Every year, IDC participates at the Annual Retail Big Show & EXPO, organized by the National Retail Federation (NRF) that sets the scene of retail for the following 12 months and beyond.
This year, the Retail Big Show allowed participants to reimagine their businesses and set the values of the new decade.
As evidence of the fact that we are in the age of commerce everywhere, we clearly saw how retailers are “blurring the lines” in many domains of their business models, moving from channels to multiple interfaces for a unified business logic. The blurring is happening between business objectives and social responsibility, online and in-store customer journeys, collaboration between retailers and CPG companies, and employees’ and customers’ experience.
This trend has been clearly reflected in some of the most recurrent words that we have collected and discussed over the course of three intense days at the show.
How Retailers Are Innovating
Business = Social Responsibility
#1. Sustainability
Sustainable production and the circular economy inspire retailers and CPG companies to rethink the supply chain, the customer relationship, and how technology can effectively impact on the wellbeing of the planet. Many companies have launched initiatives and partnerships to reduce the usage of plastic and C02 emissions, promote circularity (H&M) and recycling (Adidas), and focus on health and safety.
Customer Experience = Employee Experience
#2. Workforce
Enhancing employees’ experience through delivering a better customer experience is a must-have for retailers. By 2023, 65% of Top Global 250 Retailers Will Have a Digital Workforce Lifelong Learning Strategy in Place, Enabling up to 20% Increase in Employee Retention.
Store associates, for instance, very often interact with customers through new and smart devices. Tech enablement, training (digital academy), talent rewards, agility, and collaboration are among the main factors that foster retailers to reinvest in the workforce and increase overall employee satisfaction and loyalty in the long term.
Online Customer Journey = In-store Customer Journey
#3. Real-time store
The connected store consists of integrated in-store and online devices and interfaces to improve real-time contextual customer experience. Retailers are re-imagining the store format and organization to offer a more interactive digital environment, fostering collaboration with potential partners (e.g., Amazon lockers, Nordstrom Local, and Rent the Runway).
#4. AI
AI remains foundational when implementing a retail commerce platform to enable its core capabilities — commerce services, customer experience, fulfilment services, content optimization services. It is essential that AI is embedded within the platform core capabilities. This allows optimization and automation in real-time operations across all available interfaces — including the store.
#5. Mobile
More and more retailers are adopting a mobile-first approach to accurately track and cater to individuals in real-time and deliver effective contextual customer experience. Retailers that are investing in mobile capabilities can offer better and more efficient purchase experiences (i.e., frictionless in-store location, searching products via images and voice assistants, providing user-generated content and personalized promotions).
Also, they can easily recognize whether clients are online or in the store (merging customers’ online and offline journeys) and enable store associates to better perform in assisting clients in-store and having an updated outlook on product availability (i.e., inventory visibility).
Innovation = Business Model
#6. Business Model Innovation
It is evident how most retailers, CPG companies, IT vendors, systems integrators and consulting companies are changing their perspective on the meaning of the term “innovation”. Up to the past couple of years, the retail community was mostly looking at innovation as “shiny point-solutions” that were opportunistically added to existing IT systems.
Retailers have become aware that it all starts from innovation culture. Major retailers are blurring the lines between IT and business departments to define an enterprisewide innovation strategy and execute it at speed and at scale.
#7. Direct-to-consumer
Lines between retailers and CPG companies are blurring as well. There is an increased effort in direct to consumer strategies to reach customers more efficiently and effectively. Internal and external data silos are being taken down, boosting collaboration opportunities (e.g., Nike and Foot Locker).