The future of retail pulled forward

future-of-retail-pulled-forward

The future of retail has been pushed forward according to keynote speakers at Retail’s Big Show in the US, with e-commerce accelerated and new customer needs emerging.

Meanwhile, the role of bricks and mortar continues to be important, but in some instances, it’s all about the theatre and in others, it is serving as a hub.

Here’s what else was covered at this year’s Big Show…

A very different event

Held virtually and spanning two instalments, this year’s Big Show by the US National Retail Federation looked very different to years gone by. But after a year of complete disruption that challenged retail like never before, the insights it offered were seminal.

The lineup commenced on January 12 for the first chapter of the event, with a second chapter to take place in June, and the messages were clear – the role of bricks and mortar is changing, omnichannel is the new normal, and meeting the customer need has never been more paramount.

The future pulled forward

The future pulled forward

In a session on ‘Technologies Shaping the Store of 2025’, panellists noted the pandemic had “pulled the future forward”, accelerating adoption of e-commerce.

However, consumers still want curation, personal guidance and authentic connection, regardless of how they shop.

“In the world of commerce, the things we thought we would see in 2030 are now things that we’re seeing today,” Shopify director of product, retail, Arpan Podduturi, explained.

Meanwhile, head of global retail operations at Allbirds, Travis Boyce, noted the role of bricks and mortar was transforming into a hub where shoppers could fulfil needs like buying online and returning in-store or engage in events as retail and communities begin to open back up.

The theatre of bricks and mortar

Luxury retailer Saks Fifth Avenue was among the stores represented in a chat focused on re-imagining retail, with CEO Marc Metrick also agreeing the events of 2020 had provided an accelerant for change.

However, he also added that in the case of luxury bricks and mortar retail, physical stores continue to be important.

“For luxury, especially, it’s the theatre: People want to see the show,” he said, and since Saks reopened its stores, they have been performing only slightly below 2019 levels.

Sustainability still matters

Sustainability still matters

A session involving IKEA and H&M representatives looked at whether the customer commitment to sustainable purchasing habits changed as a result of 2020.

Both retailers noted they didn’t, but the consumer budget tended to be smaller and the product focus altered to align with the new normal. They also explained that Gen-Z continued to lead the socially conscious push and had a huge demand for information about products.

“Having grown up as digital natives they understand — maybe better than any preceding generation — how to access information,” H&M US sustainability manager Abigail Kammerzell noted.

“And they’re really demanding about it. They want to know where our clothing is made and out of what, what the social implications of that are, and what’s the responsibility of the consumer once they’re done with it.

“On top of that, Gen Z has definite expectations about what a business is: It’s not just here to provide an item, it’s also here to improve the society and community in which it operates.”

Meeting the customer’s needs

Another thing Saks observed in 2020 was that in the future they could better cater to the product cycle.

For example, their seasonal ranges usually arrive in-store almost six months before the season commences and then the shop needs to push the product. In 2020, stores were closed in the early half of the year and then reopened in May.

“When the customers arrived, guess what was in the stores? Summer product,” Mr Metrick said.

“It had been on the floors since February, but this was the first time they’d seen it. We didn’t have to push it or promote it. It just sold, because we were meeting the customer’s needs.”

Tech delivering a better customer experience

customer-experience-future-of-retail

It’s not enough for a retailer to excel in one area, they need to be excellent all-rounders. That was the message from Wayfair CEO Niraj Shah, who noted what “you’re not good at limits your growth and being great in other areas doesn’t make up for it”.

As an online retailer focussed on furniture, Mr Shah explained for his company that involved a focus on both merchandising and logistics.

But most importantly it involved intimately understanding exactly what a customer needs, and then drawing on tools like technology to meet those requirements.

Lowe’s CEO Marvin Ellison agreed, explaining the true role of technology was to deliver a better customer experience.

“As we look to the future, we ask one single question: What is in the best interest of our customers?

“The most effective technology is a technology that no one sees. All the customer knows is that the transaction was easy. All the associates and supply people know is that the system works well.

“And that,” Mr Ellison said, “is what good innovation looks like.”

Further information about Retail’s Big Show is available at the National Retail Federation.