Thoughts from NRF, Part 2: What's a Retailer to Do?

In Part 2 of my NRF 2019 recap, I focus on what the retail technology proliferation means for retailers and what I think they need to be doing. Part 1 of my NRF 2019 recap talked about the proliferation of retail technology, how retailers can make informed decisions and who the winners might be.

Some, and maybe even all, of the technology displayed at NRF 2019 will end up being adopted by a large majority of retailers: Artificial Intelligence, predictive solutions, virtual reality, mobile solutions, IoT, shop and go solutions (aka AmazonGo), personalization and even robots!

So, what to do? How to decide what technology to invest in? How to select which vendor to buy the technology from? 

If those are the questions a retailer is asking, they are asking the wrong questions. Before selecting a vendor, before selecting a new technology, there is a question that needs to be answered. What is the goal? Like any initiative, projects should start with the why. Why are you doing it? What is the customer experience you want to provide? It needs to be deeper than just saying provide an omni-channel experience or deliver personalized offers. A great way to define the customer experience vision or goal is to tell a story. Tell the story of the experience you want your customers to be a part of. Not from your perspective. Not from your view outwards. Nor in your language. The story should be from their customer's perspective, from their viewpoint outwards in and in language customers use. 

A shared retail mission and vision along with a clear customer experience goal will be key determiners of retail success in the future.

Until, and unless a retailer has a vision for the customer experience they want to achieve, any investment in technology is a waste of money and resources. But more important than the waste of money and resources is the waste of time - time that could be spent investing in and building the customer experience the retailer wants to achieve. Because in retail today, time is the most precious resource that retailers have. Consumer's expectations are growing, competitors are improving their retail experience and disruptors are changing and creating experiences and expectations. Hesitate, waste or misuse time and risk survival as a business.

Certain components and technologies will be used in every retail technology stack. How they will be used and the experiences they deliver will differ, often significantly. At the heart of retail solutions will be data, collected from store and on-line transactions, but also from both store and web browsing experiences, social media and other sources. Successful companies recognize there can be only one source of truth and will figure out how to consolidate all data in one source, normalize it and have all applications use the same data source. 

That means lots of integration needs to occur. It also means that AI, predictive analytics or something else will be required to make sense of that data. Immense volumes of data can overwhelm. Humans cannot find patterns in terabytes of data. AI can make sense of the data and deliver it as needed to help associates and other retail employees make better more informed decisions and deliver improved customer experiences.

For most retailers, a new architecture is required. Siloed architectures must go away, no more disparate store and web systems. Not knowing what the future holds, the best speculation is that shopping will happen on more devices and in more places, so the architecture needs to support delivering relevant content and processing anywhere anytime. In car. On appliance. In movie theater seat. Via voice commerce. Who knows? 

IT flexibility and speed of innovation will become a key determiners of retail success in the future.

One topic not discussed much at NRF, but an important subject is the importance of customer identification and authentication. This is needed to improve the shopping experience, deliver a more personalized experience, offers ad shopping assistance, and to secure new seamless and frictionless payment methods.  

I don’t know what the future of retailing will look like. We all know it is going to change and morph. I believe the retailers that thrive in the future will have a clear vision of what they believe retail will become and they will have a clear vision - a story - of the customer experience they want to provide. Everything else should flow from that.

Will the technology stack define or predict which retailers will survive and who will go out of business? Certainly, other factors like product mix, relevance, the customer experience and management do come into play. The question is whether a retailer's technology stack in and of itself can be the reason a retailer fails. I think so. 

What do you think? I would love to hear other opinions.

Additional resources:

• Read Part 1 of my #NRF2019 recap which talked about the proliferation of retail technology, how retailers can make informed decisions and who the winners might be.  
• For understanding why "why" is more important than "what'" watch Simon Sineck's TED talk: Simon Sinek: How great leaders inspire action
• For more on Customer Identification and Authentication see my blog post on this topic.
• For help developing your story see Story Miners or Customer Focused Marketing.
• For a company that has the experience to guide retailers on this journey contact BRP Consulting