Experiencing the Future of Retail at NRF 2023
Our key takeaways from Retail’s Big Show
US Retail Landscape
Retail in the US has always been about grandeur: big stores, big events, big consumption and big promotions. The United States is known for its love of big things, and there are various factors contributing to this, from culture to economic and historical factors to its abundance of resources, which always act as a catalyst towards an underlying emphasis on capitalism and consumerism.
The National Retail Federation (NRF) carries that core American retail DNA. The Big Show promoted by the NRF is spread across a colossal 300,000 sq.ft at the Jacob K. Javits Convention Centre in New York City. It is probably one of the biggest convention centres on the planet.
The theme of NRF 2023: Break Through
After the struggles and restrictions of the pandemic, the concept of breaking through is appropriate.
The NRF Expo brings together retailers and industry experts every year to discuss the latest trends and technologies in the retail industry. Retail’s Big Show this time witnessed a huge turnout of more than 35,000 people with numerous companies from across the world sending their complete teams to the event. The conference was filled with lively crowds, thought-provoking discussions, and groundbreaking technology, which left the retail community optimistic and energised.
John Furner welcomed and chaired the first session speaking about Walmart’s plan — “What will be going on this year is an intense focus on what customers are doing, what data we know about what they’re doing while they’re shopping, and how can we better serve them and take the friction out”. This statement resonated with everyone present at NRF. Customers’ shopping behaviour will be the key metric to track, and all the tech around it will be driving retail in the coming few years.
There were several discussions revolving around the landscape of the retail industry and what trends we’d be seeing in the future, especially after the recent slowdown due to the pandemic.
Industry leaders expressed a positive outlook towards the future of business post-pandemic. The gathering offered an upbeat and welcome message to all attendees, indicating that — “Retail is back on track.”
Fynd at NRF 2023
This year, our team here at Fynd was excited to attend the event as it was our first time connecting with global partners and clients to discuss their plans for the year ahead. We took time to understand the key trends and initiatives they are prioritising.
Although we had the chance to visit numerous stalls and engage with thousands of individuals from the retail industry, it is challenging to capture every perspective. Nonetheless, we have identified a few key elements that we believe will be pivotal moving forward.
Key Takeaways from NRF 2023
Two words that summarise the NRF Big Show: Unified Commerce and Experiential Retail.
1. Unified Commerce
The emphasis has been on transforming retail shopping into more of an experience than just the product. The term omnichannel has been at the centre of every retail discussion lately. The industry has since been on tenterhooks for years, waiting for the revolution promised by omnichannel retail.
We witnessed a significant change in the industry. The dream of omnichannel has now become a reality, with every company aiming to implement it. Those who have already reaped its benefits are eager to explore more advancements to enhance their customers’ experience.
Walking around at the event, you just couldn’t ignore how every other company was talking about omnichannel, endless aisle, automated checkout and more. But there has also been a small skip from the classic omnichannel implementation into something more complete — “Omnichannel 2.0” or “Unified Commerce”.
1.1 Unified Commerce Explained
In simple terms Unified Commerce is a strategy that centralises the data you’ve collected about customers and products on a single platform. It is an evolution of omnichannel , meaning that real-time data on products, customers, inventory, and more is shared across all channels (not just stores), giving customers a seamless and immersive experience. Brands that can deliver contextually relevant shopping experiences to customers wherever they are will be the ones who rule the roost in this ferociously competitive retail landscape.
How does it help?
- Viewing and updating stock in real time
- Reducing time spent on integrations
- Enhancing the point-of-sale system, which can improve customer satisfaction by providing faster and more convenient experiences
- Delivering quick and easy experiences and increasing customer satisfaction
- Managing the entire customer journey and accessing real-time customer insights from a single source of truth
Brands are now turning to unified commerce as the linchpin of their retail strategy, realising that it’s the only way to stay ahead of the curve.
Those who have already experienced the benefits of omnichannel are eager to explore additional features and improvements to enhance their customers’ experience.
1.2 Technology driving Unified Commerce
Exploring the exhibition halls, you just couldn’t ignore the number of firms displaying products which are part of the Unified Commerce and Omnichannel umbrella. The implementations of these suites of products are diverse in nature — right from an FMCG company, to a fashion store, electronics store or any other large format store.
Overall, these are the main products that come under Unified Commerce:
- Endless Aisle
- Mobile Point of Sale
- Self Checkout
- Clienteling
- Store Fulfilment
- Task Management
- Order Management System
- Consumer Shopping App
- Loyalty Points Enabler
While there were firms showcasing a whole suite of products, there were some that featured only one core product that they specialise in. These products don’t just solve customer problems. Since employees and managers now have easy access to all the information, they also help store managers and associates have a more confident interaction with customers on the go!
