  How can you deliver on that if you need free prices during the
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  day, but you don't have electric shelf labels or you're you're
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  dependent on staff to manually go and reprice things?
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  But anyway, that's a conversation for another day.
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  In terms of Omni channel and fulfilment innovation, when we
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  look at retailers redesigning store layouts to be sort of mini
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  fulfilment sensors, how is transforming the customer
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  experience and what role does AI analytics play in fulfilment
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  sort of seamlessly across digital and physical touch?
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  Yeah, I think I think differently that is one of the
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  area a lot of innovation and inventions are going on, right.
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  So true Omni channel experience every retailer wanted to
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  implement and in that, yeah, people are buying online, you
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  know shipping from store or you can buy online, pick up from
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  store. So all those different
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  transformation is going on. And, and if you look at at least
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  even in the UK market, I've seen in the Middle East as well, they
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  are really changing the store layout.
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  If you walk in the store and you have to have a seamless
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  experience, not only just for your shopping experience, but
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  also your checkout experience. You have seen that, OK, how the
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  how the checkout is really doing the evolution, right?
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  So what the traditional, you know, till checkout versus sales
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  checkout versus walk out, walk in, walk out, those type of
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  checkouts and, and you can pick up, you know, that particular
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  part in a seamless manner. I think I think various
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  different, you know, to do that efficiently.
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  There are two three again things in you know, why we are helping.
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  One is obviously you need to have a true Omni channel channel
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  experience in terms of your order fulfilment, right?
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  So order it has to be seamless integration between your
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  whatever back end system that will be used so that the
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  information are readily available.
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  And that is where the AI and the data-driven analytics is
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  helping. And then when you walk in in the
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  store it also sometimes you know I have seen not probably in the
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  apparel, but any other sector in the home improvement area.
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  You may have bought say 5 items you went to the store and you
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  wanted to pick up explore colleagues also come to you.
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  By the way you forgot. I know that if you place this
• 12:13
  particular order and you may need you these two additional
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  items for you to probably what you are buying.
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  OK. So you can even top up your
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  basket, you can add few items seamlessly and you can give that
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  particular experience back to the customer.
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  I think that is really customers is a wow factor that they are
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  getting it. Now in order to do that you ask
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  them how the technology is helping.
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  So that is where I think the technology is helping immensely
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  and that insight of your actual personal driven experience is
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  what is the aim. So the personalization is one of
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  the big factor, you know, in the retail, right.
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  So can I really go into the personalization when you walk in
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  the store or even you do online shopping so that you have that
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  seamless experience, Who am I when I'm doing the shopping,
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  right. So that is where the lot of
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  innovation is going on and the technology is really technology
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  is really helping there. I got a final question.
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  Sustainability is a competitive advantage obviously in Europe.
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  Obviously the the US and Europe very different in their approach
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  to sustainability. And we've just seen from the new
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  leader what what they're what they're doing over there.
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  But consumers specifically within this market are demanding
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  greater sustainability in retail.
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  How are brands integrating circular circular economy
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  principles or green logistics or eco friendly products into their
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  business models? And do you think regulatory
• 13:38
  pressure will, will, will will change or speed this up?
• 13:41
  Yeah, absolutely. See, if I compare obviously
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  three different market, I'm seeing it.
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  Europe is, you know, way ahead right now, right?
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  So absolutely, you know, they, they adopted the process, their
• 13:52
  ESG standard. Some retailers are really proud
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  about if you go to the Nordics, you know, they have the circle,
• 13:58
  you know, whole whole concept. They started 2-3 years back and
• 14:02
  they adopted it. And, and in fact, if you look at
• 14:05
  it, the Zenzi, you know, category, they are very much,
• 14:08
  you know, what we call is a conscious about what they buy,
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  right. So they are also looking at it,
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  are these products really, you know, kind of made-up from the
• 14:15
  sustainable goods. OK.
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  Is there is there way that OK that I can contribute also to
• 14:21
  that particular cost? So there's a lot of focuses
• 14:23
  there in the Europe and obviously there are a lot of
• 14:25
  regulations are there OK, which I'm sure that you know, things
• 14:29
  as you know, people will fall into the place in UK also
• 14:33
  there's a good, you know, kind of measure is there in terms of,
• 14:36
  you know, using the sustainable sourcing of the product.
• 14:39
  It they declared that part of the sustainable product and
• 14:43
  people I'm seeing that people are buying that even if that
• 14:46
  increase your price point in overall matter of the game,
• 14:50
  right? So it is actually people are
• 14:53
  adopting that particular process.
• 14:54
  Obviously in other market is little different, as you said,
• 14:58
  OK, so we'll we'll we'll watch and see.
• 15:00
  But sustainable retailing is one of the big focus is there.
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  It was actually the boardroom topic last one year.
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  I have not seen so much in the boardroom topic for the
• 15:09
  sustainability in an honest manner, but as because maybe
• 15:12
  that they have already adopted the process and it is BAU, right
• 15:15
  And or maybe in certain, you know, geography, it may not be
• 15:18
  that much pressure from a regulation probably is driving,
• 15:21
  right. So now maximum talking point is
• 15:23
  happening, how we can really use the AI, how we can really use
• 15:27
  the GENII, how we can adopt that particular process.
• 15:29
  Probably that buzz will be there, but definitely
• 15:32
  sustainability is one of the important factor.
• 15:34
  Fantastic Abhijit. Thank you so much for giving up
• 15:36
  your time, the side of the world.
• 15:39
  I look forward to maybe seeing you at one of the conferences in
• 15:42
  the UK or in globally, but thank you.
• 15:46
  Thanks, Alex. Thanks.
• 15:47
  Thanks for your time as well. Thank you.