Our Head of Digital Strategy, Stephen Gillespie, tells us what caught his eye at this year's National Retail Federation's Big Show 2019 in NYC.

New York is an incredibly vibrant city and I always find spending time there exhilarating. The sheer size of the market and the intense competition for consumer attention in the key retail districts is mind-boggling.

This week was no exception as I discovered when I spent a few days with my Made to Engage colleagues at NRF 2019 Retail’s Big Show, a three-day annual industry event that brings together the biggest brands and names in retail.

Retail is going through a challenging time on Main Street America and on the UK and Irish High Street, so it was fascinating to take the temperature of innovation in one of the most advanced retail economies on the planet.

The Future of Omnichannel 

On both sides of the Atlantic, traditional retail is being tested. Pure play e-commerce has a lower cost base than its traditional competition, however, it is no secret that the advantage that bricks and mortar retailers have is the opportunity to deliver an experiential experience. We're now seeing a distinct migration as online players are moving into physical retail spaces to deliver a more immersive and engaging experience.



The blurring of lines between online and offline has long been classified under the heading ‘omnichannel’. The consensus at NRF is that the term ‘omnichannel’ only has 12-18 months to run before we see the expectation that omnichannel is just ‘retail’.

US department store Nordstrom told us that they are so acutely aware of the online activity of their customers before coming in-store that they are now seeing, in experience planning terms, their website as the new storefront door.

Enhancing The Customer Experience

The days of seeing the online channel as a store on its own, sitting alongside the offline properties are clearly over. There was much talk of BOPIS (Buy-Online-Pickup-In-Store) being the expectation now, not the exception. Many speakers at the event outlined their successful strategies for innovating within the ‘global customer experience’ to remove friction and improve the overall experience of shoppers.

There was lots of innovation in this space on display, such as approaches to Click & Collect that involve incorporating infrastructure like lockers into retail premises. A large pizza chain is currently installing heated lockers in stores so customers collecting food pre-ordered online do not have to receive cold food. And many retailers plan to incorporate personalised recommendations across a blend of digital and physical retail experiences.

Retailers in the US are making great efforts to digitally enable their associates, ensuring that they can best communicate their offering. It is an experience fail if a consumer is able to understand more about product details and stock levels on their connected device than the associate in store. Ensuring that associates have access and control at their fingertips, without having to go back to the stock room or ring the distribution centre, is vital - and we see key parallels with the work we're doing for our clients developing relationship management features.

Using Data To Drive Efficiency

At the core of this innovation is data and this is where we have to be careful as there is a slightly different approach to attributing data in European and markets that for now remain part of the European community.



With our data protection legislation, a blanket approach to harvesting data would be less appropriate. However, there were retailers present who used a very targeted approach to data. I was particularly impressed with some learnings from niche shirt retailer UNTUCKit who have moved from online-only to having 50 physical stores in the US in just two years. Their approach used quantitative data and supplemented this with regular customer insight programmes to define a strategy around innovation. While there is the potential to measure everything, targeting what to measure, having a clear understanding of the direction and measuring to feed the requirement for innovation is potentially a more realistic approach for our market.

The speed of innovation was also a key outtake. Fashion company Mexx suggested that there’s no patience for a two-year innovation project. Activities like this create project fatigue. A greater benefit can be achieved when insights can be capitalised on quickly so orientation around speed to market is incredibly important. It helps to create strong, connected teams aligned around a clear set of objectives.

A Friction-less Future

Although Amazon was not displaying its frictionless stores at NRF, a high number of vendors were displaying similar concepts - restricted entry spaces with access achieved through the tap of a mobile device. The space is mapped with cameras so that any item can simply be picked up, assigned to a specific consumer and then billed at the exit. While it appears there are plans to roll out the original Amazon stores in the UK, I can also foresee opportunities where innovative incumbents would benefit from a small-scale frictionless outlet where consumer motivation to consume is high. A book vendor at a transport hub serving commuters needing a bestseller to break a long journey. Or equally, at a large air show where diecast models of the aircraft on display would be of huge interest to visitors.

The sheer ubiquitous nature of these technology solutions at the show indicates that it’s only a matter of time before we see investment in this tech on this side of the Atlantic. Indeed, if your strategy involves finding opportunities to engage with consumers about books, a small outlet no bigger than a domestic fridge containing this week’s best sellers and utilising frictionless tech would be an interesting innovation project to access ROI. 

Continuing to Innovate

Innovation was on display in every corner of the vast Javits exhibition space in NYC. At Made to Engage we're privileged to work with what we call 'innovative incumbents' - sector-leading organisations with a keen desire to use technology in new ways to achieve their business goals.
 
NRF in 2019 taught us, if we didn't already know, that innovation in the sector is not just a constant but an essential. We’re looking forward to sharing more of our experience with our clients and prospective clients over the next few weeks and across 2019.

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

 

Stephen Gillespie
Stephen Gillespie Head of Digital Strategy Stephen leads our Digital Strategy division, empowering and integrating customer experience design with advanced technology development to deliver successful customer engagement.

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