[Asia Economy Reporter Jo In-kyung] Lotte Mart continues its aggressive store renovations (renewals). Riding the wave of recovering consumer sentiment following the phased return to normal life (With Corona), the strategy is to leverage the strengths of offline stores to attract customers back. At the same time, it is investing in facilities to strengthen instant delivery services in response to the continuously growing demand for online grocery shopping.
Betting on Renewal in Commercial Areas Left by Competitors
Lotte Mart announced on the 22nd that it will reopen the Ansan branch in Gyeonggi Province on the 23rd after about two months of full-scale renovation work. The newly renovated Ansan store focuses on implementing a competitive MD (merchandise planning) with the goal of becoming the largest food store in the region. It has enhanced offerings such as low-carbon certified fruits and convenient cut fruits, and expanded the salad zone, which carries products like seaweed salad, to about four times its previous display area.
In particular, the 'Wine & Cheese' store within the Ansan branch features showcases of popular wines and cheeses from around the world, as well as specialized zones for natural wine, bourbon, and whiskey. A separate craft beer zone carries beers from 11 popular domestic breweries, and premium jams, 100% plant-based vegan cheese, and imported ramen?items recently favored by customers?are gathered together.
The health and beauty (H&B) specialty store 'LOHB's Plus' located inside the mart has expanded its product lineup targeting consumers in their 40s and 50s. While the main customers of existing H&B specialty stores are in their 20s and 30s, the main customer base of large marts tends to be older, so anti-aging cosmetics and health supplements have been strengthened accordingly.
With Homeplus Ansan branch closing just 500 meters away on the 12th, marketing efforts to attract former Homeplus customers to Lotte Mart are being intensified. Coupons usable for purchases above a certain amount will be distributed until the end of the year, and offline-exclusive app events such as stamp rallies using the 'Lotte Mart GO' app will also be held. Through these efforts, Ansan branch sales are expected to increase by 50% compared to before the renewal, and the number of L.POINT members at the Ansan branch is projected to grow from 33,000 per month to about 50,000 per month.
Online Orders Delivered Within 2 Hours
Lotte Mart will also launch a 'Baro Delivery' service from mid-January next year through the Ansan branch, delivering online orders anywhere in the Ansan area within two hours. A 'ceiling rail' system that transports customer-ordered products within the shopping space has already been installed, and the store is being converted into a 'smart store' equipped with automated sorting and packaging facilities at the back of the store. This is part of a strategy to utilize offline stores as logistics hubs for future online-offline integration.
Previously, Lotte Mart focused on downsizing by closing 12 stores last year due to prolonged poor performance and the impact of COVID-19. However, this year, instead of closures, it is tightening its grip on improving offline store operations and securing competitiveness through store renewals.
A Lotte Mart official said, "By the end of this year and early next year, in addition to the Ansan branch, we will renovate and reopen stores such as Gwangju Cheomdan, Geoje, Pangyo, Gangbyeon, and Jamsil Zeta Plex. We will also continue an aggressive management policy to expand customers by converting stores like Mokpo, Sangmu, Jeonju Songcheon, and Changwon Jungang into warehouse-type discount stores."
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