Danny Le, CEO of Vietnam’s Masan Group, shared some insights on how the group could successfully achieve digital transformation and gave advice on where businesses should start to accomplish such goals.
The COVID-19 pandemic changed consumer behavior and accelerated the digitization process, and the most resilient businesses are those that quickly applied necessary technology to boost their digital transformation.
During the discussion session on developing the digital economy at the Business Forum 2022 organized by Forbes Vietnam, CEO of Masan Group Danny Le shared some insights on where businesses should start in their journey to achieve digital transformation.
Where to start?
Starting as a fast-moving consumer goods company, Masan entered the retail sector in 2019 and aims to transform into a consumer technology business in 2022.
However, the technology factor is not enough to become an independent business model at Masan because it does not create enough of a use case to replicate the model and generate sufficient profits to reinvest, according to Le.
Understanding its biggest asset is a large customer base with millions of transactions taking place every day, Masan determined that it is best to apply technologies to solve unmet needs and bring outstanding benefits to consumers.
“The first question we always ask ourselves is what market challenges we need to address,” Le stated.
“When we find the answer, we will use our understanding and application of technology to solve these challenges.”
When Masan aims to provide consumers with personalized experiences and possibly expand into digital entertainment, for example, the group needs big data applications to solve emerging problems, the CEO explained.
“It is important to build a strong team, not necessarily the best technology experts, but a team of people who understand technology to provide effective solutions and have a consumer-centric mindset in line with Masan's overall strategy to bring good value to consumers,” he said.
Collaboration with experts
From a business specializing in instant noodles, fish sauce, and soy sauce with a history of more than 25 years, Masan managed to rapidly transform and make technology the core pillar of its development strategy.
To do that, the group's leadership is determined to leverage technology and concluded that finding the right partners is the fastest way to shorten this process.
In May 2021, Masan cooperated with e-commerce giant Alibaba to promote the retail of essential goods on online channels.
The agreement with Lazada – Alibaba's e-commerce platform in Southeast Asia – has helped accelerate the group's digital transformation process, while optimizing and saving costs and improving customer service quality.
In September the same year, Masan laid the foundation for its digitization by acquiring Reddi mobile network, an important piece for the group to build a loyalty program in the future.
“Right after the COVID-19 pandemic, our first venture was to invest in the acquisition of 25 percent of the shares of Trusting Social, a fintech company specializing in providing artificial intelligence [AI] and machine learning [ML] solutions,” Le elaborated.
Thanks to the technology of Trusting Social, Masan is able to provide large-scale credit services to the vast majority of ordinary users.
Along with using AI and ML and cooperating with banking partners to provide credit services, Masan also focuses on developing the Point of Life ecosystem to understand each user's transaction and customize offers based on their purchase history.
“Within the first one to two years, Masan will deploy and perfect the ecosystem, before utilizing it to understand customers effectively and boost cooperation with traditional trading partners,” Le said.
Empowering traditional commerce with the power of technology is how Alibaba became successful in China, and it is also how Masan chooses to serve its 100 million consumers.