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2021 marked the 110th year gathering of the National Retail Federation (NRF). As in years past, the event focused on the latest retail trends and the core issues impacting its 18,000 members. All attendees were able to safely enjoy the event, which featured a virtual version of the conference.
“As consumers shifted much of their shopping online, retailers expanded ecommerce capabilities and integrated them with in-store options - in many cases completing projects in a few months that previously would have taken years. State-of-the-art distribution and fulfillment centers were built to manage the influx of online orders, and innovations like curb side pickup, contactless payment, appointment shopping and virtual showrooms emerged to give consumers the ability to shop safely, however they wanted”. Mathew Shay, President and CEO, National Retail Federation (NRF)
The central theme of this year’s event was the future of retail, with many of the program’s 90 sessions and speakers touching upon the industry’s shift to digital platforms. Other speakers touched upon post-COVID recovery strategies for retailers and the blurring of the lines between physical and digital retail. This report highlighted some key takeaways from this year’s event.
Retailers Increase Focus on Supply Chain Efficiency:
“No matter where you are in the world, if you are out of stock, people are going to consider trying an alternate store. Some will wait for the items to be back in stock, but is that really a risk that you can take?... Think about what are you doing to really control and improve your supply chain as you walk along with your continuum for 2021” Rose Spicer, Head of Global Marketing, Oracle
Today’s consumers are ready to buy. But they are also ready to move on to a competitor if the retailer is unable to meet their immediate demands for products. Upon recognizing that supply chain disconnects were responsible for many shortcomings, proactive retailers turned to technology to improve their supply chain efficiency. With this trend expected to continue, we can expect to see an increase in supply chain technologies devoted to retailers.
Retailers run the risk of losing impatient buyers if they are unable to keep key products in stock. To help minimize this risk, retailers should focus onimproving in three key areas:
• Forecasting sales with greater accuracy
• Executing strategies to prevent supply chain in efficiencies
• Distributing inventory to house key products closer to consumers
Online Shopping is Skyrocketing
When the COVID-19 pandemic forced many brick and mortar store locations to shutter their doors, online shopping began to surge. Retailers with an established online shopping platform witnessed record sales numbers, with researchers expecting consumers to continue to shop online as 2021 unfolds. At the same time, many retailers that previously depended exclusively on brick and mortar store sales began to pivot by venturing into e-commerce sales.
Data Is More Important Than Ever
Data is the key for retailers seeking to achieve the next level of success. Top retailers are employing the latest cutting edge tools to gain insight into their customer’s shopping habits and adjust their sales and marketing strategies. On the other hand, failure to gather and analyze data from supply chain activities, online engagement, and sales trends is a recipe for stagnancy.
A Flawless Omnichannel
Experience is Key
A seamless shopping experience across channels is no longer an option for retailers seeking to lead their markets. As more retailers embrace software to collect data from multiple channels, top Software companies are taking steps to improve their omnichannel analytics platforms.As Omnichannel analytics platforms become more robust than even, retailers can prime themselves for sustained growth in the future.
The best data in the world becomes useless if it’s not properly organized and stored for reference. To make better use of their data, retail organizations are turning to retail specific loud initiatives to facilitate storage and utilization.
“Companies had three years of digital transformation on their roadmaps and those roadmaps got really condensed. All of a sudden, those digital transformation initiatives had to take place within a few weeks.” Anna Rose man, VP of Product Marketing,Salesforce
Since COVID-19’s emergence in march, over 40%of retail consumers have made the transition to digital shopping. Most of these buyers have warmed to online shopping, with many indicating they have no plans to shop at stores regularly as they did in the past. While online shoppers haven’t fully abandoned physical stores, their purchasing habits and preferences cannot be ignored. Many Online shoppers have a college education and jobs that net over $100,000 annually. With steady incomes and higher spending abilities, they welcome the opportunity to shop online and have their purchases delivered to their doors. In-store shoppers, on the other hand, tend to have lower incomes, placing a natural limit on their ability to spend money. The most successful retailers of the past year have picked up on these trends and made it their mission to embrace digital shopping channels.
“50% of consumers who always go to the same supermarket on their way home from work or what not, have shopped in a new way now. Likely they’ve had groceries delivered to their home. 4 in10 consumers in Europe have actually purchased something online for the first time that they’ve onlyever bought a physical brick and mortar store.”Shelley Brans ten, Corporate Vice President,Consumer Goods & Retail Industries, Microsoft
A decade or two ago, retailers’ biggest competitors were other retailers within their niche. For example, major competitors for Macy’s included Kohl’s, Dillard’s and Nord storm. While competition still exists among these brands, the competitive landscape has changed dramatically.Macy’s and other traditional department stores are now finding that their biggest competitor is the online marketplace. With more buyers turning to Amazon and other online retail giants, merchants must develop strategies to complete in a brick-and-mortar store environment and online.
