Looking back at NRF’s 2019 Big Show: Standouts, Ah-ha’s, and…Misses
Now that we are all back from the hustle and bustle of trying to see or attend as many exhibitors, sessions, and events as possible at this year’s Big Show, we are reflecting on the event and comparing our experiences. Here are some observations and insights we compiled from Parker Avery’s 2019 NRF team.
1. What stood out this year vs. previous years?
Marty: More focus on the customer experience and providing a consistent omnichannel experience. One example was stronger CRM integration (once a customized integration) now being included in core configuration through to POS to drive discounts, clientele tracking, sales recommendations etc. I saw more emphasis on simplified integration—many vendors I previewed spoke to new API components to simplify integration with up/down stream systems which previously had been more difficult. There was also a continued march to the cloud across all vendors and platforms and an understanding that this requires more “configurable” components as customization must be a thing of the past.
Clay: Cloud options allowing even large software companies to play in mid-market space more easily and economically. At same time, traditional mid-market software companies for the most part have further developed their portfolios, also in cloud, so there are strong options.
Robert: At the high levels presented at the Big Show, it’s really hard—particularly for retailers seeing the NRF ‘sales pitch’—to determine how the vendors and their solutions are truly differentiated from each other. It’s important for interested retailers to ask the right questions and speak with other retailers about their experiences with specific vendors and solutions.
Courtney: Exhibitors better displayed their customer experience story—from fully functioning stores with fresh produce and on-trend clothing to automated, self-check and custom packaging. This gave retailers a chance to step into the shoes of their consumers, however there is still a lot of opportunity and work to be done to decode consumer data and effectively anticipate the choices of the consumer.
2. What were some of the consistent trends or messages you observed?
Robert: There is general agreement that enterprise PLM is no longer on the minds of larger retailers these days—they likely already have a PLM solution. Small players ($300M or less) are selecting solutions, but Centric is dominant in this sector. As a result, folks like NGC and CBX are looking to augment PLM solutions rather than rip/replace. They are now offering solutions focusing on vendor management (scorecard, social compliance, testing, etc.) and pre-PLM assortment collaboration between retailers and suppliers (i.e., Retailer asks supply base, do you have a $10 widget with high-level attributes (not a spec)).
Clay: Overall process maturity and desire for innovation is pushing retailers towards improved analytics especially in merchandising space.
Amanda: Continued focus and buzzwords around machine learning and AI, as well as more consistent integration with CRM tools and customer facing solutions (POS). From the solution providers I spoke with, they indicated more C-level involvement in the show outside of the CIO. Now that cloud has taken a role and the financing rules are slightly different, it seems it’s a whole C suite initiative to move forward. It’s not just for tech anymore. There remain a lot of questions on how to get to the new shiny objects in the room (ML and AI). How can retailers use these newer technologies and keep up or in many cases catch up effectively? Software providers are trying to manage expectations of data and how to use in their solutions – attributing, hierarchy management, etc.
Marty: Agreed—there was definite focus on weaving AI/machine learning and now ‘neural networking’ into every platform. I saw continued focus on moving customers to cloud and away from costly, aging on-premise solutions. I also noted continued focus on providing mobile applications where relevant especially at point of sale—an interesting dynamic for certain as retail continues its channel-agnostic evolution.
3. Did you hear or see anything surprising or impressive? Any “ah-ha” moments?
Robert: I heard Verizon talk about visual/video analytics leveraging their new 5G bandwidth networks, but to me the execution was not clear – does this mean mining videos of customers to glean meaningful information? IBM and Microsoft were touting visual AI; I witnessed a demo where the Microsoft rep scanned a picture of a blue ankle boot, and their solution “looked” for fuzzy matches of similar styled/colored shoes in the demo assortment. I feel like AI/AR/VR has matured (there were actually ‘rhinobots’ serving food), and it’s cool stuff for sure, but I failed to see any real-life use cases for our clients besides forecasting—which is relevant and more mature than most AI I have seen.
Courtney: Not surprisingly, my “a-ha” moments came from the Innovation Lab and stage. The most encouraging message that I heard was the creation of more long-term business transformation teams. While business transformation is certainly not a new concept, more retailers were finally talking about how to better integrate these teams within different areas of the business and not have them working siloed. There was also marked discussion around giving these teams more room to “fail”—or better yet, learn and improve and facilitate the entire organization in adopting a culture of continuous improvement. So many organizations are running lean, but I think to be able to continue that mindset, there must be more investment in innovation.
