NRF 2020: 6 Trends Are Driving Big Retail
Who ever said brick and mortar retail is dead? While the explosive growth of Amazon has led to some fairly strong predictions of the demise of retail, you would never have known by walking the halls of New York’s Javitz Center during NRF 2020 this past week.
I found myself elbow to elbow, from having to settle for a seat in the overflow space to listen to Microsoft CEO Satya Nadella kick off the event early Sunday morning to having a difficult time entering some of the more popular booths like those of SAP, Intel, Microsoft, and IBM as retail business leaders flocked to see the latest and greatest at the retail show.
So what were the hot trends this year? While covering the floor of NRF may pale in comparison to CES, it was a big show, with a ton of traffic and a lot of excitement. Here are the trends that caught my eye.
1. Omnichannel is Back. Truth be told, omnichannel never really went away, but the hype had calmed down a bit over the past few years as the idea of omnichannel versus the execution left quite a gap in user experience. However, the idea of omnichannel is still quite promising as our online lives, our connected lives, and our in-store lives continue to more deeply intertwine.
2. End-to-end customer data collection and utilization. During the course of the NRF event, we heard a bunch of different product descriptions: 360 Journey, end-to-end analytics, customer data platform, etc., but what was really being touted was the ability to take a person’s entire data profile and use it to drive a shopping journey that can be optimized, tracked, and frictionless. It starts with the growth of the analytics/CDP. This is why I believe that the Microsoft, SAP, SAS, Oracle, and Salesforce booths saw consistent foot traffic—these are the companies building the components required for end-to-end customer data collection and utilization. Once the data from our in-store, online, and IoT (see headless below) is aggregated, the opportunity to deliver something closer to the promise of omnichannel becomes real. NRF 2020 showed real promise in terms of the event focus, the technology featured, and the exciting time ahead for retailers.
3. Experience is everything. Experience isn’t exactly a brand-new idea, but it is something that has evolved from idea to execution tremendously in the past 24 months. The idea that consumers are driven by experiences is pushing the limits of retailers everywhere. Bringing the store into our homes, and our homes into the store is realized in the way companies are looking to enable experiences. Companies like Peloton and Casper are betting big on winning consumers through making expensive consumer products accessible, reducing barriers to entry through payment programs and risk-free trials while concurrently investing in brick and mortar by developing experience centers that allow customers that want to touch and feel before purchasing to walk into an experience center and buy the product. My business partner was asking around for feedback on the new Peloton Tread treadmill just today. I can promise you that if there was an experience center relatively nearby where she could walk in and see the product, that $4,500 purchase would be a done deal. This is a smart move on the part of brands, especially brands with premium products (like Peloton and Casper). I predict we’ll see even more focus on experience, and brands more closely connecting with consumers in innovative ways, moving forward.
4. Our Devices Power What is Next. I saw countless demos that suggested the power of our typical devices for both the workforce and the consumer. Samsung launched a new device called the XCover Pro at NRF 2020, which was essentially a ruggedized Android device that would replace the scanners and handheld devices typically used in retail. This device could be shared or used by an employee and even had programmable buttons that enabled employees to use Microsoft Teams as the retail floor and warehouse operations platform using voice and chat. A sign of what is to come is a whole lot more typical Android or iOS devices used to manage retail workers on the floor.
I also saw a plethora of new “scan” applications that could run on mobile devices that had augmented reality layers for inventory count and order management. Digimarc caught my eye with its digital watermark technology that enabled consumer product boxes to have a unique watermark that replaces the UPC but is completely traceable. Using a mobile device, each unit could be scanned, and this could also work on the pages of a catalog or flyer; bringing the shopping experience from the home to the store and vice versa.
For consumers, the use of devices for AR also had some pretty interesting applications. I spent some time with an application built by Scandit, and its tools work for retail employees, but also have very cool implications for customers. For instance, scanning a wall of wine bottles with your smartphone camera you can instantly see ratings, compare bottles and even add items to your cart. This technology isn’t brand new, but it is making massive improvements and should find its way into most consumers’ experiences in 2020.
5. Headless commerce is hot. If you haven’t heard of headless commerce, that doesn’t mean you haven’t experienced it. At NRF 2020, there was a lot of talk about headless commerce and essentially this is because end-to-end commerce systems are complex and tend to be difficult to adapt to modern buying behavior. Consumers nowadays are becoming increasingly active in using voice-driven commerce via an IoT-powered device like Alexa. When you tell Alexa to purchase more Cliff Bars, you aren’t tapping into Amazon’s full commerce engine, you are tapping into “headless commerce.” What happens in this process is that an API call is made between the device and the application layer, which then processes the order. In turn, the commerce system can make an API call back to the application layer to ultimately update with status. This is how many “Buy Now” functions work, and not just for Amazon, but think of things like Grub Hub or Hotels.com. This type of seamless experience without complex end-to-end commerce system development is driving a massive shift in the speed of experience to fulfillment and it makes it possible for retailers to focus more on the user-facing experience without having to worry about dealing with the cumbersome nature of the back-end ERP.
6. NRF is a Tech Show. From the moment you hit the floor, no matter which way you walked onto the show floor, the booths at NRF 2020 were dominated by big tech. And if you just look through the above-mentioned NRF trends, it really quite obvious that NRF is without question a technology show. From the keynotes to the booths to the media coverage, all the excitement around the event focused on how technology is transforming the retail experience. And it is, in a big way, whether via new technology that empowers a more immersive customer experience or an analytics tool that gives retailers greater customer insights that can be tailored in real-time to drive personalization or in-the-moment offers that inspire customer engagement.
Retail is very much alive and well. Although it isn’t the same as we may remember it, that’s fine. In fact, it’s better than fine—there is nothing wrong with progress. With experiences continuing to gain momentum, and traditional commodity retail being marginalized, the future will belong to the retailers that prioritize experiences in the store, online, and everywhere in between. The most exciting thing is to see that with technology, this is truly becoming possible.
Futurum Research provides industry research and analysis. These columns are for educational purposes only and should not be considered in any way investment advice.
The original version of this article was first published on Forbes.
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