In traditional form, January has brought with it another edition of the National Retail Federation’s BIG Show in New York City. The annual convention was packed again with retailers and vendors alike to look ahead to what the future holds for the state of retail. Coming on the heels of a positive holiday season, a sense of optimism was present in the Javits Center while we heard talks of disruption, customer experience, and how to effectively build a brand.
The Focus is the Same for a Reason
Themes of customer experience, omnichannel, and innovative technologies were again front and center in many of the expo hall and keynote sessions. But, this was also the case last year. Has the “state of disruption” finally ended for retail? The answer is no. However there has been a clear delineation between retailers who have seen the future and made moves, versus those that have not.
In each session where the word omnichannel was mentioned, it was inevitably followed by a slight laugh and faint rumblings of “buzzword”. But it begs the question – if omnichannel is such a buzzword, why do we still talk about it? It’s because there are many retailers who haven’t made the changes necessary to support omnichannel to offer their customers a truly seamless, consistent cross-channel experience.
Two statistics that stand out from the event:
- less than 50% of retailers provide associates access to real-time inventory, and
- less than 33% of store associates have access to a customer’s cross-channel order history.
Yes, the concepts of omnichannel and seamless customer experience are not new, but they’re also not easy. We will continue to see a focus on these areas as retailers actually move forward on the execution of these ideals.
Artificial Intelligence is the next Opportunity
NRF can serve as a kick in the pants for a retailer who has yet to leverage technology to enhance their customer experience – but what about the forward-thinking retailers who have already implemented their vision of customer experience and omnichannel?
Artificial intelligence continues to grow in the retail space as the potential use cases grow across the business. It’s not a silver bullet but it does allow a function to take the next step in effectiveness. In customer service, it’s helping chatbots with fluid customer interaction. It’s helping merchants with product catalog selections. It’s powering inventory placement and fulfillment. It’s enhancing personalization and what a customer sees when they view a website.
Simply put, artificial intelligence is allowing retailers to get better and to take the next step in their customer experience journeys. As more and more offerings include some element of AI, the prediction that retail spend on AI technology will continue to soar is a safe bet.
Looking Beyond the Technology
While a conference of this size lends itself to hype around the most futuristic and innovative concepts, there were two trends that found themselves lurking just beneath the surface of many presentations. The first – brick and mortar is very much alive and well. Former eCommerce pureplays such as UNTUCKit spoke about their strategy to move into brick and mortar, and the boost they got from an actual footprint. We’ve seen statistics lately showing how retailers are seeing massive bumps in web traffic, an overall average of 37%, when opening a new physical store. Hubert Joly, CEO of Best Buy, spoke of how his stores were once viewed of as a liability but now, they’ve been able to transform them into their biggest asset as it gives Best Buy not only an additional distribution center but also a place for customers to experience, touch, and feel.
Additionally, as Gen-Z takes a larger role in the retail marketplace, there is a clear push for retailers to establish socially conscious behaviors and show authenticity in their brands. The younger generations are putting their money behind brands they believe in – and brands are vying for space in the socially conscious shopper’s mind. TOMS makes their giving front and center and there is a clear sense of sincerity in their mission which creates a loyal following among their customers. Big brands such as Levi Strauss and Dick’s Sporting Goods spoke about their convictions to be leading with conscience. Sustainability, led by brands such as Eileen Fisher, continues to be an opportunity for retailers to show that they care about more than just the bottom line. While these areas are a little less sexy than having innovative in-store experiences, they are clear areas of focus for retailers looking to capture a younger customer base.
Thank you to the National Retail Federation for another fantastic event. If you have found this information valuable and would like to receive future insights about the retail industry, subscribe to our insights below or take a look at the solutions we can offer your business.