Extraordinary Endeavors in Turbulent Times: Asian Innovation, Inclusion, and Impact during COVID-19

ASIA BUSINESS COUNCIL HONG KONG UNIVERSITY OF SCIENCE AND TECHNOLOGY 6 3 Lotte Group (South Korea) Extraordinary Endeavors in Turbulent Times an eco-system that leverages A.I. platforms and other solutions in information technology. This is particularly true with the sustained shift toward digital consumption during the pandemic, and the team seems intent on meeting this challenge, starting with online fashion. Future Outlook Having said that, fashion is not the only area that Lotte On is focused on. In fact, Choi’s current focus is on something quite different. “COVID-19 has led to a surge in our fresh food and beverage retail business, which grew from 20 percent of sales last year to just under 30 percent this year. In fact, the online grocery market is estimated to grow almost 40 percent year-on-year in 2020,” Choi said. “But online sales penetration in the food category is still under 25 percent, even after COVID-19. This compares to the average penetration of 37 percent for online retail sales in general in South Korea, which is also among the highest in the world. The fresh food category thus offers exceptionally high growth potential,” she continued. Indeed, the “untact economy” is a popular term in South Korea, where the word “untact” comes from a combination of the prefix “un” with the word “contact.” The concept is that of a contact-free economy. As consumers prefer to eat at home and minimize their trips to the market in light of the virus situation, Lotte On appears keen to leverage on its existing supply chains and delivery services to offer “untact” solutions. According to Choi, Lotte On ran a pilot test for the delivery of groceries within two hours and will expand this service, where products are sent through an automated Lotte Auto Fresh Center is an automated logistics center equipped with 19 robots