How ITC is using automation and data analytics for competitive advantage

If you happen to shop for gourmet chocolates at the Fabelle store in one of the ITC Hotel properties, or if you are a regular at its D2C platform (direct to consumer platform), ITC Store, or if you have participated in some of the consumer promos on its website, the data of all these interactions would go into its centralised customer data hub. It is the company's data repository which helps create consumer cohorts to be able to target ads more efficiently. By using analytic tools the customer hub analyses a consumer's buying habits. If he/she has bought frozen snacks or its dairy products on ITC Store, what could be the other products he/she is likely to buy. The customer hub then creates multiple consumer cohorts and serves ads to consumers.

“If you start with the consumer, the focus is on real time, new age insighting, deep social listening, bespoke brand campaigns & engagement and hyper-personalisation. We have implemented a variety of digital tools and platforms such as the ‘ITC Sixth Sense’ which is a sensing engine, that constantly listens to social conversations, and gathers insights. We further classify these conversations based on points of interest, topicality and so on. At the same time, we created a ‘Customer data hub’, a central repository of first party data, which is powered by robust AI engines to segment consumers at scale and understand their needs. We also have affinity engines which enrich the data enabling us to sharp-target consumer cohorts and make our interventions more cost efficient. Digital marketing costs drop and effectiveness improves dramatically as we use first party data,” explains B. Sumant, executive director, ITC. 

“Ever since Mr Sanjiv Puri came on board as Chairman, we have been focusing on creating a future tech enterprise. He has invested a lot of time and resources in putting together a complete digital backbone for the organisation,” says Sumant.

The focus on digitisation and automation is in manufacturing and supply chain too. “Our manufacturing plants have a lot of automated data capture and this enables us to do quick change overs, produce multiple products without losing efficiency and effectiveness. If you can sense and respond to consumer needs quickly, you have to create more products. Because we use IoT devices we do a lot of analytics, that gives manufacturing plants a lot of flexibility and speed,” explains Sumant.

On the retail and distribution front, the company has launched two apps – the first being an ordering app which has been downloaded by 4.6 lakh retailers. It allows them to order any product any time. With over 8,000 data points, the second app (which has 2.5 million retailers) gives every retailer a unique recommendation of what SKU to have in his store, based on a host of parameters such as the locality where he has his, the kind of affordability, rentals of that locality, affluence of the locality etc. "We do pin code-wise sales analysis. If there is a product on the ITC Store that is selling well in a particular pin code, it is automatically pushed to the salesman app," Sumant further explains.

Focus on future-tech is core to ITC strategy. "With better consumer understanding and agility, we are offering more relevant and focused products. We are also able to lower our costs. We have strategic cost management teams across the board, they look at how to lower costs, alternate sourcing, and how to do sourcing at scale. There is a lot of use of technology to reduce cost structures."

"Customer acquisition is the biggest cost on digital today, so a lot of work is being done to reduce the cost of customer acquisition, create first-party data, create lifetime value for customers which will rationalise your cost of acquisition. Technology is playing a huge role to improve our ability to grow, produce products which are relevant, produce them faster and reduce costs. It helps both topline as well as improving profitability," he further adds.

ITC's tech focus seems to be paying off. Not only are its share prices surging, its Q3FY23 revenue has increased by over 32%, while profits went up by 12.7%.