How Precita Embraces Digital Transformation Into Their Business
While the whole world has entered the whirlwind of “digital transformation”, “artificial intelligence”, “internet of things”, and “big data”, where are Vietnamese businesses?
According to a survey by the Ministry of Industry and Trade, 61 percent of businesses in Vietnam are amidst the industrial revolution 4.0, and 21 percent are only in the beginning stages of preparation. In February of 2018, Precita started to enter the e-commerce market, becoming the first retail jewelry brand in Vietnam to do so.
Vietcetera had talked to Thu Nguyen, the head of marketing at Precita, in October of last year. This time, we met with Minh Tran, the head of e-commerce and digital marketing at Precita, to find out how Precita applies digital technology to optimize their growth.
Can you share with us your background and more about your role at Precita?
I am a woman in tech that possesses a startup spirit and affection for fashion. Before I returned to Vietnam in 2012, I lived and worked in the United States for 10 years. Since my return to Vietnam, most of the businesses I was involved with prior to returning were building products for start-up companies; Posiba and ICare Benefits. Posiba was a big data company based in the US, and ICare Benefits is a multinational retail company focusing on workers in Vietnam, Cambodia, and Laos.
I also worked for one of the top five information technology companies to build a large scale system for the US government. Back in 2017, when Precita opened their first store in Vietnam, I did not know much about the brand, to be honest. I first learned of it when I drove past the business. I saw the storefront, and it was beautiful. It reminded me of the many jewelry store brands I saw overseas, and I felt a connection.
Later that year in 2017, I joined Precita as a Senior Product Manager with a team of five talented and agile members. We built and launched our e-commerce website within one month of me joining the team. The first order we received was the same day that we launched the website in February of 2018. It was an experiment because we didn’t know whether the Vietnamese consumers would accept e-commerce for jewelry; it was still a new concept then.
Now, my scope of work is broader. I’m responsible for the e-commerce business aspect, including not just the website, but also business operations, digital marketing, and the studio team.
Why does Precita think it’s a good time to launch an e-commerce brand and how do you know the market is ready for an e-commerce jewelry brand?
We researched a lot of international brands before deciding to try e-commerce. In other developed countries like the US or India, e-commerce is really big. Some go from opening a physical store to an e-commerce store. Some begin as e-commerce, and then transition into building a physical store. Some remain as online stores only.
Before our launch, there was no other e-commerce site for jewelry in the Vietnamese market. We took a leap of faith and we really wanted to experiment to see if customers would accept it. Even though we know that jewelry retail is very different, it’s more about the personal and emotional experience.
Most of the time the customers still want to explore the website and social media before they go to the store to try and feel the product. So for us, the physical store is a leading element of the business strategy. After a year of running as an e-commerce, we really see its potential. For the first six months of this year, our sales revenue doubled compared to what we made last year. There is potential for us to move forward. With both the e-commerce foot-print and brick-and-mortar, we can offer more products and services for our customers. That’s a new goal for us. The future of jewelry retail is a combination of both digital and physical. It’s no longer just brick-and-mortar like in the past.
Which other parts of the company’s value chain are strengthened by digitization?
For Precita, a digital transformation means that we can apply the full potential of digital capabilities to automate business processes within the company. We use data to experiment with things and make data-driven decisions. From that, we can achieve new goals and our vision for the company.
The digital transformation happened in almost all parts of the company, from Human Resources to Information Technology. We transformed finance, merchandising, e-commerce, digital marketing, and even retail operations. Each department is impacted by digital transformation one way or another. I think that it works for us because Precita is still a young and agile organization. Our team members all have an aligned mindset. We defined the five core values as a company last year. Three of them are innovation, simplicity, and customer-centric. These three core values coupled with the mindset of the employees allows us to create this digital transformation.
Can you share changes you observed after applying this transformation into the business?
First, automated business processes help to cut down the unnecessary processes within the company, and allow us to move faster. For example, we deployed e-commerce, the Enterprise Resource Planning (ERP), and the point of sale (POS) system for our retail stores within a month. We integrated those three systems together to make a smooth transaction. It speeds up the process and eliminates unnecessary errors.
