February 4, 2016 | Written by: Trevor Davis
Well NRF 2016 is over, and I managed to escape from New York just before the snow arrived (link). For those of you that don’t know what NRF is, it is the annual National Retail Federation conference held in New York and it attracts over 20,000 people each year (NRF).
Depending on your temperament it’s either an exciting opportunity to see the latest and greatest in retail technology, or it is a human zoo that you have to fight your way through if you want to visit the restroom or have a sandwich!
Now, you may be wondering why an expert on consumer products would go to a retail event. This is a question I ask myself every year, and this is what I answer: retail and consumer products are part of the same value chain. What happens in retail is directly relevant to what happens at the manufacturer end of the chain. For example the rise of omni channel in retail has created enormous opportunities and challenges for fast-moving consumer goods companies in terms of supply chain segmentation. It’s also created a whole new world of consumer engagement, and made it possible for some manufacturers to operate direct to consumer channels as well (“retailing”).
You also get to meet some interesting, er, people. Here’s a picture of me with some colorful friends from Elemental Path – smart, kid-friendly dinosaurs powered by IBM Watson technology (more on this later).
The Big Trends at the Big Event
This year I was interested in understanding the big trends from what was on display at NRF. I saw three:
- First of all, I saw a lot of technology designed to augment store associates – help them be more than human.
- Secondly, I saw a variety of demonstrations that were aimed at extending the brand experience and not just in a traditional retail setting.
- Thirdly, I detected a trend around reinventing the concept of the customer journey and the role of the channel. Let me take each of these in turn.
More than human
Information technology has for a long time helped human beings to extend or augment their capabilities. This is very obvious in areas such as Finance, but at NRF 2016 I saw many examples of how information technology is changing the role of the store associate and, in turn, I see this as a broader move to a change in the role of the store itself.
It seems to me that stores are moving more and more in the direction of showrooms, and this means that store associates need to have much greater product and customer awareness. You can think of this as taking on more advisory roles, and in that role it is important to be able to interact effectively – fast access to knowledge, eye contact etc.
So for example, Theatro (http://theatro.com/) demonstrated some very interesting Internet of Things wearable devices – replacing two-way radio with tiny voice controlled computers that can help with person-to-person and person-to-machine communication in store. No distracting hand-held devices!
Going further, companies such as Aldebaran were present with social robots on the IBM stand (https://www.aldebaran.com/en). These robots are able to engage in dialogue with human-like mannerisms that help with engagement and service provision. You might also like this tweet that brings the robots to life with a fun macarena video! https://twitter.com/brandmaster63/status/689560390661836800.
Awareness of what is going on in-store can also be improved without being too intrusive. We are certain to see more and more technology being used to improve shopper tracking and store operations, adding to the systems already available to store managers and associates.
For example, ClickIT (http://www.clickitinc.com/) demonstrated sophisticated automated shopper identification technologies for use by staff in stores. Some people found this slightly intimidating (have you seen Person of Interest – read more?) and others saw huge benefits in terms of improving the shopping experience and detecting shrinkage and other risks.
Aruba (http://www.arubanetworks.com), recently acquired by Hewlett-Packard, demonstrated a new generation of hardware and software for in-store detection using beacon technology. Not exactly new, but showing how this technology is becoming more usable each year for shopper engagement.
VineSleuth (http://vinesleuth.com/), one of the IBM Watson ecosystem partners, is a great example of how cognitive computing can help store associates provide personalized sales advice in the area of wine selection and food matching.
Finally Intel demonstrated a number of intriguing technologies for use in stores such as intelligent mirrors (read more) to augment the experience of trying on clothes (two outfits side by side at the same time, anyone?) and a foot measuring device that could be used to personalize shoe shopping.
A better brand experience
Ever since the concept of the consumer and customer journey was proposed, companies have been looking to maximize the benefits to brands from multiple touch points. Now a variety of technologies are maturing that help along the way – virtual reality and product-service systems based on wearables and analytics to name but two.
