What’s In Store for Retailers in 2018? Four Key Themes from NRF

2017 was a rollercoaster year for retailers.

Store closures more than tripled in 2017 compared to the previous year and our news feeds were cluttered with falling stock prices and striking headlines. On a positive note, retailers had a strong finish to 2017 with a better-than-expected holiday season: Combined revenue growth across Thanksgiving Day and Black Friday increased 23% year-over-year.

Mobile played a big role in this as mobile revenue was up 43% during Thanksgiving week. Favorable market conditions positively influenced by strong employment and tax cuts contributed to retail’s finish to 2017.

Eager to carry this momentum into 2018, members of the National Retail Federation (NRF) flooded the Jacob K. Javits Convention Center in New York this past weekend, energized and excited to “talk shop” with industry peers.

Key Themes from NRF 2018

It’s not a retail apocalypse, it’s a retail evolution

Contrary to what you may have read in the media, the retail industry is not doomed. The ways in which consumers buy has changed dramatically in recent years, but they are still buying. This shift in consumer behavior has put pressure on retailers to “evolve or die” in terms of how they sell to customers.

Throughout the four day conference, retail leaders reinforced a strong message that innovation is the key to success in this extremely competitive industry. James JC Curleigh, President of Levi’s Brand, called on the retail industry to keep moving forward by innovating to stay relevant.

“We have to turn moments into momentum,” he said. “None of us can guarantee we will succeed in the future, but we can set the conditions for success.”

Winning brands are innovating behind the scenes

Chieh Huang, CEO and co-founder of Boxed Wholesale, proudly declared that online grocery is no longer a sideshow, but a key part of any grocer's experience. He also said that, although consumers purchasing behaviour is changing, stores will be a big part of the future, creating "a more millennial-focused experience”.

Large retailers such as Primark and Barnes & Noble have adopted this strategy by incorporating services like coffee shops and nail and hair salons into stores. These additions increase foot traffic and make the physical space more appealing, allowing busy consumers to complete multiple tasks during one trip.

Instagram is the new storefront

Salesforce announced several new features for its Commerce Cloud e-commerce platform at NRF. One of the most exciting announcements was around Instagram.

Salesforce revealed a new feature that allows retailers to create shoppable posts directly in Commerce Cloud. Retailers can also automatically tag posts in any Instagram feed where a logo or specific products appear.

Previously, retailers had to manually update Instagram to enter new catalog items, tag content, or create shoppable posts in that social network. With over 800 million active monthly users, Instagram is a gold mine of untapped potential.

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Personalized cross-channel experiences will dominate 2018

Internet and mobile users demand a highly personalized experience in exchange for their data. But marketing has become disconnected in recent years as many large retailers have siloed email, web, mobile, inventory, and physical-store teams.

Instead of working together to deliver consistent brand experiences at every touchpoint based on shared user insights, teams send users inconsistent messages or interrupt user flow by repeatedly asking for the same information (email address, username, etc.).

To avoid this, brands must connect better internally. Multiple teams must work with the same vision and bring the entire user journey together based on user behavior patterns. Retailers that provide users with a consistent cross-channel experience will be successful in 2018 and beyond.

One great example of this from NRF came from Mike Luzzi, director of global IT innovation at PepsiCo. Luzzi revealed that the company is using digital signage technology that can recognize when a consumer is beside an in-store product display. The brand can then leverage Bluetooth Low Energy beacons to send mobile coupons to customers in order to entice them to buy a certain product.

This unique approach to leveraging a mobile channel for promotions is used in tandem with more traditional marketing channels

The future of retail is ripe with innovation

Constant innovation behind the scenes has allowed traditional retail brands like Levi’s to stay relevant, 150 years later. Experimenting with experiential retail concepts such as interactive changing rooms, wearable technology and line-free mobile checkout will help deliver great user experiences in the coming years.

The brands that will win in 2018 and beyond are those who can combine technological innovation with a consistent cross-channel experience driven by interconnected data and highly personalized, relevant user experiences.

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