This week 34,000 people interested in retail gathered in New York City at NRF 2016, Retail’s Big Show to see and hear about the newest trends, challenges, and innovations in the retail industry. It was an event that featured industry leaders sharing their challenges, but more importantly, sharing their visions and strategies on how to be successful in the future.
“Fundamental to retailers’ success in the future will be their ability to adapt and change to consumers’ expectations.”
Fundamental to retailers’ success in the future will be their ability to adapt and change to consumers’ expectations, and they are all worried about the impact of Millennials. Mentioned several times, we will see the full force of Millennial starting in 2017, and retailers are scrambling to figure out how to respond to their unique buying habits. Those habits will influence consumers older and younger. So no matter the age of your target market, change is coming, or already here.
The Big Show covered topics from technology to branding and store environments to digital experiences. Below are the five themes that resonated through many sessions and keynotes throughout the event.
- Retail has moved beyond omnichannel to consumer-centric commerce.
Retailers speak in channels, not consumers. If omnichannel is the brand’s attempt to create a consistent consumer experience across channels and devices, consumer-centric commerce takes retailers beyond channels to creating experiences in which the consumer and its expectations are at the center. It is about creating frictionless commerce. It is allowing consumers to buy any time, any where, in any way. Omnichannel limits retailers by continuing to organize in silos, separating e-commerce from stores and digital from traditional. With the consumer at the center, companies are reorganizing to create seamless experiences, no matter the consumer touch point. This reorganization goes beyond people. Data must be centralized and leveraged across the organization, creating one truth from which to build an engaging consumer experience.
- Consumers want to buy experiences, not things.
The motivation to buy is fundamentally changing with Millennials. They are choosing experiences over things, and they want to know the “why.” This means that we are moving away from direct selling and into indirect storytelling that influences a more elongated purchase process. Retailers must create environments that weave the brand and product stories into a compelling and engaging experience. Even better is if the experience is shareable. What story is your brand telling? If you don’t know, go back to the basics and understand the fundamental truth of the brand and how it can solve consumers’ needs. A good retail experience should be modeled on good consumer experiences that may be outside of retail (think Uber and Disney), because expectations are formed beyond the time consumers shop for products.
- Personalization is happening in places you would not expect.
Personalization goes beyond the digital journey and is moving into the entire brand experience. One of the best keynotes was with Hershey’s President of North America, Michele Buck. She shared how Hershey’s is working to create engaging in-store experiences with retail partners. Hershey’s has become a vital partner for retailers by sharing a wealth of data and insights at the store level. This means exploring customized planograms, store displays, and product mixes. Because Hershey’s has become such a vital partner, they now have the ability to test innovations in the real world. This includes kiosks in-store to create personalized stickers (print on demand) for Hershey’s Kisses and even experimenting with chocolate 3D printing to create the ultimate personalized product experience.
- Information sharing is imperative if the ideal consumer experience is to be achieved.
“Collaboration is the new competition. The biggest threat is not one another, it is the status quo,” said Steven Lowy, Westfield Corp. Retailers have traditionally been highly protective of intellectual property and data. In this environment, retailers have very limited insights into their consumer’s behaviors. They only see what the consumer allows them to see through direct interactions with the brand. Sharing information with partners, related industries, and even with competitors will allow retailers to gain the insights necessary to create a compelling shopping experience. A great place to start is with your own organization. Free data from silos and leverage the internal collective knowledge. Then look outside and determine who has additional data that could compliment what you know to create that engaging consumer experience.
- Stores are not dying.
… But they need to change. Essentially the store concept has not changed in 150 years. You come in and browse, try it on, and then buy it. Retailers must reinvent the store into a place that seamlessly blends technology with storytelling to create an engaging experience to buy products – embracing the anywhere, any-way and any-how concept. The idea of endless aisles, access to the breadth of product information, multiple delivery options, and mobile payments are imperative. Retailers must create a reason to visit the store and find engaging and compelling ways to tell the story that inspire consumers to keep coming back.
- BONUS: Complacency is the enemy.
Technology is accelerating the rate of change in today’s world. Retailers must embrace this change and find innovative and new ways to create relationships with their consumers. Those that remain complacent will be left behind.
In all the sessions I attended, a few companies really stood out as embracing the idea of consumer-centric commerce. Below are the ones that were the most impressive.
- Hershey’s: Hershey’s is leveraging data from internal and external sources to partner with retailers to revolutionize the snack and confection aisles at a store level. And its innovations and experiments in personalization-on-demand is creating engaging and shareable experiences.
- American Express: AMEX has evolved from a freight forwarder to a massive player in the payments industry. But at its core it is a brand that delivers services to its customers. AMEX is embracing change by being at the forefront of electronic payments and developing unique partnerships with companies like Uber to stay relevant in consumers’ lives.
- House of Frasier: While the company came to e-commerce late in 2010, it quickly realized the importance of being consumer-centric, and in 18 months has restructured its organization to be completely focused on the consumer. This includes changing how technology, branding, creative, and data insights are structured and leveraged throughout the organization.
- Under Armour: Under Armour saw an opportunity to gather more consumer data and insights by leveraging communities and the wearables market. With recent acquisitions, it now has a network of 160 million connected athletes. Under Armour sees its future in “Connected Fitness,” leveraging data to better enhance consumers’ lives by creating platforms to connect consumers’ personal data, and creating a call-to-action for products to enhance that experience.
- Westfield Corporation: Westfield is creating malls that go beyond housing stores. It is developing innovative and engaging destinations that leverage entertainment, shopping, and dining. It is working to create a personalized shopping experience across the entire mall environment, truly curating an experience based on individual preferences and behaviors.
- Choice Hotels Group: Choice Hotels has evolved to better service its customers’ changing needs, and leading the way is its loyalty program. Choice Hotels understands that today’s consumers want immediate gratification. They don’t want to wait for points or rewards, they want them instantly. Choice has changed its program to allow consumers to earn points immediately, and then redeem earned points with an extensive partner network. Points have become currency for its customers, leading to higher engagement and ultimately, greater customer loyalty.
Special thanks to the NRF for putting together an event that featured thought leaders in the industry. The keynotes featured inspiring individuals that are reshaping how we do retail.
Checkout my tweets during the show: @scucchiara.