4. What was missing? What needs to be addressed or adjusted?
Robert: From an overall capabilities perspective, the “Holy Grail” of capturing customer analytics and mining them for a purposeful result is still not mature. From a vendor/solution perspective, there seems to be a void of mid-size software vendors. We’ve seen a fair amount of consolidation (e.g., Infor, Aptos, MI9) and numerous very small niche players. Because of this dynamic, retailers are asked to make tough choices – go with very large, complex, and usually expensive solutions which are typically more functionally complete, or deal with small vendors who are not as mature nor as robust in their solutions. With respect to the ‘shiny objects,’ I think the software vendors could take a lesson from Microsoft and perhaps other big vendors and focus on meaningful use cases in their booths. I realize the SalesForce, Oracle, SAP, IBM, and Microsoft types have a lot more money and resources to prepare for the Big Show, but their approach, for the most part, attracts me because they talk about a use case. Is it all there today? Probably not—but there seems to be a pragmatic result on which they’re trying to get retailers to focus.
Clay: So just to prove that Robert and I don’t always agree, while it’s true that some of the mid-size solutions in the merchandising space have grown through merger/acquisition, I also think many of them have come further in the last year or two than the very large vendors in adding new feature/functions, and telling compelling stories to those retailers that are unlikely to be candidates for the largest software vendors.
Amanda: How to evolve solutions to keep up with new cloud technologies most efficiently. Everyone wants you to move to the cloud, but no one is telling you how to get there.
Courtney: Biased opinion from me, but the “how” when it comes to the people component of using new technologies. I saw a lot of personal assistant and AI integrations, which is becoming fairly intuitive, however other technologies have a much steeper learning curve. Even the most impressive demonstrations had me questioning how both retailers and consumers would interact with these new tools if the capabilities and functionality are not effectively communicated and understood. This became even more glaring when thinking about the customer experience and how much thought is needed to make sure the right resources are in place to support these initiatives. At the same time, there is a huge shift to make the customer experience more streamlined and having less face-to-face interactions—even with stores. What happens when these technologies fail or there are retailer/brand specific nuances? The brands who are already preparing for this are focusing more on their associates and hiring people from a diverse set of backgrounds and experiences. For example, Nabisco reviews every solicited and unsolicited resume because “everyone eats cookies.”
Marty: I feel like there is a missing ‘how-to’ link for the realization of the ‘omnichannel experience.’ I heard a vendor say that channel planning wasn’t as important with omnichannel capabilities, but there doesn’t seem to be a clear path to addressing this between the upstream planning and downstream order management and POS. Everyone is talking about it being important but very few solution vendors did a great job in showing that storyline from beginning to end in an easy to adopt experience. There is still a lot of maneuvering required to make the end-to-end omnichannel experience work smoothly.
5. What are retailers talking about or worried about? Do these align with the rest of the industry?
Clay: Several retailers we spoke with are definitely already in process or planning to move to cloud in the next 12-18 months. Big challenge they acknowledged was a need for focus on configuration versus customization, and awareness of likely business process and change management implications. The software can only be configured so much, so how do they ensure their organizations are prepared for impacted processes and roles.
Sonia: Merchandise planning continues to be a focus of many, with attribute planning and machine learning being further developed in all systems. The past couple years we have seen the acquisition of TXT and JustEnough into merchandising system companies Aptos and Mi9, continuing on the message of integration to all key merchandising functions is a big part of planning systems. We have also seen several smaller companies like S5 Stratos and AGR Dynamics moving sites to North America, joining the playing field with a focus on clients under $1B.
Amanda: From the retailers I met with it’s how do they continue to evolve and keep up with something moving so fast. It’s all about the customer experience, but for some, adapting to new and quickly-changing technology, the reach is quite far. The big conundrum we discussed is how can they get their feet wet without crushing their cash flow and hindering their business—all while ensuring their own organization and customers smoothly transition into new environments?
Marty: Again, many retailers are struggling with how to deliver an omnichannel experience to their customer while maintaining a complex multi-channel business strategy from the planning stages through multi-tiered pricing strategies that can be managed through their supply chain, presented in store, and understood by in-store and customer-facing systems.
Courtney: The “what comes next?” advances within the industry are coming fast. Looking back on just five years ago, we are at a place that would not be imaginable then. Voice commerce will definitely become stronger with the omnichannel experience. What we think that looks like now, does not even begin to scratch the surface of possibilities. Most retailers agreed that new online and data privacy laws are for the better, though still question how customers interpret them and exactly what data and sources are used. There was a lot of discussion on the desire to have more data vs. clean data—which will continue to be both a balance and struggle. Retailers are thinking about how to use customer analytics to deliver upon the customer’s desire to explore vs. what they expect. A lot of our browsing and purchasing habits are collected by retailers and they can use this to offer targeted incentives and services to consumers, but there is a fine line of when this turns from convenience to creepy.