This week, the National Retail Federation (NRF) brought together 40,000 attendees from more than 100 countries and 6,200 brands in New York City. Professionals from across the industry discussed the latest in technology, strategy, marketing and more.
Digital Commerce 360 was at the Javits Center for all three days of NRF’s Big Show to find the most important ecommerce stories. These were the most important takeaways from the event.
Top NRF Big Show takeaways
1. Unified commerce
Retailers across the show indicated that they’re not considering in-store and online sales as separate, siloed channels anymore. Increasingly, the same customer is shopping both ways.
“Everybody needs to think like an omnichannel retailer” if they want to be successful, said Michelle Gass, incoming Levi’s CEO. Retailers discussed creating consistent experiences across whatever channels a consumer uses to shop. For example, at Lowe’s, self-checkout uses the same technology as lowes.com, says Seemantini Godbole, chief digital and information officer.
Lowe’s ranks No. 12 in the 2023 Digital Commerce 360 Top 1000. The Top 1000 is a ranking of North America’s leading retailers by online sales. Levi’s is No. 192.
2. Every retailer needs an AI strategy
Artificial intelligence (AI) was the No. 1 topic of discussion at NRF’s Big Show. Every session had at least a brief mention of the technology that’s promising to revolutionize retail, with special attention on the possibilities of generative AI. Salesforce released a lineup of new generative AI tools for retailers and consumers who shop with them. The technology will work using Salesforce’s recently announced Einstein 1 platform. And the excitement around AI goes beyond just talk about future applications. Executives from e.l.f. Beauty (No. 950 in the Top 1000), Tractor Supply (No. 99), Saks (No. 28) and other retailers explained how they’re already using AI at the conference.
3. Data rules everything
AI was the buzzword, but all the most interesting applications are only as good as the quality of data fed into them. That’s the premise behind FedEx’s announcement of fdx, its new commerce platform for online retailers. The shipping carrier said it can help retailers track and manage demand, conversion, returns, and fulfillment based on insights from the 15 million packages it delivers each day.
High-quality data is key for other buzzy AI applications, like personalization and demand forecasting, Marc Benioff, Salesforce CEO, told attendees in a keynote during the first day of the show.
4. Physical presence for online retailers
Online retailers see the appeal of stores and physical locations. Chewy (No. 13) has plans to open its first physical locations this year in Florida, CEO Sumit Singh said. The planned openings are clinics, rather than stores, to grow within the $40 billion pet-health industry. However, they’ll also provide an opportunity to upsell other pet products when owners bring their animals in, he said.
Gen Z in particular shows a preference for stores, vice president of strategy at Aptos Retail Nikki Baird said. Reformation (No. 354) CEO Hali Borenstein noted younger consumers are more likely to visit the chain’s stores, too.
5. Sustainability is something to consider
Sustainability remains a consideration for retailers, especially when they’re trying to appeal to younger consumers. Two retailers addressed its specific importance in session during the Big Show. Under Armour (No. 97) CEO Stephanie Linnartz discussed the brand’s efforts to appeal to women in Gen Z and Gen Alpha.
“They care about sustainability,” she said. That’s why Under Armour is working on replacing spandex with a more eco-friendly recyclable material.
Reformation’s Borenstein said the retailer passed up opportunities for athleisure growth during the pandemic because it couldn’t produce products sustainably and quickly enough. The decision paid off, she said. It made Reformation’s claims to sustainability come off as more authentic, she said.
6. DTC strategy is shifting
Direct-to-consumer retailers are finding their footing after the market became more crowded during the pandemic. The market is much more volatile and demand is harder to forecast now, Bombas CEO Dave Heath said in a session for DTC leaders. Bombas and Ritual are both finding the sweet spot of retail stores’ sales versus DTC sales, the executives said. For Bombas, that’s around 15% wholesale. Ritual, meanwhile, is seeing success in Whole Foods, meeting consumers who are willing to pay a premium for high-quality ingredients, CEO Katerina Schneider said. It also started selling on Amazon in 2022, which functions as a “giant search engine” where new customers find them, she said.
7. Retailers can’t ignore Shein and Temu
U.S. retailers would be wise to pay attention to the rapid growth of two low-cost competitors from China: Shein and Temu, says Jason Goldberg, chief commerce strategy officer at the Publicis Group. Coresight Research CEO Deborah Weinswig noted Shein’s advantages in supply chain and its on-demand production model in outpacing U.S. retailers. The model allows it to nearly perfectly match supply to demand, creating less waste and improving margins over competitors, she said.
Shein is No. 2 in Digital Commerce 360’s ranking of ecommerce retailers in Asia. Temu, which Pinduoduo owns, launched in 2022 and isn’t yet reflected in rankings. Pinduoduo operates an app-only marketplace for Chinese consumers. Because it doesn’t operate an ecommerce website, it is not included in Digital Commerce 360’s Asia Database.
Catch up on Digital Commerce 360’s daily recaps from the 2024 NRF Big Show:
- Here’s what you missed from NRF Day 1.
- Here’s what you missed from NRF Day 2.
- Here’s what you missed from NRF Day 3.
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