The National Retail Federation’s big show – NRF 2020 – brought together retailers, brands, analysts and innovators at the #1 global retail event. It was the Big Show indeed – about 40,000 attendees from over 90 countries gathered in New York City in January to see over 800 exhibitors (including Dassault Systèmes’ CENTRIC PLM) and hear from 400 speakers across 175 sessions.
Major themes across the sessions, keynotes and analysts coalesced around five key drivers.
Frictionless omni-channel shopping
The customer is king more than ever before, turning “retail” into “me-tail,” shopping anywhere, anytime on any device, even mobile shopping in-store. It requires seamless integration between store and digital experience, connecting product and inventory information across all channels with visibility for the consumer.
A growing trend is shopping across channels and ordering for pick-up or delivery “my way.” Retailers are also looking towards facial recognition linked to CRM systems as they engage with customers at a physical store to provide premium service levels seamlessly.
The importance of meeting consumer expectations for fast shipping and easy returns leads to logistics challenges and the risk of higher costs. Customers want convenient, free or very low-cost options, while retailers balance encouraging in-store pick-up with piloting drones for last mile delivery to remote locations.
Physical store of the future
This challenge has two aspects – reimagining physical spaces and accelerating associate productivity. More stores are opening mini- and micro- physical locations in cities (including brands like IKEA, Nordstrom, Target). These smaller venues feature assortments curated by location, smaller inventories and more show-rooming.
Higher quality store displays often use AR/VR with interactive screens to show product information and beautiful 3D models. More experiential stores are happening (such as Nike, REI, Decathlon), more partnerships for shared space (such as Kohl’s, Aldi, Amazon) and kiosks for inventory pick-up. Retailers are looking to elevate BOPIS (Buy Online, Pickup In-Store), by far the most cost-effective approach for the retailer using kiosks with digital access.
Productivity is key for these new smaller venues. Agile automation, especially image recognition robotics for sorting, picking, packing, and inventory management, would enable local stores to support online sales. Many options are available for companies of all sizes, including mini-automation options for a store or supermarket as small as 930 square meters (10,000 square feet).
With product handling covered by automation, associate productivity will be measured by time spent with customers. KPIs and reports-analytics can be managed at headquarters supported by artificial intelligence (Ai).
Trust the data
There is huge change-management required as users must learn to “trust the data” from Ai, machine learning (ML) and smart solutions that are not always transparent. This will get easier as they see the results and understand what drives them; but even as digital-native Gen Z enters the workforce, IT solutions will still need an easy-to-use, intuitive user interface.
Future volume users will be planners, merchants and marketers, more than engineers or data scientists. No one wants to spend time with manuals or training. The trend needs to be download the app, log into the cloud and go, with emerging emphasis on gamification for associate training.
Corral the data
Many companies now offer “platforms” that they say will gather data from multiple sources and help distill, analyze and dashboard it. Dassault Systèmes’ Centric PLM provides proven enterprise solutions that combine all product-related data, so teams can find the information they need and collaborate from all over the world. And for the individual shopper – a grocery cart that scans and weighs the item as it’s placed in the cart. Shoppers will simply pay for the cart when they finish shopping. No more unloading at the cash register.
Smarter sustainability
From TerraCycle Loop (a new circular delivery service for consumers that replaces single-use disposable packaging with durable, reusable packaging) to accelerating resale/rental models in response to the pace of fast fashion brands which can introduce new collections every two weeks and dispose of more than half what they produce in under a year. With emphasis on circular product design, streamlined packaging, better inventory management and smarter logistics, the retail industry is well into exploring ways to minimize waste and pollution.
Packaging for consumer delivery is the #1 focus for many, followed by returns for damaged products. Dassault Systèmes’ Perfect Package solution on the 3DEXPERIENCE platform helps manage sustainability certifications, including Fair Trade, Energy Star, Green Star, Green Shield, Water Sense and labor standards.
Many presenters spoke on the challenges of balancing fast shipping with sustainable packaging that would still protect the product. Dassault Systèmes’ Perfect Logistics solution identifies fulfillment options for the retailer and consumer, balancing speed and cost, and introducing a sustainability metric into decision making.
And for the future…
Despite the reduction of big box stores, increase of online shopping, and changing market demographics and buying habits, retail persists. As we see from NRF2020, brands and retailers are embracing the challenges. They clearly seek the vision, with new technologies, innovation and experimentation to continuously reinvent retail to best serve consumers and grow their future.
Susan Olivier, Business Consultant for Dassault Systèmes Consumer Industries, contributed information and commentary for this post. She has been part of Dassault Systèmes for over 10 years, with a passion for consumer-driven retail experiences. linkedin.com/in/susanolivier
