After visiting NRF 2019: Retail's Big Show in NYC, Made to Engage MD Steven Cassin reports on the key innovations that are helping household brands and industry incumbents stem the flow towards online giants and disruptors to create a retail resurgence with outstanding customer experiences. 

Over the last 20 years, we’ve witnessed a radical transformation in consumer behaviour and shopping habits all over the world. In recent years, we've witnessed a challenging environment for the retail industry become a devastating one for many, with store closures and profit warnings a common morning news bite.

We’ve seen a continued acceleration toward the ultra-dominant digital platforms of search and merchandising in Google and Amazon respectively. The dominance of the Google SERP on Black Friday has become a sport for major players, while Amazon owned over 50% of the total growth in e-commerce in the US in 2017/18 holiday season and is expected to account for 50% of total ecommerce spend in 2018.

Retail Leaders Take a Stand

So what are the retail industry and the leading technologies doing about this? Myself and two colleagues from Made to Engage, ventured to a beyond chilly NYC in early January 2019 to gauge how well we are performing against those efforts in partnership with our clients at NRF’s Big Show 2019 – the world’s leading retail conference, attended by almost 40,000 people focusing on retail tech, strategy leadership and more.

Attending an array of keynotes, fireside and panellist discussions and workshops, we absorbed a huge amount of content, viewpoints and ideas from inspirational retail and brand leaders from household brands such as IKEA, Macy’s, Nordstrom, Home Depot, B&Q / Screwfix, Alibaba, Subway and many more. We also connected with many startups and disruptors making their own dent within the space. In all cases, we saw a passionate group of leaders challenging their industry peers and partners to strive for more and better, for innovation and vision which would re-imagine retail and commerce.

What we found was an industry fully aware of the challenge ahead of them and the willingness to take it on. For many, that meant taking the game to the most notable absentee in Amazon Retail by maximising the value of what could be both their trump card and biggest liability – their retail real estate, infrastructure and customer base.

Those retailers who were leading the fight were those who had gained or partnered for digital talent, combining online acumen with leveraging physical locations to deliver exceptional customer experience across channels. A key challenge for many was effective Buy Online, Pick Up in Store (or Click and Collect as we call it this side of the pond) but it goes much further than this. It was those stores that blurred the lines between digital and in-store experience that seemed to be winning. As might be expected, those who could meet the customer on their own terms, serve them as they want to be served and delighted customers with innovative service enhancements were telling the story of positive revenue and customer loyalty and satisfaction scores.

Home Depot installed BOPIS (Buy Online Pickup in Store) lockers providing convenience, reducing cost and reducing theft of deliveries.

47 percent of all orders placed on Home Depot’s website are fulfilled either via BOPIS or BOSS (Buy-Online-Ship-to-Store), said Matt Jones, senior director, digital strategy and mobile apps for Home Depot. “The customer is going to dictate to us how they want to shop,” he said, “and we as a company need to be able to respond to that and provide whatever type of option that is.”

20% of BOPIS customers went onto spend more on additional items when in store. The service has also reduced shipping costs for Home Depot, though it wouldn’t disclose how much.

Tech Players Showcase Their Wares

Many of the key tech players were also there to showcase their latest offerings and greatest successes. None moreso than our own partners Episerver, Avensia, In River and Microsoft who showcased their vision of the future of connected and unified commerce. We proudly watched on as Episerver showcased some of the innovations we developed in partnership with them and Microsoft in 2018 to some of the world’s leading brands.

Whilst many other speakers and tech brands urged us to focus on 1-1 Personalisation with AI, on big data visualisation and analytics, on VR and AR experiences, robots and drones for fulfilment a small number said it best for me.

Nordstrom Takes It Local

Edmond Mesrobian, CTO of Nordstrom refreshingly explained the current mantra of the classic American brand – “Customer Obsessed. Digitally Enabled.” In conversation with his Home Depot counterpart, Daniel Grider, Mesrobian delved a little deeper to explain how Nordstrom was effecting change.

