The 2024 National Retail Federation ‘Retail Big Show’ Wrap Up

The National Retail Federation Retail ‘Big Show’ kicked off in Manhattan, New York last week.

Fleur Brown, Chief Industry Affairs Officer from the Australian Retailers Association and Queensland University of Technology, Professor Gary Mortimer were there to capture and share the latest retail insights for members.

While there were over 1,000 exhibitors and 170 presentations, Fleur and Gary have put together the Top 10 trends.

1 – Failing to upgrade technology

When used effectively, technology can improve employee productivity, improve customer service, reduce human error and cut costs. But technology can be a curse for retailers who continue to rely on outdated systems, often failing to serve the purpose they were intended.

Retail teams often claim that outdated technology is their biggest frustration with the industry. Organisation intranets, email systems, and legacy management systems are all examples of outdated technological practices that are still widely used despite the fact they operate in isolation and cannot be connected to external technologies and software.

Walmart CEO John Furner proffered, “You just can’t keep doing the same things, with the same tech.”

2 – Teaching an old dog new tricks

One of the key challenges facing older retail brands is maintaining relevance in a contemporary market. As decades pass and consumers evolve, retail leaders must constantly seek to understand these new customers. This was a key challenge for Michelle Gass who joined 170-year-old Levi Strauss & Co. in early 2023.

Michelle offered, “Despite our brand being 170 years old, in some markets, we are only just starting. In Asia, India, the Philippines and Thailand, we are seeing growth opportunities. We are constantly looking for growth and volume markets to enter, like China and Latin America and Mexico.”

Michelle offered that growth will also come from product innovation, development, and extension – leveraging the iconic brand name.

3 – Designing out waste to deliver lower cost

Managing Director of Kmart Group Australia, Ian Bailey explained how Kmart Australia had “doubled down” on their clarity of purpose and innovation, to develop a strategic blueprint and operational architecture to transform the discount department store.

Bailey acknowledged that retail businesses incur costs throughout the supply chain, such as poor buying, inferior design and quality and inefficient logistics.

“We wanted to create value and a space where shoppers didn’t have to compromise on quality”.

“We have developed a mindset within Kmart to ‘extract the waste’ throughout the value chain – from the design stage, all the way until the product is purchased by the shopper. Designing out the waste has saved costs and this enables us to reduce prices further. It also has a positive impact on the environment.”

4 – Creating retail for the AI generation

Most sessions touched on ‘AI’ in some shape or form, although the application of AI was delivered differently.

Anshu Bhardwaj, Senior Vice President and Chief Operating Officer, Walmart spoke about how AI-enabled Walmart to process massive volumes of data to detect unseen trends and patterns of behaviour.

“AI is embedded across our business, from how we personalise and improve customer experiences to how we get inventory through our supply chain and more. With the help of ‘visual search’, shoppers can upload photographs and use visual search tools driven by AI to identify similar products based on colours, shapes, and patterns.”

Anshu spoke about Walmart’s AI-driven Text-to-Shop. “Between balancing a busy schedule, work, household chores, preparing meals and ensuring they’ve got everything they need – customers have a lot going on. Walmart recognised that keeping track of a shopping list is often a mental task customers deal with as they go about their day.”

Al Lettera – Senior Vice President of Tractor Supply Company, spoke about their application of AI.

The Tractor Supply Company had implemented Generative AI for team members, named ‘GURA’ – an acronym for Greet, Understand, Recommend and Ask.

Through earpieces, or simply earbuds, team members can connect to GURA when faced with difficult customer questions. The Generative AI generates a range of clarifying questions team members should be asking, before offering solutions. The retailer found this smart retail technology had made team members’ jobs easier and improved customer outcomes.

5 – Online grocery shoppers aren’t the same

Yael Cosset, Chief Information Officer at US Grocer Kroger spoke about the food and grocery landscape for 2024.

Online grocery shopping is predicted to continue to grow on the back of significant growth experienced during the pandemic. However, online grocery shoppers aren’t the same. Different segments have been identified, including ‘bargain hunters’ and ‘research-oriented shoppers’.

Retailers need to understand different types of online grocery shoppers.

At Kroger, Yael spoke about removing the mindset that customers who choose to shop online for groceries, need to compromise on freshness, quality, price and range. He suggested retailers need to meet and exceed expectations online, making it a legitimate channel, even for fresh.

6 – A shifting luxury alcohol market

Moët Hennessy CEO, Philippe Schaus, shared how the luxury alcohol market is changing. Like many Western economies, these markets had been ‘tight’ in 2023, as consumers watched their spending. However, this same cautious spending wasn’t true for all markets.

