Every year we look forward to our annual trip to New York for The Big Show. This is the annual retail conference hosted by the National Retailer Federation and is a festival of everything retail. From thought leadership, cutting edge technology and best in class case studies, we pack our thermals and good walking shoes and have a decent coffee before we depart.
But the pandemic has thrown us out of sorts and for the second year running, we have hunkered down in NZ and watched from afar (not too bad when you are sitting watching from the beach at Whangamata). However, we are very appreciative that through our networks, connections, and OnDemand sessions that we can deliver some of the insights from NRF even if we didn’t get there IRL.
NRF’s 2022 Big Show was far from big. Usually it is hall after hall of endless retail. But we have to remember it was the first really big in-person gathering that the industry has seen since early 2020. Most of the big tech companies such as Intel and SAP did not show and many medium sized firms also opted out. A lot of international attendees also chose not to attend (we could get to the event from NZ but not get back in!) What this did allow for was smaller innovators and tech start-up’s to punch above their weight.
The 2022 Themes
On a macro level, NRF focused on emerging tech, innovation, automation, integration, and inclusion.
Brian Cornell, CEO of Target, talked about the supply chain challenges that will continue into 2022. Short-term the fix is to use technologies to gain better visibility into the pipeline to be able to anticipate future problems. Being able to be agile and pivot is key as new surprises and challenges continue to emerge.
Cornell also discussed keeping the customer at the heart of decision making and the importance of new partnerships like Ulta Beauty and Apple. For Target the future is about providing one-stop convenience and a wide variety of product categories to discover.
We have talked about hybrid shoppers in 2021 but it is recognised that the pandemic has accelerated adoption and transfer to new shopping behaviours. Online shopping is further entrenched with click and collect and curbside pickup growing – with a new array of technologies to support these behaviours.
Unified commerce and solutions that enable a synergistic approach across platforms from digital, physical and social were explored. This continues to be a major challenge for retailers who want not only a single view of the customer, but to be able to communicate and serve customers seamlessly in an ever complex maze of internal systems.
Pete Nordstrom, President and Chief Brand Officer at Nordstrom, also discussed the balance of digital and physical along with the importance of unified commerce; customers want to shop both online and in stores with the balance probably settling around 40 percent for online.
Amar Singh from Kantar talked of the path to success of unified commerce, “Most vendors are creating integrated ecosystems of automation tools, interactive digital shelves, and AI solutions to drive operational efficiencies and shopper engagement. The successful execution of predictive analytics and digital interaction within both metaverse and in-store environments will drive future success for retailers.”
Sustainability, purpose and inclusivity
Whilst it has been a core movement overseas, inclusion was a real focus with an entire hall dedicated to the cause. Retailers walking the talk means reflecting diversity in the workforce as well as the customer base. To do this you need to understand the needs of these groups and be really in touch with these important stakeholders.
Social media and social commerce has elevated the profile of purpose-driven consumerism. Discussion around growth in the number of consumers that look for companies and brands that align with their own values and promote health and wellness. Recognition is given and consumers become evangelists for brands and retailers who are making a difference beyond profits but it comes with a real risk of ensuring the checks and measures are in place to support the initiatives or activities.
Sustainability continues to be a key focus for retailers. The balance between being affordable and making change with intent still remains a key issue as retailers set core measures for change.
Optimising the physical store continues to be a hot topic especially considering the challenges from the pandemic with customers enduring endless lines to enter stores alongside empty shelves, stock delays and reduced staffing.
Various technologies that track shoppers and detect bottlenecks have become even more relevant. They deliver value on both operations and customer experience fronts, plus they are becoming more nimble and less expensive.
Rather than investing in new equipment, many technology companies are looking at how to leverage existing kit and gain better outcomes. One technology company we saw come up often was Pathr.ai This company uses spatial intelligence to understand movement in physical spaces like stores, distribution centres, and shopping centres – using existing security cameras.
Clearly it makes sense to optimise existing assets to improve the customer experience.
Another stand out on the voice commerce side, Vocalytics’ “listening” software can be deployed within existing camera infrastructure to capture shopper sentiment, monitor in-store safety, and identify upsell opportunities.
In summary, in a race to become more nimble, it is clear retailers and technologists are taking a hard look at what can be autonomous, how to deploy talent, and ways to enhance the shopper experience.
