Data, EX, bricks and mortar – three key takeaways from NRF 2020
We take a look at some of the major themes that emerged from Retail’s BIG show this year, what they mean for the future of the industry, and how retailers can tackle the challenges they present.
Retail’s BIG show has always been a principal arena for retail commentary, setting the agenda for the coming year and pinpointing the industry’s major challenges. NRF 2020 was no exception, though in the current global economic climate the conversation has understandably seen a definite shift from previous years’ ideas-based buzz about innovation and transformation to nuts-and-bolts practicalities and how to get things done. While there was a lot of discussion about perennial retail concerns from automation to supply chain management, three key themes emerged from the panels, keynotes and visitors themselves:
What do we do with all this data?
Microsoft CEO Satya Nadella set the tone with a keynote focusing on data – how much retailers generate (an astonishing 40 terabytes an hour) and how the industry needs to use it to know its customers, elevate its employees, create an intelligent supply chain and reinvent its business models. But the word on the Javits Center floor was that retailers really haven’t got to grips with it – ‘they are collecting and drowning in enormous amounts of data and don’t know what to do with it’, said one attendee after a panel session on the power of data insight to manage customer engagement and demonstrate relevance.
It feels like a big, difficult problem to solve, and fear of complexity has led to inertia. It has never been more important to demonstrate just how easy it is to integrate data - including third-party and legacy systems - from every part of the business and use it to drive sales, improve operations and provide better customer experiences.
Employee experience drives customer experience
One of Satya Nadella’s key points was that using technology to support employees is ‘crucial’ to retail success in the next decade: ‘giving data to employees is the single most ROI-intensive thing you can do. It increases your conversion rate by 15% and your satisfaction rate by 10%.’
He used Ikea’s employee work management app as an example, which has revolutionised the way they spend their time on the shop floor.
Helena Foulkes, Hudson Bay Company chief executive, reinforced the value of giving store associates access to customer data: ‘We have 4,500 stylists [at Saks Fifth Avenue] who we’ve empowered with more digital data and tools to meet the needs and address the interests of their customers so they can close deals and sales in the store.’
Acknowledgement of the vital role store associates will play in the future of retail is a positive first step – acting on this knowledge will be the true test.
The revival of the physical store and the rise of ‘retailtainment’
Retailers who have invested in the in-store experience are reaping the benefits of reduced customer acquisition costs, according to senior analysts and executives speaking across a number of different panels at NRF 2020. While pure-plays have paid a steep price to attract and keep customers, rendering some of them unprofitable for the foreseeable future, retailers offering a mix of physical and digital experiences have been rewarded with increased customer interest and loyalty. Retailers are finally tuning in to shoppers’ desire for human connection and interaction – something that they can only get from brick-and-mortar spaces offering one-on-one conversations with store associates who know their stuff.
Related to this, ‘retailtainment’ has emerged as a recognised trend this year – retailers and shopping malls going the extra mile to provide something above and beyond the transactional relationship, from in-store cafes to workshops and fashion events. As we set out in last year’s whitepaper Store of the Future: the Experiential Store, retail that’s worthy of an admission fee can make a significant contribution to footfall, provided all the back office processes and shop floor support are there to turn visits into sales.
Each of these challenges – data integration and analysis, employee involvement and next-level in-store experience – can be met, managed and used to drive performance across all areas of the business, provided you’ve got the right system in place. Take a look at RetailOS® to find out more.