2. Experiential Retail
Experiential Retail is the core of the tech revolution at the store level. What defines experiential retail is a shift in retail strategy from focusing on just the product to the entire shopping experience.
At a brick-and-mortar store, you have the unique advantage of bringing people together in a way that cannot be replicated by websites or mobile apps. This presents an excellent opportunity to leverage your physical space to its fullest potential.
Experiential Retail is all about providing an:
- Intuitive and immersive experience
- Prioritising customer engagement more than just the transaction
- Leveraging experiences rather than the product
- Defying customer expectations
- Stimulating your customers’ senses
Brands used to focus solely on the product, but now the focus is on giving customers a shopping experience that exceeds their expectations. So when they walk out of a store now, it is with satisfaction from both the product and the experience of purchasing it!
Consumers are switching brands at unprecedented rates. Brands need to ensure strong availability, convey value, and provide a shopping experience that is unique, memorable, and not just a simple transaction. Experiential retail is at the helm of this construction which is getting built based on two strong pillars: interactive and immersive. It’s no longer about the product or sales — It's about experience and engagement.
Lot of kiosks showcased technology aimed at making the store an experience centre rather than just a place of transaction.
2.1 Personalisation and Customisation
Experiential retail is driving the change in trend from serving a “Customer” to serving an “Individual”. There has been a gradual increase in the use of technology in stores, transforming the way products are personalised. However, this trend has gained unprecedented momentum recently.
Stores need to be more interactive and provide experiences that are personal, customisable, and leave a lasting effect. This was something that was extremely evident with the kind of technology being showcased at NRF.
Several companies focused heavily on consumer personalisation, with easy-to-use apps that encouraged them to build their own designs. When a customer interacts with these applications, they feel like they have a deeper connection with the brand. These apps, backed by heavy printers, were able to deliver highly customised merchandise like T-shirts, shoes and more in just 15 minutes.
Imagine you walk into a retail store: All you have to do is pick out a t-shirt or a pair of sneakers, open the iPad, and put your design hat on!
Create and customise your designs the way you want — different coloured laces, get CR7/Jordan/your own name and number written on the back, add some patches here and there, submit it, and it’s done.
All the designs you’ve created on the app will become reality in no time. Wait for it to get printed, bill it, and walk out in a matter of minutes.
3. Innovation Lab and Start-up Zone
Another part of NRF that was gathering some buzz was the Innovation lab and Start-up zone. The ultimate destination for retail revolutionaries and tech enthusiasts alike. Around 50–60 companies were showcasing technology that was pushing the boundaries of what was possible in the retail-tech space.
From the enhanced possibilities of Web3 to the game-changing potential of supply chain transparency and accuracy, from the awe-inspiring spectacle of robotics to the remarkable concept of digital twins, the Innovation Lab was a true showcase of what the future of retail could look like.
3.1 Live Streaming Shopping Platform
Video is set to reign supreme, and innovative livestream shopping platforms are leading the charge. Live shopping apps allow consumers to view and shop in realtime.
These apps can be used in a variety of ways like:
- A shopping portal to order items
- A way to socialise with friends and family while shopping
- Some live shopping apps also allow customers to share pictures and reviews of their shopping experiences
Several companies were focusing on direct-to-consumer sales and also white labelling their solutions for different brands. These platforms are set to revolutionise the way customers shop and create a truly interactive and engaging experience that keeps them coming back for more.
The global live-streaming market size grew from $1.24 billion in 2022 to $1.49 billion in 2023.
3.2 AI-powered Applied Mathematics Algorithms
Retail companies are leveraging AI-powered mathematical algorithms to revitalise their assortment strategy simulations, demand planning, and supply chain optimisation.
With the ability to process vast amounts of data generated by modern supply chains, AI can forecast unexpected events like weather conditions, transportation delays, and inventory shortages with unparalleled accuracy. This technology has become a cornerstone of many firms and they have embraced it in large numbers.
3.3 Virtual try-on technology
A common problem shoppers face is the product not living up to their expectations. There have been many instances when you order a product thinking it would look great on you, but it ends up looking completely different than what you imagined.
The ability to try before you buy would put a dent in this massive problem. Equipped with 3D body measurement abilities, virtual try-on technologies, and cutting-edge smart garments, these products are revolutionising the retail industry.
Based on the trends at NRF, this is divided into two parts:
3.3.1 Virtual Fitting Room
The Virtual Fashion Mirror, also known as a Virtual Fitting Room, can determine a person’s shape and then overlap them with virtual clothing. With the help of big screens, the customer is able to see the entire look on themselves, measure the fit, and decide on their purchase.
