Trip Report: The NRF Big Show 2016
Every January the National Retail Federation hosts the retail industry’s biggest tradeshow of the year, aptly called “The Big Show” at the Javits Center in New York City. Thousands of retailers, technology vendors, and supply chain professionals provide thought leadership on the current and proposed future state of the industry. The quantity and quality of powerful presentations is massive, but there were pervailing themes that resonated throughout. Here are a few trends and takeaways I honed in on.
Is Omni-Channel on the Way Out?
Omni-channel has been a pervasive challenge for the retail industry for many years now. With customers shopping in new and varied ways, retailers are having to prepare their operations to meet demand, and the term has certainly become a buzzword. However, in nearly every session I attended at this year’s NRF, the retailers moved away from the term. The basic theme was that the customer is the channel. The resounding message is that what matters is finding the best approach to engage the customer and improve their overall experience. In the same vein, Healy Cypher of Oak Labs noted that omni-channel is a business problem, not necessarily a technology one. Customers who are doing it well are getting at the core of the challenge, what factors are at play and what they need to overcome, which is guiding how they utilize their preferred technology systems.
Cross-Functional Teams a Key to Success
During his session, Fred Argir, Chief Digital Officer from Barnes & Noble and Nook, stressed the importance of getting to know a process by living it. Often, internal teams operate in silos, which makes it extremely difficult to align objectives and to understand the implications of a certain strategic decision and how difficult and time-consuming various internal processes truly are. By bringing the internal constituents together it’s easier to get an enterprise-wide view of where the company is going, what challenges are being faced and develop strategic goals and objectives.
Data Remains a Key Differentiator
Finding and correctly utilizing data was a reoccurring trend throughout several sessions. CEO of Williams-Sonoma Jan Hayes was quoted as saying that “Data analytics is what puts us ahead of other home furnishings retailers.” But due to the overwhelming wealth of data and complexity in distilling it and using it, data can be intimidating to retailers. Malcolm Goonetileke, Levi’s SVP of Global Merchandise Planning and Inventory Management, noted that they are actively seeking talent who can find the story behind the data to drive decisions and be willing to take risks. However, Terradata offered a good point, stating in their session that you don’t need your data to be 100 percent perfect in order to get started. There are plenty of good insights that can be gleaned from existing data as you get up and running with a more sophisticated data system. IBM noted that more and more companies are including advanced analytics into the network design process. In fact, several are using data to develop hyper-localized offerings including incorporating weather events and microeconomics to drive predictive analytics.
The Customer is #1
This won’t be changing anytime soon and was echoed in nearly every session and every conversation I had at the event. Customer satisfaction is imperative in this age of consumer choice. This was a key piece in an IBM research session I attended. They projected that retail stores will be increasingly used as showrooms and stores associates will be elevated to concierge status. They will be expected to hold in-depth knowledge about various product lines and answer customer questions in detail, with lesser transactional focus. The stores that will thrive in this changing environment will have associates that are engaged, enabled, educated and empowered. But processes behind the scenes can also have extraordinary impact. In their session Royal Caribbean mentioned that inventory accuracy is often taken for granted, despite its impact on the overall ability to meet customer demand. But they also raised an interesting point: when evaluating a change in strategy to meet service levels, organizations should have a good sense of what they are netting from hitting said service levels as they could be acquiring unnecessary costs for what is resulting in minimal benefit.
“The Big Show” was just that in 2016 and reflects what an exciting time it is to work in the retail industry.
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