A fantastic three days at NRF 2015 have just come to a close. For me it was four days, as I had the opportunity to attend the Retail ROI Super Saturday conference for the first time– more on that in a minute. The extra day that NRF added gave me the chance to walk the floor a little, something that the two-day format made all but impossible in years past. As I reflect on the conference, here are a few thoughts:
- Profitability is the “P” that retail needs to concentrate on most. Not surprisingly, omni-channel commerce and omni-channel fulfillment dominated much of the marketing from the show floor. The urgency to get the customer whatever he or she wants, whenever he or she wants it, was palpable. The quest for sales and happy customers eclipsed what I think should be the real urgency – profit. I’ve written before about my view of in-store fulfillment; when it is treated as the rule, and not the exception, the supply chain becomes wholly inefficient and profits go out the window.
Satisfying the customer is what retail is for, however in recent years the connected, “right now” customer is making demands of retail that are putting stores out of business. Retail as an industry needs to step back from the rush to cater to the customers’ every whim and put processes and technology in place that will enable profitable decisions. I believe that customers can still get what they want, when they want it. But without more intelligence behind the fulfillment decisions, many retailers will continue to sell their way out of business.
- Returns are going to kill retail if omni-channel fulfillment doesn’t. In sectors like apparel, retailers have trained online customers to order multiple sizes of the same item, try them on at home, and then return those that don’t fit to the store or DC. The volume of returns is increasing exponentially. Retailers are paying to ship these items back and forth, and then process challenges slow the disposition of these returns, undermining the potential for a profitable sale. This is another area that needs reimagining. From science to predict returns, to increased velocity of returns processing, to gamification to drive returns to where the retailer wants them to go, when they want them, the returns process is ripe for disruptive change.
- This year’s buzzword bingo was dominated by “Internet of Things.” It was hyped to the point that buzzword leaders were advocating that it should be the “Internet of Everything.” Sensors, phones, video, anything and everything were thrown into the IoT discussion. However, the hype is well out in front of the discussions around customer privacy and data security. I hope that when privacy enters the discussion, it does not undermine the potential for IoT.
No one was on the IoT bandwagon faster than the RFID vendors. More data flowing into decision systems means better results, so I’m all for RFID and other sensor technologies. I hope that the RFID vendor’s businesses, and business cases for RFID, have evolved. The cost of tags and limitations in the technology stunted RFID’s growth during the last wave a decade ago, hopefully this time will be different.
- Lastly, if you aren’t familiar with the Retail ROI charity and their Super Saturday conference, you need to be. Super Saturday was a great mix of forward thinking retail discussions and inspiring stories of advocacy work for at-risk children around the world. Keynoted by one of the Time persons of the year, Katie Meyler, the conference educated attendees on the latest retail trends, as well as the charity work done by the Retail ROI foundation. Ms. Meyler’s speech about her experiences on the front lines of the fight against Ebola in Liberia was captivating. Her determination to make a difference had a tangible impact on Liberians in the West Point community where she operated a school before the outbreak. She is proof that one person can make a difference. I found Super Saturday to be an energizing start to NRF, as well as the most intimate way to network with peers and retailers that the NRF experience allows. Put it on your 2016 calendar now.
Let me know what you thought of NRF.