This way, you can collect client feedback and allows people to share their experiences on social media while also marketing your goods. You do all this while giving customers their privacy while they explore options like ordering their items and getting them dropped off at the trial room itself.
3.3.2 AI-Powered Image Processing
Similar to a Virtual Fitting Room, AI-powered image processing and mobile interaction have made it possible to try on outfits in store without needing to physically use a changing room.
This innovative technology also benefits store associates by freeing them up from mundane tasks like stocking and folding, allowing them to provide personalised styling advice to customers. In addition, the system reduces the need for an excess inventory that takes up valuable floor space, including different colours and sizes of the same garment.
3.4 AI and AR-Powered Beauty Tech
The use of technology in the beauty industry has grown exponentially with the incorporation of the latest advancements and innovations. Beauty-tech solutions powered by AI and AR are generating significant interest in the industry.
Using AI also reduces unnecessary product and packaging waste, which eliminates the need for in-store testers. These solutions are transforming the brand experience across all customer touchpoints, enabling retailers to provide a more personalised and engaging shopping experience.
This technology has the capability to:
- Help customers understand their skin type
- Give accurate skin reports and product recommendations
- Realistic makeup makeovers and beauty effects
3.5 AI-powered Customer Profiling
Businesses can gain more extensive insights into their customers’ demographics, preferences, expectations, and behaviour using AI-powered product customer profiling.
It is powered by facial recognition software installed in CCTV cameras that can accurately identify and collect data on walk-in shoppers. Gender, ethnicity, age, dressing style, travel patterns, affinity towards different products, purchase patterns, etc. can be tracked.
This technology is even capable of detecting customer emotions, creating comprehensive customer profiles, generating heatmaps to pinpoint popular areas of the store, and providing many other insights. This information enables brands to easily identify, segment, and define their target audience, providing them with the ability to deliver personalised experiences that better meet their customers’ needs and expectations.
Its benefits include:
- Developing tailored communication channels to connect with customers on a personal level
- Enhancing customer satisfaction and loyalty by improving their overall experience
- Utilising resources effectively to boost customer engagement and retention
- Attracting new customers by leveraging high-performing customer profiles
3.6 Product Locator
Major retailers such as Ikea, Walmart, and Home Depot have rapidly embraced product locator systems, although the extent of their comprehensiveness varies significantly.
While some systems may offer users only a rough idea of where to find a product (such as directing a search for “towels” to the bathroom department), others may feature advanced indoor maps and navigation interfaces, guiding users to their desired product with pinpoint accuracy. This can be used either on the consumer application or via interactive screens at the store.
What Retailers Can Learn From This Year’s Theme
Coming back to the theme of this year’s Retail’s Big Show, Break Through highlights the many ways that retailers can stand out from the crowd.
Breaking through can mean different things, such as:
- Breaking through the traditional transactions and moving toward Omnichannel and Unified Commerce
- Breaking through the complexity of supply chain to ensure timely delivery of products to store shelves and customers’ doors
- Breaking through from obsolete ways of solving issues to technology-agnostic ways of implementation
- Breaking through the mindset of treating a segment of customers equally to providing a more individualised experience
According to a study, The Tech Effect: Strengthening the Omnichannel to Meet Consumer Demands — 61% of consumers will continue to patronise brands that offer the fastest delivery, while 66% expect to track their deliveries at all times. Additionally, half of all consumers prefer retailers that provide a personalised shopping experience. Given the intense competition, plethora of choices, and abundant information available to consumers, retailers that offer personalisation are more likely to earn customer loyalty.
Some Final Thoughts
Overall, the event was highly informative, highlighting a significant shift towards personalisation and valuing individuals as unique, rather than simply as customers. This will potentially transform how we serve our customers, and technology will play a key role in enabling it.
However, it’s crucial not to overlook the importance of employees. Guest speakers from various brands stressed the need to make store associates brand ambassadors by addressing their concerns and ensuring they deliver the best customer experience. Employees will always be the best brand ambassadors since no one can convey their brand to the customer better than them.
Heading back home with invaluable insights
The 3-day event ended on a high note with people gathering to un-wind together and have an in-formal discussion on the future of retail and how various companies are scoping things out. It gave us a good opportunity to speak to different brand representatives.
Consumer centricity and the adoption of tech to ensure how do we best serve the Individual was the central talking point.
At Fynd, we are already committed to this approach and have been working with more than 3,000 stores across luxury, mass, and premium brands through our in-store omnichannel application, Fynd Store. Additionally, we are actively pursuing our goal of unified commerce by developing products for stores, such as Endless Aisle, Mobile POS, Self-Checkout, Distance Selling Solutions, and much more.
For more information about these products and our mission, please feel free to check out www.fynd.com
