Big Takeaways from the National Retail Federation’s 2022 Big Show
Retail leaders and tech companies gathered in New York last week for the 2022 National Retail Federation Big Show at which Target chairman and CEO Brian Cornell was honored with the Visionary 2022 award. Best Buy CEO Corie Barry also spoke about how the Richfield-based electronics retailer weathered the pandemic and what she described as “digital comfort. “People are easy with technology now in ways I’ve never seen before, but the flip side of that is very high experiential expectations.”
Two other Twin Cities-based industry insiders attended the retail conference: Aaron Keller is CEO of Minneapolis branding agency Capsule, which works with brands like Patagonia and Hydro Flask. He’s also a TCB columnist. Brian Lannan is head of retail experience at Avtex, a national customer experience (CX) consultancy based in Bloomington. He joined Avtex in 2021 from Target, where he led the guest experience team. Both shared their big takeaways from the Big Show.
Lannan: This theme came up again and again. Numerous speakers, including keynoter Corie Barry of Best Buy, talked about putting the customer at the center of everything they do. They reiterated the importance of building empathy for customers and working back from their journeys to design optimal experiences. Customers’ situations and expectations are fluid right now; retailers must serve them in the way they want to be served. The last thing a customer needs is more friction in their lives. Retailers who lean into the Customer Experience in everything they do will be the winners.
Keller: It was a good thread line through the speakers and an indication of the optimism in uncertainty by retail and brand leaders. It isn’t a new thread for sure, but one perhaps left at the bottom of a gym bag back in early 2020. It needed to come back and in a new form, treating customers like heroes as they have come through this profoundly frustrating period as well.
Data and Analytics
Lannan: Data and analytics are the new competitive currency in retail. Retailers are prioritizing the collection, analysis, and application of big data everywhere. Companies are moving beyond just product recommendations and customized marketing to even more sophisticated and precise uses of data, like supply chain management, proactive customer service, fraud management, labor scheduling, and raw materials forecasting – all while reducing costs and providing a better experience to customers. More important, data can deliver personalized CX, like the one we at Avtex helped created for Chipotle’s loyalty program. It recognized vegan customers, for example, and therefore avoids sending them discount offers on beef burritos.
Keller: Agreed, and a bit of caution—this is yet another view into the amount and varied forms of data being collected by brands and retailers. As we look to a future where we own and control all our own data, the caution is for leaders to respect the consumer as a human, not a set of data points. Treat our data as you would your children’s data. When data on us is used for good, we are surprised and give back with our loyalty. When it isn’t government gets involved and consumers get weary of brand leaders who can’t be trusted with our personal data.
Flexibility and Partnership
Lannan: We’ve entered a phase of the retail industry where flexibility and partnerships are critical to competing. Nearly every NRF speaker mentioned being curious, innovating constantly, and needing to look outside their own four walls for inspiration and new capabilities. The number of partnerships any company can enter is finite so there is a first-mover advantage (e.g., Target’s acquisition of Shipt a few years ago). No one knows the future, but if you’re not generating and testing new ideas – preferably with lots of consumer input – you’re going to fall behind competitors who do. Retailers must future-proof against continued rapid industry changes.
Keller: If there’s any good coming out of this pandemic, it is brand leaders seeing their teams ability to be adaptive, curious, resilient and relentless in pursuit of innovation. This has shown up in partnerships, new product development, new service offerings and new channels to market. Most important, it has shown up in organizational culture coming out the other side of this era.
Lannan: Employee centricity and strong investments in DEI are table stakes in a difficult labor market. Ensuring that your employee base is representative of your customer base will ensure your brand stays relevant. Ensuring diversity in your employee base also leads to better decision- making and more innovative ideas.
Keller: We have always been in a global economy and we’re certainly going to be seeing more understanding of our global labor economy. For more and more retailers, seeing beyond physical borders for diversity, inclusion and equality of opportunity will be essential for growth.
Lannan: The industry is in flux given inflation, the pandemic, and the tight labor market, but there is guarded optimism for the economy and the industry. Consumers’ top concerns right now are safety/wellness and inflation. CX will increasingly be a differentiator during good times and bad, so brands need to invest now to capitalize on a growing market later in the year.
Keller: Customer experience work is more relevant than ever and those of us mapping experiences shouldn’t be afraid to throw out last year’s journey map and start fresh again this year. The eternal fire of optimism burns hot in this author, but there is also a realist in me with a mask, gold coins and a cautious look on my face. We have a long uncertain future in retail where “normal” is becoming a swear word.