“We watch where consumers are spending globally and move premium products and resources into those growth sectors. So, there are times when will focus on one market than another. Asia Pacific and the Middle East are doing well.”

Schaus did admit that we need to ‘re-boot’ luxury champagne and liquor.

“When consumers are buying these products, you need to convey quality, and those perceptions of quality are communicated through store design, layout, atmospherics and service. You can’t sell a high-end whiskey through a high-volume, low-priced bottle shop. “

Schaus suggested luxury wine and spirit brands are now looking at how luxury jewellery and fashion retailers are engaging with their consumers and replicating these strategies.

“We are educating the consumer through luxury experiences. The Moët Hennessy retail strategy is to inform, rather than sell. Luxury liquor is driven a ‘point of sale’, in-store, through team member engagement, atmospherics, layout and lighting.”

7 – Retail leadership in 2024

NBA ‘Hall of Famer’ ‘Magic’ Johnson and Ed Stack, from DICKS Sporting Goods spoke about leadership.

Johnson spoke passionately about leadership, sharing, “Somebody once helped us all to get where we are today. So, we all need to ‘reach back’ and now help others.”

“What is important for retail leaders today is to make the tough decisions. Sometimes to change the corporate culture, you need to change the team.”

Johnson reminded us that we all have competitors, in business, in life, and on other sports teams, but they make us better. You have to hate the competitor and that hate fuels motivation, innovation and growth.

Similarly, Ed Stack spoke about value alignment, suggesting that retailers have a ‘voice’ and can influence policymakers.

“Live the values. DICKS removed assault guns and high-capacity magazines after the Sandy Hook and Parkland mass shootings. We copped flack, there was blowback, we lost customers, and team members and we lost sales, but we truly believed in taking a stance.”

8 – Three key retail disruptors

Futurist and trends expert, Kate Ancketill, encouraged optimism for a ‘tech-enabled’ future, discussing what impact this will have on physical retail, e-commerce and sustainability, as well as consumer shopping behaviours.

Firstly, ‘Consumer Guardianship’ – moving toward ownership of products. Ancketill suggests the climate emergency and the cost of living crisis are forcing consumers to recycle and repair. Everything from shoes, clothing, consumer electronics and furniture.

In November 2023, the EU adopted its position on a stronger “right to repair” for consumers. The proposal aims to encourage more sustainable consumption, by making it easier to repair defective goods, reducing waste and supporting the repair sector.

Secondly, ‘Empathetic AI’ – the idea that we are moving into a world where unscripted, synthetic and natural AI voice will become the norm. Driven by the mass adoption of voice assistants, modern life is complex and busy, so ‘voice’ is becoming the future.

Thirdly, ‘Reality Checks – as our lives become more dominated by technology and AI, there will be a counter-movement. Ancketill indicated 78% of the US population believes “they no longer agree what is real and unreal, truth and lies. The world is already seeing the emergence of deep fakes. Consumers are concerned about the loss of privacy.

Ancketill suggested there is still demand for physical retail, despite the growth in online, e-commerce, socials and digital.

9 – Smart Trolleys

While several vendors were offering Start Trolleys of varying standards, the standout was TROLLEE. With 5G and edge computing, TROLLEE uses machine learning and AI to analyse customers’ traffic patterns and reactions toward offers and customer journey optimisation. Vital data for retailers.

Offering two products, TROLLEE P1, that can transform any regular trolley into a smart trolley with just a simple clip-on option. TROLLEE P2, the more advanced, employs ‘computer vision’ to detect products as they are placed into the trolley, automatically changing customers’ credit cards, and offering a seamless shopping journey for shoppers.

TROLLEE P2 also offers an all-in-one solution with content management and real-time AI-driven campaigns, which helps retailers provide personalized service and in-store targeted offers, as customers move through the aisles. Importantly, TROLLEE P2’s advanced anti-theft technology uses computer vision and machine learning algorithms to recognise suspicious behaviours, reducing losses for retailers.

10 – Automated Inventory Scanning

Retailers are automating mundane tasks, like stock counting and reordering. Many would have seen ‘TORY’, Kmart’s inventory robot, that wanders the stores in the evening identifying the location of items.

The latest version of Automated Inventory Scanning is from tech company Shelfietech, who had designed a system that is attached to a standard gondola and moves up and down scanning and counting merchandise. The frequency of the scan and count can be tailored – less movement in a Health & Beauty aisle, where inventory turns slowly, while more frequently scanning soft drinks or bottled water.

Using computer vision, the system can detect items that have been placed in the wrong location, avoiding inaccurate stock counts and mis-orders. The system maps to sales, alerting retailers to missing products with no recorded sales. The combination of AI and computer vision provides accurate, real-time data on the status of each product, allowing managers to make informed decisions about stock, placement and replenishment.