Anyone what has ever attended NRF’s Big Show (that’s us!) knows that it is the must-attend event for those in the retail technology space. This year should be another one for the record books as the Big Show takes over every square foot of the Jacob Javits Center.
In preparation for this year’s convention, Paula Rosenblum wrote a great article on Forbes outlining the top five retail technology trends she expects to see front an center this year.
#1: Technology to improve the customer experience in stores. Real estate is retailers’ biggest expense but sales and traffic growth to stores have been slowing as consumers continue their inexorable move on-line. It’s true that close to 90% of sales still consummate in stores but many shoppers ask themselves “Why should I take the time and trouble to go to a store, when I can just buy what I want on line?” This fact is not lost on retailers and they are continually searching for ways to create a more compelling in-store experience without breaking the bank on costs. After all, you can’t just say “Never mind” and close your stores. Leases were not meant to be broken. The store must go on.
#2: Cross-channel Order Fulfillment. We live in a world of instant gratification. If a retailer is offering something for sale, a shopper rightfully expects she can have that thing. Now. She doesn’t really care that the product she wants is in a different store, or that it’s in a warehouse on the other side of the country. By offering a product up for sale, a retailer makes an implicit promise – that the item is available for sale. In the old days, store employees would call ‘round to other stores to find out if they had a particular product in stock. That works, but it’s not very efficient. Retailers will be buying technology to make good on those implicit promises without spending valuable employee time or money. I expect this technology to be a hot topic at the Big Show. The industry buzzword for the concept is “omni-channel fulfillment,” but we know the customer doesn’t care about buzzwords. She just wants what she wants. It’s pretty simple, really. Well, it’s easy to say at least, but not so easy to do.
#3: Promotion and Price Optimization. Unless you’ve been vacationing on Mars , you know that retailers have gotten more and more promotional – especially around the holiday season. In fact, I had the opportunity to appear on a Russian TV news show this year to talk about Black Friday weekend and associated sales. Yes, Russia. The whole world is watching. It’s the Superbowl of shopping. Historically, these promotions have been a bit of a game of “chicken” between retailers and shoppers. Each waits for the other to blink. But the expansion of Black Friday madness has altered the power dynamic. The consumer is totally in the driver’s seat. Retailers will be looking at technology to help them find the most effective promotional and end-of-season prices.
#4: Big Data and Predictive Analytics: This is a very broad topic and it seems everyone’s talking about it. “Big data” has become a catch-all phrase to cover most everything, but in retail it seems to be settling in to refer to information available on shoppers and consumers in general. Things like their paths to purchase, their product reviews, reports from social media…information that wasn’t available before the internet, smart phones and social media. Predictive analytics are designed to help retailers buy more precisely so they can sell more intelligently. It’s a subject that’s been given a bad rap in the media, but really has no nefarious notion behind it. It’s just retailers’ attempt to do a better job of being…retailers.
#5: Data Security: Honestly, this wouldn’t have been very high on my radar screen three weeks ago, but the Target TGT -0.39% data breach has gotten a far more negative consumer response than anyone expected. I’m not sure if it was the somewhat odd way Target and the banks handled the matter – I still don’t understand why the banks and Target didn’t just issue new cards and get them into consumers’ hands. December 15 is probably the quietest time in the holiday season…it could have been all over by December 17. There is clearly something I’m missing here – or if the combination of NSA surveillance coupled with lack of security is a final straw for many. In any case, the very surprising blow-back is going to re-focus retailers’ attention, all the way up to the Executive Suite, on improving security.