Besides automation, data is critical to help us make decisions for the business. All the analytics that we integrate into the business are collected from business intelligence tools that help us make decisions along the way. We learn about customer behaviors based on the purchases that they make and can see a customer’s preference. The next time they come into the store, we can recommend a supplement to what they bought online.
Do you notice any common patterns in customer behaviors when purchasing?
We target young women in the workplace, and we separate them by age groups. Right now our customers are college graduates in their 20-30s who are in the workforce enjoying their lives, middle-aged women who are already experts in their careers, or high-achieving women who just enjoy luxury products. We also have male customers who enjoy giving gifts. So far, we primarily focus on women. During Valentine’s Day or Women’s Day, we see an increase in men purchasing jewelry for ladies.
For men, they go to the store, and just take a look. They spend less time researching the products than women do. Woman usually approach us through Facebook. From Facebook, they go to our website, browse the product, think about it, and purchase or go to the store to try it on.
By following customers on the website and effectively targeting them, we can increase the conversion rate and analyze how many times this customer browses our products before they can make a decision. This way, we can optimize the journey of a customer making a purchase.
How can Precita offer its customers a premium experience and proximity when buying luxury jewelry online?
We have a support team that chats with customers to help them with buying decisions or give them advice on the product. One concern customers have is whether the jewelry, such as a ring, fits. On the website, it’s not possible to try the ring on. Hence, we developed an advanced tool that allows customers to put their ring on the phone screen. It will then tell you your ring size and recommend an assortment of rings that come in that size. That’s just one additional thing we offer on the website to create a friendly experience for the customer.
We also allow customers to buy online and pick up at the store. For those who want to see and feel the product, they can also try it on in store before purchasing. We offer free exchange for customers as well. In case the ring they bought online doesn’t fit, they can exchange it for free.
All of our products come with a stamp from Precita. We stand behind our products to make sure that they’re authentic. Our products are imported from overseas, and they go through a very strict process to make sure that they’re actually diamonds, and that the gold comes in the right carat.
How does the brand ensure that the purchase journey (from online to offline and vice versa) is seamless?
We really need to understand the journey of the customers in making a decision to purchase, and the persona around customers. We learn about the different touch points and pain points of our customers. After that, we have to be responsive and agile as to address the customers’ needs, or any specific points. Like I mentioned earlier, our employees also need to have a customer-centric mindset, so that when the customer purchases online or offline, we can make the whole journey come to life seamlessly.
We’re still working on it. We make sure that when the customers visit our products on the website, we have data of those customers. When the customers go to the store, our staff will have that data and use it efficiently to make the customers feel more comfortable or to recommend the product to complement what they looked at on the website.
Tell us some digital trends that are shaping the future of retail.
Customers are disrupting the retail sector. Their increased demand for innovative products and services are driving the growth of emerging technologies. Augmented reality (AR) will continue to rise. Let’s say for the jewelry or watch business, people will want to try on the product first. If you can’t go to the store to do it, you can do it on an app that scans your face. The machine will create a 3D image of your face; from there you can choose any piece to try on. I think AR will bridge the gap between the physical and digital world.
Other trends are personalization and customization. We recommend different products to each customer depending on their touchpoints. People don’t want to buy the same thing, and they tend to want to customize their products, especially for jewelry. At Precita, we have customized products that are well received by our customers. The customer can design the letters they want on a necklace. This is to show the personality of the millennials. They don’t like the “one-size-fits-all” mentality.
Lastly is micro-delivery. The retail business that can offer the product to the customer faster will win them over in the long run because customers have grown to be more impatient.
What’s next for Precita?
We expect to accelerate digital initiatives for prediction power, through the enhanced use of technology and big data analysis to enhance our product assortment, enhance personalization and behavioral targeting, promotional effectiveness, service offerings, and e-commerce to deliver a more seamless and engaging omni-channel customer experience.