WHAT THE BIG GUNS SAID
When we attend, it’s all about hearing from the big retail heavyweights in-real-life. Here are some of our favourites and what they had to say at NRF 2022 sessions. In particular they covered supply chain, consumer shopping trends and branding to health and safety, sustainability and customer service.
“As we think about what we need to be as a company, it’s been really simple. We want to take care of associates and be the best workplace we can be. We want to delight our customers. We want to make our communities better.” Marvin Ellison, chairman and CEO, Lowe’s Companies Inc.
“[Customers] came out to shop. They were out physically shopping in our stores. They returned to shopping malls. They were engaged. They wanted to be out there enjoying what retail can provide. It gives me incredible optimism for the future.” Brian Cornell, Target chairman and CEO
“We build a closeness at a very fundamental human level. Then on top of that, you’re using a lot of technology — personalisation, e-commerce, delivery — that builds on this emotional bond and creates a lot of stickiness. And I think that’s a lot of the value of the company.” Vivek Sankaran, Albertsons CEO
“From the beginning, one of our most important tenets was guarding the health of both our staff and the customers. We were constantly and empirically looking to science to ask, ‘What is the safest environment, given what we know today?’ and then providing the infrastructure for our teams as much as possible to meet those changing safety guidelines. The most important issue to us, then as now, is that we want the customer or employee to feel safe, based on their own life situation.” Corie Barry, Best Buy CEO
“We want to make sustainability affordable for the many, not only affordable for a few. That’s extremely important in the way we see this from the brand’s perspective.” Javier Quiñones, Ikea U.S. CEO and chief sustainability officer
“I believe in the speed of innovation and the loyalty and longevity of customer care that a company can deliver. Innovation breeds a lot of focus and improvement — whether it’s in process, in people protocols, infrastructure, architecture, it doesn’t really matter — toward the service of customers.” Sumit Singh, Chewy CEO
“We’re in a rapidly growing economy with a high demand level, which has led to out-of-stocks, supply chain problems, and price increases. Two major things we hear about from our consumers are their health and safety and rising inflation. We as an industry need to work together to remove cost from the supply chain, to make sure our customers can afford what they need.” John Furner, president and CEO of Walmart U.S.
THE RETAIL TOUR – THE BIG WOW FOR 2022
The guided tours are always a bonus (but just a taster before our deep-dive tours) which all attendees experience the latest technologies, store designs, employee training programs, safe shopping, best practices & much more.
So while we missed the opportunity to get insider insights here are two concepts which you possibly haven’t had the chance to see yet (the real goodies stay under wraps until our next Breakfast Briefing)
American Dream: Entertainment meets retail
American Dream has been called one of the seven wonders of the retail world with over 400 stores and attractions. Designed for Instagram and TikTok spots. It is among the most technologically advanced shopping centres in the world and leading brands such as Hermes, Zara, Primark and many more have their flagship stores at American Dream. It has one the most advanced uses of digital signage technology and each store has a unique experience found only at American Dream. It has the best-in-class luxury, fashion, beauty, electronics, sports, children's and technology stores all in one close location.
Targeted for: Fashion, Beauty, Luxury, Shopping Centres, Investors, Digital Technology, Store Design, Safety , Employee Training, Family Experience, Grocery, CPG, and Social Media Integration.
Features: 400 Stores, The Avenue (Luxury Flagship Stores) Legoland, DreamWorks Water Park, Nickelodeon Universe, Big Snow, SEA-LIFE Aquarium.
Hudson Yards: Merging Bricks-and-Mortar with Digital
One of the newest shopping facilities in New York City, Hudson Yards represents the state of retail today. The vertical mall is easy to navigate and is a remarkable riff on the concept of new retail pioneered in China by Alibaba founder Jack Ma. From out-of-the-box mindfulness to participatory experiences to luxury brands reinventing themselves, Hudson Yards offers in a single structure the best of what leading-edge retail has to offer.
Targeted for: Fashion, Beauty, Luxury, Grocery, Digital Technology, Store Design, Safety, Employee Training, Family Experience, and CPG.
Features: Vertical Mall with four levels to navigate stores from cars (Genesis Studio) to children (Camp) and the highest outdoor sky deck in the Western Hemisphere.