Given this trend, it is no surprise that retailers who have turned to digital channels to sell their products outperformed businesses that were reluctant to embrace digital marketplaces since the first quarter of 2020. And with physical storefronts driving a smaller percentage of overall sales, retail companies need to adapt or run the risk of missing their revenue goals.
Research by PYMNTS shows that nearly 10% ofAmerican consumers have used voice to place an order for food or other products. While this trend may currently be in its infancy, PYMNTS data shows that nearly 40% of consumers would like to use voice in their shopping experiences. Here are few notable points that illustrate how voice is becoming a powerful commerce enabler:
• Voice saves time and is easier than clicking, swiping or typing
• Groceries and takeout food are the most common items orders using voice as the channel
• Consumer multi-tasking often lies behind the use of voice to order food, goods and services
“What everybody has seen is that the role of the store has certainly changed forever. It’s still going to be very important in the coming years, but you’ve seen a lot of retailers really quickly pivot and set up capabilities of curbside and in-store pick-up at a much bigger scale than they were contemplating before. So a lot of retailers are already thinking about how this changes design in the future?” Carrie Tharp, VP Retail and Consumer forGoogle Cloud
As we move forward into the 2020s, more consumers than ever are skipping the in-store shopping experience. To avoid hassles with parking, searching for products, and waiting inline, they simply order online and wait for their merchandise to appear on their front doorstep. Unfortunately, many retailers have yet to master the basics of the final mile of the shopping experience. Whether they struggle to make the in-store pickup experience fast and efficient, orare unable to deliver orders on time, retailers who miss the mark with the final phase of the shopping experience will begin to lose their market foothold.
Given the importance of positive final mile experience, proactive retailers are investing in logistics to get orders into the hands of buyers faster and more seamlessly. For example retailers are turning to third-party logistics (3PL) providers to handle their needs for storage, kitting, and delivery. Other retailers are exploring the use of delivery drones and robots to expedite deliveries.
Practical Example
With OMS Integration, Bayretail enables retailers to not only increase the efficiency of logistics, optimize order fulfillment, but also improve the customer experience.
COVID-19 has dramatically disrupted the industry, with the shock differing massively between brick-and-mortar versus pure players, essential versus non-essential stores, and small versus large retailers.
From supply chain integrity to frontline staff adaptability, the solutions and contingencies that were so rapidly pulled together will now form the basis of the “new normal”.
How can retail survive with no physical stores open or barely open?
Are pure players meant to replace Bricks and mortar businesses ?
How to build a Brand in a pandemic context?What does Customer Experience mean in theNew Normal landscape ?
Here some of the key findings and suggestions from Sebastien Zins, Area VP, Salesforce.
The capacity to adapt to new norms, becomes a matter of survival.
Retail makes no exceptions and Brands which will have the capacity to adapt their use cases, or customer experience will increase their chance to survive. This is known as ”Agility”. This is NOT just technology but Companies that carry the burden of a very complex IT system are reducing the chance to adapt. On top of Company culture& people mindset, Technology Platform solutions are made by design data flowing around theEnterprise and set them ready to adapt quickly and react to change.
In 2021, Digital is a must have. Brands did not wait for the Pandemic to launch digital stores & ecommerce websites... Companies really need to reinvent customer engagement. Raising KPIs such as the Customer Effort Score, illustrates that many companies now understand the importance of allowing to mix & match channels for making their Company easy to make business with.
Digital, and technology in general are playing a key role in this matter. For instance, augmented sellers, buy anywhere – return anywhere,Ship from store, eCommerce from store, Live streaming selling (mixing stores, marketing, and ecommerce)...
All these use cases and much more to invent are examples of use cases where physical & virtual come together.This leads to another key Business transformation...
How many Companies are still monitoringPhysical stores & eCommerce separately ?
In the New Normal landscape, it makes no sense to distinct physical stores and eCommerce Pnl’s. The new phygital experience aims to monitor online and physical stores together. Companies such as Oxybul Eveil & Jeux have already switched to 1 PnL for Retail as a whole.
We live in a world where offer clearly surpassesDemand. This puts a natural pressure on Brand differentiation. The pandemic is an incredible trend acceleration factor. It is the right time forRetail companies to rethink their brands.
To conclude the 2021 NRF edition, the retail experience has undergone a major transformation.Opportunities abound to boost shopper satisfaction through supply chain improvements, seamless digital channels, and a positive omnichannel experience. And by employing the latest tools to analyze consumer data, forward-thinking retailers are reaping the benefits of their journey down the online sales path. By adopting the trends outlined above, retailers will be positioned to thrive as the years unfolds.
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