GUEST ANALYSIS NRF 2016: A perspective on what’s hot and where we are heading
It might be happening on the other side of the pond, but the NRF Annual Convention and EXPO is an important conference for the UK too, and it certainly lived up to its moniker ‘Retail’s BIG Show’ this year. For those of us more concerned with increasing challenges of delivering the best online retail experience, there is still a great deal it offers. With more than 33,500 attendees and hundreds of sessions and exhibits, its pedigree as a unique ‘one-stop’ event showcasing the very latest thinking, technologies and solutions for Retail professionals was clearly in evidence.
There was a palpable excitement in the air as innovative retailers and brands demonstrated how, when it comes to fusing their digital and physical channels to create seamless social and immersive shopping experiences for customers, they are doing so much more than just ‘talking the talk’.
Many of the speakers at this year’s show talked about how collaboration is becoming the new competition. From big data to micro insights, a growing hunger was in evidence to share collective insights into shopper browsing habits, geo location and online data so that retailers can enhance the physical retail space or blend digital and physical shopping experiences in a unique way. That is pretty exciting in itself, but what else caught our eye?Physical or digital?
At the ‘Physical or Digital: The Choice is BOTH!’ keynote session, Sir Charlie Mayfield, chairman of John Lewis Retail, stated that the age of multichannel is over, urging retailers to integrate their offline and online channels completely to focus on the customer. As he put it, customers don’t think about ‘channels’, their expectation is for a unified, intuitive and personalised shopping experience – no matter where or how they interact or shop with a brand.Omni-channel coming to life
There was plenty of evidence at this year’s show that omni-channel as a concept is finally coming of age as digital and physical retail continues to converge. There was a renewed focus on customer-centricity – putting the customer, and not the channel, at the centre of the retail experience. For many retailers, this means the race is now on to enhance the customer experience using data-driven insights to build customer loyalty and engagement.
Examples of how retailers are responding to this imperative include a move to transform shopper data from loyalty programmes and past purchases into next product-to-buy analysis. And, with mobile taking an increasingly central role in commerce, there was a distinct buzz around innovative new personal shopper platforms and digital shopping assistants.
Capable of utilising predictive calculations of consumer needs – these enable a two-way conversation with consumers, gathering scores from catalogue items to ensure customers don’t miss out on items of potential interest. So, when a shopper says they’re looking for an outdoor walking jacket, they’re asked to specify where they’ll be visiting for their walking trip. The technology then undertakes a deep dive into the product catalogue, identifying the best jacket for their requirements based on analysis of the weather data relating to the customer’s intended trip location.Data is not king – analytics is
Retailers are also leveraging more data and analytics in their offline operations to better understand the increasingly complex, multi-channel shopper path to purchase and to track marketing effectiveness. With in-store technologies and analytics, like beacon technologies, WiFi, and proximity marketing, becoming more prevalent, retailers are no longer just leveraging these technologies to optimise operational efficiency or the in-store experience itself. They’re using the data generated to gain a greater understanding of shopper behaviours and the shopper journey to eliminate potential friction points.
Radically changing shopper demands means retailers are reinventing themselves as technology-led businesses where systems and data are becoming the primary enablers to creativity and innovation, especially when it comes to delivering a seamless and fully personalised experience in all channels.Our interactions are finally getting smarter
Reinvigorating the in-store and online shopping experience for today’s experience-hungry consumer is driving many retailers to engage in smarter interactions with shoppers. And it’s this ‘experience retailing’ that’s transforming the physical store as we know it. Today’s ‘destination store concept’ now aims to give shoppers an enriched, personal and highly sensory experience designed around their known shopping wants, needs and desires.
It’s a disruptive approach that requires brands and stores become more adaptable, more agile, more experimental and more responsive. In-store that means offering highly localised product assortments determined by a deep understanding of local customer demographics and shopping norms; a ‘brand flexing’ strategy that aims to generate maximum demand pull - and sales - on the shop floor.
And it’s clear that the deep synergy between individual bricks and mortar outlets and online sales is increasingly being acknowledged. At this year’s show, some trail blazing retailers demonstrated how they’re looking to leverage the positive customer sentiment generated by shoppers who encounter an in-store retail experience that delights them – and create demand pull for their digital channels too.
That might mean using in-store digital displays and technologies to extend the breadth of lines on display by showcasing ‘next aisle’ rather than endless aisle offerings – a carefully curated selection of options that complement physical product displays. Or using in-store mirror technologies that use facial recognition technologies to identify customers and offer personalised recommendations or access to their online ‘wish lists’ or browsing history to refine or streamline their in-store shopping activities. As one retailer put it, the opening of their latest flagship store generated an impressive 68% uplift in online sales in that region.So – where is it all taking us?
So, in summary, the key messages from this year’s NRF Big Show were: retailers need to be nimble, leveraging technology and analytics to stay ahead of the game and deploy new innovations that play to customer’s wants and needs. For some that means freeing data from silos and engaging in sharing data collectively with retail partners and product manufacturers to gain the micro insights that drive more personalised – and more hyper-localised – shopper experiences.Channie Mize, general manager for retail at Periscope. a McKinsey Solution.