Like It or Not, Retailers Are Becoming Technology Companies
WASHINGTON, D.C. — A general feeling among the guest speakers, retailers and technology companies participating in this year’s virtual NRF Show is that technology was the key to surviving the miserable pandemic of 2020. And, with several new strains of the novel coronavirus continuing to spread in 2021, retailers more than ever are looking to advanced technology to engage and serve their customers in the safest ways possible.
“Saying this has been the craziest and most tumultuous time in retail history is an understatement,” Panos Anthos, founder and managing director of XRC Labs, a design-central retail innovation accelerator, said during NRF 2021: Retail's Big Show — Chapter One, which took place in January.
The continuing fear of the pandemic has already caused the National Retail Federation (NRF) to announce that the second chapter of its show will also be a virtual event, shifting from an earlier plan to hold an in-person event in June. The Javits Center in New York, the planned site of the Chapter 2 event, is currently being used for vaccine distribution.
Retailers have been forced to reimagine the use of their physical stores, utilizing technologies that enable them to inform and provide new levels of convenience to customers, according to one panel discussion during the Chapter 1 event. By unlocking the power of in-store tech solutions, companies can drive customer loyalty and engagement, and heighten brand experience.
Panelist Travis Boyce, head of global retail operations for Allbirds, a shoe retailer that sells both online and through brick-and-mortar stores, said his company has been focused on in-store safety for both workers and customers. “We are committed to brick-and-mortar for the long haul,” he said, although they are taking a cautious approach to expansion.
“When do we see a retail comeback? It’s predicated on omnichannel integration,” added Anthos.
In the convenience store industry, there are technology leaders and laggards, according to Ryan Yost, vice president and general manager of the printer solutions division for Avery Dennison Corp.
“The leading companies realize that technology is not just the responsibility of the CIO — everyone has a role, from the CEO down to marketing and store operations,” said Yost.
Discussing the top tech trends affecting the convenience channel, he said the foremost trends revolve around improving the customer experience.
“Frictionless, omnichannel or leveraging your footprint, creating brand awareness with a social media-connected consumer, and front and back-of-the-house automation are all part of improving the customer experience with technology,” said Yost, who believes best-in-class industry leaders will set the pace for technological advancement across the entire channel.
He also pointed out that Amazon is a tech company that has become a convenience retailer.
“Convenience stores must recognize that they are competing against tech companies now, and need to think of themselves as tech companies,” he advised.
Yost pointed to technology that enables transparency and traceability of the supply chain as another tech trend that is becoming paramount to the best-in-class convenience retailers. “They want to ensure fresh and healthy assortments for their consumers,” he concluded.
Jeff Bradbury, senior marketing director at Hughes Network Systems, echoed other retail tech experts when he noted: “I’m not sure we are going to see a distinct change in customer behavior” after the pandemic. Customer behaviors have changed and are beginning to solidify into a new baseline that will have retailers continuing to pursue contactless and frictionless payments, buy online/pickup in store, and other pandemic-inspired innovations, according to Bradbury.
When it comes to tactical technology priorities, EMV transition to meet the April deadline for compliance at the forecourt is still front and center, he said, reporting that about 25 percent of c-store retailers are still non-compliant with the credit card companies’ liability shift.
“A lot of pumps have been upgraded to be EMV compliant, and some have added mobile wallet readers,” he said. However, Bradbury also acknowledged that some retailers “won’t cross the finish line” for EMV compliance until the end of the year.
He noted that the push for EMV compliance has brought many retailers to the realization that a MNSP (managed network service provider) can really facilitate the required transition. “It’s not just large retailers, but three-, five-, 10-, 20-store chains are seeing the benefits of using a professional resource to handle all PCI (payment card industry) responsibility, along with POS, inventory management, security, etc.,” he said.
Another important area of technological focus for c-stores, according to Bradbury, is the use of digital signage. Integration of digital signage both inside and outside the store will enhance new programs like curbside pickup. “And digital signage throughout the store, even on glass cooler doors, will be so engaging and eye-catching to customers,” he said.
“Artificial intelligence (AI) is the next big thing that’s coming for retailers,” added Bradbury. AI will improve the offering to customers, be used in loyalty programs, enable frictionless checkout, and more. “There are so many ways to apply AI in convenience stores,” he said.
NRF 2021: Retail's Big Show — Chapter One took place virtually Jan. 12-14 and Jan. 21-22. NRF 2021: Retail's Big Show — Chapter Two is slated to take place June 6-9.