Varun's response lacks specificity and relevance to the question about integrating cloud services like AWS Lambda or Azure Functions in the Retail domain. Instead of addressing the technical aspects and benefits of using these services, Varun focuses on the preparation of business requirement documents, which is not directly related to the question. To improve, Varun could have discussed how AWS Lambda or Azure Functions were used to process data or automate tasks in a retail context, similar to the benchmark response.