What’s retail’s future? Just ask NRF’s Matthew Shay.
This story is part of Big Thinkers, a series of profiles on business leaders transforming industries with bold ideas.
If the retail industry were a story, Matthew Shay could be considered a bard.
As President and CEO of the National Retail Federation (NRF), Shay’s job is to speak on behalf of the nation’s largest private-sector industry employer—and, crucially, to advocate for its success in Washington, D.C. and beyond.
In this interview with IBM, Shay reflects on his tenure at NRF and describes the powerful forces shaping retail today.
IBM: What have been the biggest changes you’ve seen in the retail industry since you joined NRF in 2010?
Shay: There’s been a rapid transformation, which has really been driven by two things. One obviously was the economic environment coming out of the recession of 2008. The other was this rapid move toward experiential retail and this world in which customer expectations have grown dramatically in terms of fulfillment and performance. The bar has really been elevated. There’s also been an amazing disruption that’s occurred because of the use of technology and more recently by the use of mobile devices. That’s really accentuated the need for retailers to find ways to deliver unique experiences and still give increased levels of engagement with their customers.
AI is changing every industry, and retail is no exception. What opportunities does AI present and what are the challenges?
We devote so much attention to these amazing technological advances. But the way they are deployed has to be balanced against the understanding that retailers are meant to be merchants delivering products to customers at a price point and with a level of convenience that creates value. If AI can be deployed to help accomplish that, that’s great. But obviously companies of different size and scale will have different levels of ability to employ some of these technologies. That’s why partnerships with companies like IBM are so important.
You speak with retail professionals every day. What are the biggest opportunities brands see in the current retail landscape and what are the biggest challenges?
As far as potential impediments, I think they’re mostly external factors that can’t be controlled, like the economy. But I think at the moment there’s a great deal of optimism about the near-term future. Consumers are really responding to the kinds of technologies and experiences that retailers have finally brought to market in sufficient scale to give customers real benefits. That’s everything from fulfillment and delivery to price and selection and inventory turn. I think you’re going to see retailers continue to deploy commerce and technology broadly to enhance those shopping experiences in stores and online.
Retail is responsible for supporting one in four US jobs. As an advocate and spokesperson for such a critical industry, what do you see as your responsibility?
I started as a 15-year-old kid stocking shoes at the shoe store on Main Street, literally in the town square in a small town in rural Ohio. To have that initial experience with retail and now this one where I work with retailers of all shapes and sizes—from Main Street retailers to global giants and everyone in between—is a great privilege. I think of what I do as helping to talk about what’s really happening in retail. I highlight stories of retailers innovating and serving communities for those who aren’t familiar with retail, or don’t have a contemporary view of the industry. I’ve been doing it for eight years and I feel we’ve only begun to scratch the surface.
We’re in a time of rapid technological growth. What’s the best action a retail leader can take to stay ahead of the curve?
Personally, I’d put way more emphasis on cultural transformation than I would on capability creation. My experience is that just because you’ve got access to the resources that give you certain capabilities doesn’t mean you’re going to transform your business the way it needs to go. I think what companies need to invest in today is the creation of a culture that embraces change truly and fundamentally.