For me, extending the brand experience to me was most obvious when I sat down in the IBM and Kraft lounge and tried the Oscar Meyer wiener-mobile (try it!) virtual reality experience. This uses Google cardboard and some wonderful footage shot in a bizarre looking sausage car (petrol heads will like this article) to give a sense of excitement to the brand. It’s certainly not difficult to imagine how this could be exploited in a wide variety of retail situations or shopping on the move. At the Salesforce booth they were using VR to connect visitors to the TOMS shoe drop experience, bringing the brand’s social mission to life alongside the shopping experience.
Under Armour, again working with IBM Watson technology (Adage article), showed how their personal health consultant software (combined with a number of sensing devices) turns the brand experience into something much more than what might be expected from an apparel brand. Primarily aimed at health advice, the possibilities for shaping purchase choices are obvious (“I see the weather is turning colder, shouldn’t you buy some thermal shorts to optimize your performance?”).
For many brands, converting the extended brand experience into sales means getting to the next level of personalization – fully understanding context (“where do I live”, “who are my friends”, “what kind of person am I”?), and cutting through the noise in social media. A start-up called Earshot (more here) is in the business of social conversion – using cognitive computing techniques to improve the signal to noise ratio in social media analytics. very useful for ‘precision everything.’
And at a more prosaic level, Hershey were there talking about how their ‘store within a store’ concept allowed them to be innovative around the brand experience at point of sale and raised sales by double digits – not bad, eh!
My final trend is around the reinvention of the consumer and customer journey. Capgemini in a pre-NRF series of interviews talked about “a disruptive shift in our value chains, where products and information no longer flow linearly and sequentially from supplier to manufacturer to retailer to consumer.” The implication for the sales and marketing is huge – thousands of moments of truth, a blurring of the lines between sales and marketing, and a need for a new class of tools to help with all of this.
For me, one of the more exciting items was IBM’s new journey designer (http://www.ibm.com/commerce/us-en/journey-designer/). This is new software to help companies visualize the entire journey and then to quickly make it a reality in their sales and marketing platforms.
There were many new visualization techniques on how, and old techniques being used in new ways. As an example of the latter, Esri (http://pike.esri.com/wa/retail/merchandising/) were present demonstrating graphical information systems being used in a new ways – for example, “multi-cultural merchandising” based on a better understanding of the populations of American cities.
Of course, it isn’t all about pretty pictures – the journey includes many moments of truth and touchpoints. Signifi (http://www.signifi.com/) showed some very exciting developments in automated retail (this is vending to you and me) – machines with a great deal of intelligence and the ability to present even the most luxurious items in the right setting.
Is that all?
Of course, walking round NRF looking for trends to report to you all isn’t the sole rationale for my presence there. I was also there to launch our new ‘Ready for prime time?’ thought leadership (http://www-935.ibm.com/services/us/gbs/thoughtleadership/primetimecp/) aimed at FMCG companies rather than retailers.
This study shares new research on innovation in building consumer product brand experience. This work takes our 2015 work on brand enthusiasm (http://www-935.ibm.com/services/us/gbs/thoughtleadership/brandenthusiasm/) forward in a number of areas such as consumer lifestyle changes, the impact of disruptive technologies and the growth of eco-ecosystems. In particular we spent a lot of time talking to people in other industries about what they are doing, and the findings are revealing (Hollywood and automotive perspectives are particularly insightful about what the next 10 years or so may bring).
We have rather a nice video up on YouTube that shows our view of where we might be in a few years if some of the trends in our study become a reality. Go take a look (https://www.youtube.com/watch?v=YunscQvRP5M).
As many of you will know I spend much of my life in the world of food and beverages, and so you may not be surprised to hear one of the highlights was the IBM client reception where Watson made an appearance behind the bar mixing cocktails for people to consume (read more).
If you take a look at this picture…
…you will see not only were we able to make cocktails using cognitive computing, but we were also able to capture the analysis of people’s preferences and choices as the evening progressed. After all, all play and no work makes for a dull day (well, that’s my take on it, anyway).
Written to the strains of Rhiannon Giddens and Burcu Gunes