“More healthy, more vibrant, innovative and exciting than ever.” – That was the verdict for the retail sector at the recent National Retail Federation (NRF) Big Show in New York.
This year’s Big Show marked the 108th time the event has been hosted and it was bigger than better than ever before, attracting over 38,000 attendees who were keen to understand the future of retail, the technology driving it and the changing customer expectation of an increasingly online world.
Here’s are just some of the themes emerging from the three-day event…
“I would love to say that retail is back, but that would be wrong. Retail never went away. As I stand here today, I can say that our industry is more healthy, vibrant, innovative and exciting than ever.” NRF Chairman Chris Baldwin
The NRF Big Show is considered the US retail industry’s premier event, and this year the tone was upbeat, and the outlook was positive, despite a changing retail landscape.
Kicking off the event on January 13, NRF Chairman Chris Baldwin asked who in the crowd remembered 2016?
“That was the year of the supposed ‘retail apocalypse,’ complete with store closings, bankruptcies and layoffs,” he reflected.
The dire predictions had not come to fruition, he argued, with growth that had outpaced America’s GDP since 2016, 2000 net new store openings in 2018, and an expected increase in revenue of 4.5 per cent over 2017.
The reason for the positive outcome? Good leaders and nimble companies who were helping “reimagine” the industry.
Among those reimagining retail were panelists and exhibitors discussing everything from the changing customer experience to robots, big data and the new role of bricks and mortar.
The new role of bricks and mortar
“Physical retail is no longer about the distribution of goods, but about building brand equity.” – Lee Peterson of WD Partners
Looking back over the past 20 years in retail, Lee Peterson of WD Partners noted bricks and mortar was not dying but evolving to fill a new role.
He noted while retail sales were up, foot traffic in stores had been going down 10 per cent year-over-year for the last decade or so.
Peterson argued this was indicative of a changing era, where bricks and mortar stores were not about the sale of items but rather about building brand equity.
He cited brands such as Vans and Dr. Martens, who have stores with no merchandise. They exist for people to socialise in or otherwise use as a gathering place, and along the way to increase their affinity for the brand, he said.
Other new roles for the store of the present and future included click-and-collect, and order fulfilment. In many cases it’s easier and cheaper to ship an item from a store’s inventory than from an online distribution centre, Peterson noted.
The customer experience
“Having big stores with a lot of stuff and a great selection is not enough. Customers want more. They have more at their fingertips every day so now it’s about experience. It’s about service, it’s about speed.”- Healey Cypher, CEO of Zivelo.
The “customer experience” is the current catch cry in retail and this year proved no exception, with a panel of experts noting the art of meeting consumer expectation came down to harnessing the best of both the online and real-world retail realms.
Tech was important, they reflected, but not the be-all and end-all. Instead, using it effectively was about good deployment.
They urged retailers implementing new technology to:
- Start with the right mindset and ask the right questions when considering what their consumer wants and needs
- Use the wealth of in-store data available
- Ensure solving problems using tech doesn’t create friction elsewhere
- Make store associates feel like heroes by offering incentives and ensuring they know what they’re talking about
- Remember innovation is the by-product of solving a genuine customer problem
Meanwhile, some major retailers showcased the way they had utilised technology to improve the customer experience by bringing “ease, convenience and anticipation to consumers’ lives”.
- Whirlpool noted they had rethought product presentation in showrooms and customised the selling experience to help associates bring deeper information to consumer purchase decisions.
- Sleep Number added consumer value by connecting its products to their well-being, which was key to building loyal customer relationships; and
- The Autonomous Vehicle Alliance predicted vehicles could assist retail by serving as both on-demand modes of transportation as well as distribution centers for retailers.
In a Big Show with a heavy focus technology, one of the most futuristic concepts covered was robotics.
A panel on this subject delved into the role robots could play in retail, but more specifically took a deep dive into a recent project that saw a 6-foot-3-inch-tall rolling robot named Marty become a fixture of grocery stores in Harrisburg and Carlisle, Pennsylvania.
“We wanted to personify the robot,” a panellist noted. “So, we gave him googly eyes and a name. The customers love him, especially the kids. They’ve taken thousands of selfies with him.”.
The robot currently trundles about the stores identifying spills, but plans are afoot to see him also recognise out-of-stock items.
The panel explained that in retail, customer service was key. If a robot could take over the chore of preventing out-of-stocks, store associates could make more profitable use of their time by personally assisting customers.
The final transaction
While this year’s NRF Big Show was bright and upbeat about the future of retail, one theme was patently clear – the retail landscape is already reimagining its future amidst a technological revolution that has already delivered disruption.
Retail is not what it was 10 or 15 years ago, the customer expectation is different, and the role of bricks and mortar has shifted to meet that demand.
Moreover, it’s no longer a cavernous divide between online and real-world – the two work hand in hand to meet a customer experience more refined, more immediate and more personal than ever before.