Last week 33,000 people, including retailers, suppliers and technology experts gathered at the National Retail Federation (NRF) Big Show 2017 in New York, the biggest retail trade show of the year. Here are seven lessons they learned about the trends disrupting the retail landscape – and how to prepare for emerging trends.
- Be agile and entrepreneurial
Sir Richard Branson encouraged retailers to be willing to fail fast, learn and adapt, as he personally learned when Apple’s disruptive iPod overpowered his Virgin Megastores.1McDonald, Clare. NRF 2017: The key to success is not taking yourself too seriously, says Richard Branson. Computer Weekly. January 20, 2017. He also advised retail companies to get out of any business that doesn’t have a strong growth trajectory and get into new businesses as they emerge.2Best of NRF 2017: Top 10 Takeaways. Retail Information Systems (RIS) News. January 18, 2017.
- Prioritize and focus
While discussing Target’s business transformation strategy, Mike McNamara, the retailer’s EVP and chief information and digital officer, said Target brought 70% of engineering back in-house because the function is a strategic priority. He advised retailers to invest in the best engineering team they can afford to make business decision making more effective.3Best of NRF 2017: Top 10 Takeaways. Retail Information Systems (RIS) News. January 18, 2017.
- Think digital first
Beyond millennials, there is another powerful cohort: Digital natives born in 1995 or later. This generation of young consumers does not know a world without high-speed Internet and they want retail to reflect what’s “new” and “now.” Why should retail companies pay attention to them? This year digital natives will become the largest spending population with $200 billion in annual purchasing power. Retail companies can appeal to these shoppers with click and collect programs, fast e-commerce sites and mobile checkout.4Ruff, Corinne. 4 takeaways from NRF’s Big Show 2017. Retail Dive. January 18, 2017.
- Get closer to customers with big data
“Those who grab the power of data analytics will be those who make it to the next stage of retail,” said Brian Krzanich, CEO of Intel. That’s because consumers want to be understood, and predictive analytics allow companies to deliver relevant, personalized service.5Ryan, John. NRF: Blog day three – Virtual reality key to retail future. RetailWeek. January 17, 2017. IBM Watson, a powerful supercomputer, applies artificial intelligence to big data for real-time personalization. It can transform complex data that companies collect, yet never use, into actionable insights.6Best of NRF 2017: Top 10 Takeaways. Retail Information Systems (RIS) News. January 18, 2017. Data is vital to retail because, “The better we can predict the customer’s wishes, the better we can meet her needs,” stated Jeff Rosenfeld, Vice President of Insight and Analytics at Neiman Marcus.
- Virtual reality will reshape retail
As a cutting-edge technology, virtual reality is making headlines because it can help retail companies innovate in the following practical and fascinating ways:7Best of NRF 2017: Top 10 Takeaways. Retail Information Systems (RIS) News. January 18, 2017.
- Improve store layout and merchandising strategy by analyzing a shopper’s eye movement
- Experiment with merchandise layouts and receive instant feedback on whether a new display is likely to succeed
- Allow team members – even if they’re on different continents – to walk through virtual stores, grab items, stock shelves and test in-store concepts for success.
- Adapt to the Fourth Industrial Revolution
In recent years, retail has proven it is not immune to technological disruption. That’s why Kate Ancketill, CEO, GDR Creative Intelligence told retail companies, “You must adapt. You must accept … that automation is coming. It’s not if. It’s when.” During her presentation on the Fourth Industrial Revolution – the fusion of the physical, digital and biological worlds, including artificial intelligence (AI) – she shared a startling Oxford study finding: 47% of U.S. workers are at risk of losing a job to automation and AI within the next 20 years.8The urgency of adaptation. STORES Convention Daily. January 17, 2017.
- Tap into retail’s bounty of people power
While retail companies often focus on customers and products, it is time to pay greater attention to store associates, who represent the key to the future success of the retail industry. To compete well today, companies must keep up with evolving consumer behaviour. Exceptional customer service by well-trained, frontline store associates is essential to retail success. While the retail sector employs about a quarter of American workers, retailers face a 60% turnover rate. In response, companies must now engage, reward and develop their talent with improved training and compensation. Upon launching this year’s show, NRF announced a new retail training and credentialing initiative called RISE (Retail Industry Skills & Education) UP to tap into the power of retail talent.9Ruff, Corinne. 4 takeaways from NRF’s Big Show 2017. Retail Dive. January 18, 2017.
For more Big Show highlights, check out NRF’s website.
|↑1||McDonald, Clare. NRF 2017: The key to success is not taking yourself too seriously, says Richard Branson. Computer Weekly. January 20, 2017.|
|↑2, ↑3, ↑6, ↑7||Best of NRF 2017: Top 10 Takeaways. Retail Information Systems (RIS) News. January 18, 2017.|
|↑4, ↑9||Ruff, Corinne. 4 takeaways from NRF’s Big Show 2017. Retail Dive. January 18, 2017.|
|↑5||Ryan, John. NRF: Blog day three – Virtual reality key to retail future. RetailWeek. January 17, 2017.|
|↑8||The urgency of adaptation. STORES Convention Daily. January 17, 2017.|