From simple shoe store
MANILA, Philippines — The SM Group is preparing to take its retail empire to the next level, with the company that started from a shoe store in Manila over six decades ago lacing up its boots to harness the power of artificial intelligence (AI) to elevate further the customer shopping experience.
SM Prime executive committee chairman Hans Sy apparently is a big fan of AI, and he is keen on making the most out of the technology to take SM to a whole new level.
“With the use of technology like AI, it will really help us enhance how to improve the services to our customers. That is what everybody would be looking for. I mean, the feel good (factor) of a person should be the target of every retailer,” Sy said in an interview.
“So how do you make them feel good? You have to really understand the customers. And the best way I saw with AI is understanding the customer. Wouldn’t you feel good if in the future you enter a mall, they would immediately even identify you like, ‘oh good morning ma’am,’ and then, ‘would you like to know that we have this sale on this tenant or that,’ because we know already what the customer really wants,” he said.
Sy continued: “So you’d be surprised, the next few years that’s really going to come out. It’s really knowing your customer already when they come in, being able to address the needs that they want to. You’d feel good, feeling very important. Once you feel good, it will make people come back.”
Sy’s father, Henry Sy Sr., built his first shoe store in Quiapo in 1948 and later on opened a bigger shoe store.
SM’s first ShoeMart store opened in Carriedo, Manila in 1958. It then evolved into a bigger concept that led to the opening of the first SM shopping center, SM City North EDSA, in 1985.
SM currently has 86 malls across the country. After the opening of SM City Caloocan last May, SM Prime is scheduled to open three additional new malls this year, including SM City J Mall in Cebu, SM City San Fernando La Union and SM City Laoag.
It is targeting to have a portfolio of 100 malls in the country by the end of 2027 as it looks to further solidify its dominance in the Philippine retail landscape.
Sy said AI will be a big part of SM’s growth in the coming years.
“A lot of people do not understand AI. AI is not only just purely how to enhance the services. AI is also helping you get more data and analyzing data—what the customer really wants and what the customer really looks for,” he said.
“A lot of people think AI is just, ‘oh this one will automatically take over the jobs of people.’ That’s not true. AI can enhance the whole experience right now,” he said.
In the retail world, Sy said it is important to always be innovative and understand how to make things easier for customers.
“This AI thing is really something that I find it to be a very useful tool because not only does it help to simply understand your customer, it can help you a lot. In fact, even on sustainability it can also help you. As I said, if you know what type are the people’s needs and these kinds of things, you can already prepare yourself and have less wastage. So these kinds of things,” Sy said.
“I do see a very good future. People are going to just be able to benefit and enjoy that and really call it an experience,” he said.
With its decades of experience in the retail sector, SM is no stranger to innovations and new technologies.
Sy also recalled how the company successfully managed to hold its ground amid the emergence of online shopping.
“Let me bring you even further earlier than the pre-pandemic days. Let me bring you back to the year 2010. That was when online shopping started coming in very strong. I remember very clearly those days people were saying that’s the end of shopping centers because nobody needs to go out anymore or the end of the department store because nobody needs to shop or go out and buy their things as they can always go online. Then frankly speaking, even me myself I was in that so called denial stage. Oh it won’t happen,” Sy said.
“So then I said we got to really do something about it. Then I gathered our guys and started really looking into what can online shopping do to hurt us. What can online shopping not do and we found out a lot of things. So one of the things that they can’t do is bring the experience. We created also our online just to be able to match what’s going on but at the same time, we never give up on really enhancing the whole shopping as an experience,” he said.
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