Firstly, they had created localised customer engagement schemes which operated across the country to understand what their customers wanted from them, how they could serve them better and how they could gain their loyalty in return. He explained that he and his leadership colleagues often sat within these workshops and how one “Wouldn’t it be great if…” question from a loyal customer led to a proof of concept which has led to a nationwide rollout of “Nordstrom Neighbourhoods” – a local neighbourhood service which offers a new shopper experience which blends digital and physical worlds. Customers visit a neighbourhood store for a guided shopping experience using digital platforms to plan a homeware project or to refresh a winter wardrobe.

Customers are invited to create a project or dressing room in advance by snapping pictures of their living room or current wardrobe to enable a more informed personal shopping experience. In the case of clothing, the customer selects a subset of products which are shipped to the neighbourhood store within 24 hours. On their return, the customer will find a fitting room furnished with the chosen products and their advisor on hand to help them choose their preferred products.

This is no small feat and incorporates a huge range of technologies to support product catalogue, mobile shared browse, inventory and logistics, augmented reality to help visualise the purchase, CRM to support a full view of the customer and integration services to bring it all together, but this is a shopping experience – not a transaction. And this distinction is an important one which aligns with Nordstrom’s ethos and is integral in the battle against the likes of Amazon.

Urban Decay Engages with Interactive Content Experiences

Of course, outstanding and valuable customer experience doesn’t necessarily require huge physical infrastructure across the country. Another success story caught my eye. Urban Decay, a brand built on a promise of “beauty with an edge” this eye makeup brand has used rich content experiences and a global partner network to engage and deliver for its audiences.

For those who’ve listened, I’ve long extolled the virtues of rich, imaginative content and commerce experiences which connect with audiences and deliver for the business for a long time. Urban Decay presented theirs. Whilst their main digital presence is by no means basic, it sticks mainly to the tried and tested product search, listing and detail format, one of its latest innovations has driven significant customer engagement, acquisition and revenue results.

UD All Access is a content hub which brings together brand, influencer and blogger content of all types. It was originally launched in 2016 but has undergone a makeover in recent months with a greater focus on richer and inspiring content building on fame culture to build a community of their own and monetising it through a range of shoppable content items including shoppable video.

Whilst this format is not for everyone or every brand, for those audiences with an engaged audience or community and varied product set, these UGC and Community plays may drive some real success. Two of our clients in Hornby Hobbies (and its subset brands) and Eason both match this criteria for differing reasons- something we have been exploring for some months. 

Leaders Create a Vision For Success

Whilst these examples of exceptional customer experience were exciting and interesting, the cumulative advice of a highly experienced panel of retail leaders with decades of combined experience resonated with me fully. These leaders from brands such as Mexx, SAP and Macy’s, like Mesrobian, advised that whilst tech was the essential enabler the key to success lay in an organisation’s leadership and specifically their ability and willingness to: 

  • Articulate a strong vision and pathway to success
  • Focus on Customer Experience seamlessly across all channels. Often the phrase Customer Obsessed arose. In all cases, these were linked to understanding and delivering greater value to their customers.
  • Create a culture of innovation, collaboration and agility which would support a highly engaged environment (for customers and colleagues) where ideas could form and be tested rapidly – for failure or rollout.

At Made to Engage, our vision is to empower the most ambitious organisations to achieve their digital success. We aim to do this by helping our clients envisage exceptional customer experiences which can transform their business, designing customer engagement strategies which add value to the customer and by knitting these together with the technologies and data which drive them.

We are delighted to work with a range of clients, in the retail and other sectors, who strive to innovate and lead. This is what motivates us to keep pushing the boundaries. This event provided huge supplies of oxygen to energise us further in 2019. See you next year NRF’s Big Show.

To learn more about our expertise and key trends in digital commerce, reserve a seat at our commerce summit in partnership with Microsoft below.

 

Steven Cassin
Steven Cassin Managing Director Steven leads Made to Engage, UK & Ireland's Episerver Partner of the Year and one of the fastest growing agencies in UK & Ireland, creating strateigies to enable ambitious organistions to achieve digital success.