NRF’s Big Show: Why Are These Retailers Smiling?
The 35,000 retailers and retail professionals descending on New York City today are arriving with a spring in their step that must feel strange after recent years of dragging into town after a disheartening holiday season.
That’s not say that the National Retail Federation’s annual convention couldn’t produce something of an in memoriam segment ala the Oscars: Sears, Toys R Us, hhgreg, American Apparel, Wet Seal, Radio Shack, Payless, Bebe and others closed hundreds of stores or closed altogether. Retail Apocalypse became a buzz phrase.
But another storyline gained momentum leading up to NRF’s Big Show, too. Retail isn’t dying; it’s changing — maybe a little too fast for some of the participants. But nimble players will survive and the most nimble will prosper by shrinking stores, by transforming stores, by knocking e-commerce out of the park or by some combination.
Holiday sales were the best they’ve been in six years. E-Commerce continues to thrive, up 18.1 percent year-over-year during the holidays, according to Mastercard. Walmart is raising its starting pay and issuing bonuses to front-line workers, while stock analysts are becoming more bullish on retail amid a tax-overhaul windfall.
So why not a little spring in retailers’ steps? Early 2018 is a time to look ahead. By and large that’s what the convention warriors scrambling around the Jacob K. Javits Convention Center will be doing.
They’ll attend sessions with titles like “Robotics and AI: trailblazing technology for future retail” and “The what and how of digital transformation: three consumer expectations to meet now.” And they’ll careen through massive exhibit halls packed with more than 600 vendors selling virtual reality, augmented reality, just-in-time inventory insights and just about anything that comes with the words “artificial intelligence” attached.
Customer experience is moving to the back end of e-commerce
Software provider Zynstra recently released a report that found that more than half of retailers surveyed said using technology to improve their customers’ experiences would be a key 2018 focus. Sure, the customer experience refrain is a constant one, but the focus appears to be broadening to more extensively include the back-end experience — the experience provided after a customer clicks the buy button.
All the old favorites among topics will be at NRF: omnichannel, mobile, personalization, BOPIS, POS, etc. But the idea of turning to technology to create a smooth experience for consumers as an e-commerce system grinds through payments, order management, inventory insights, fraud management, picking and packing, delivery, customer support and returns, will be on the agenda as well.
In fact, the Zynstra research found that 44 percent of the retailers surveyed said they’d be turning to tech solutions in 2018 to improve their operations, a category largely focused on what happens after a customer buys.
In the age of Amazon it has become more apparent that building the best customer experience on the front end, with killer marketing and merchandising, means little if you drop the ball after the purchase.
Brian Beck, of retail consultancy Guidance, said online merchants need look no farther than Amazon for inspiration.
“They do a great job of personalization, meeting and beating expectations across the entire customer experience, including post-purchase,” Beck said when I spoke to him in the fall. “They have a real competitive advantage when it comes to last-mile fulfillment, order processing quickly, efficiently, getting through fraud screening, getting through all those pieces really quickly, so that the customer, when they actually receive the package, it beats their expectations. The whole post-purchase experience, Amazon recognizes, is critical for success.”
The mass of merchants in Manhattan this week recognize that too. But this year, it’s possible that they’re looking at that truth differently. Recent successes in the retail sector are fuel for optimism. The high bar that Amazon has set is not something to be feared. Rather it’s an opportunity to be seized.
And it’s possible that the answers for how to do that can be found in a cavernous convention center on New York’s west side.
Mike Cassidy can be reached at firstname.lastname@example.org; follow him on Twitter at @mikecassidy.