NRF 2018 Review: Retail’s Big Show
Written by Glynn Davis
Record-breaking numbers of visitors descended on New York City from 14-16 January for the 2018 edition of Retail’s Big Show, all in search of the latest technology solutions that they hope will help them navigate these very challenging times for the industry.
Organised by the National Retail Federation (NRF), around 35,000 people attended the retail IT jamboree over its three days this year, which included 18,000 retailers who travelled from almost 100 different countries to see the cutting-edge solutions showcased on the 1,600 vendor booths spread across the venue’s sprawling exhibition floors.
Sorting out the fundamentals
Although there was the usual smattering of robots and fitting room technologies employing interactive screens, there was also talk of a focus on sorting out the back-end, where single views of inventory and customers are now acknowledged as essential ingredients in the digital transformation process.
Speaking at an event running alongside NRF, Doug Gardner, CIO of River Island, highlighted the work done with Oracle on a Merchandise Financial Planning solution and how the company is now benefiting from having access to a central pot of data. This can be surfaced across the business – including onto store employees’ tablets, which gives them a real-time view of web inventory that helps with handling the likes of Click and Collect.
“There is also the ability to see where returns are going and to see how actions – like promotions – are affecting returns. What we‘ve realised is that the data is all over the place, it’s very volatile but we now have this visibility,” he explained.
Todd Sprinkle, chief digital officer at QVC, also revealed how the business had worked hard to bring the various channels together and had developed a Digital Analytics Responsive Technology (DART) that required “teams from across the business to read and react to what the customer is doing by turning information into decision making via dashboards”.
Solutions that use data for decision making were certainly prevalent at this year’s NRF – and they were most visible with in-store technologies. Kiosks and ‘clienteling’ solutions were widespread and highlighted how the physical store looks set to continue to play a major role in retail. Many of these solutions use artificial intelligence (AI), which was absolutely inescapable this year.
Prevalence of AI
So prevalent was AI in fact that Chris Palmer, cognitive offering lead at IBM, suggested: “There is much hype around AI. We‘ve had successes with Watson but I tell the teams to talk realistically. There are some companies who are over-promising. We’re turning a corner whereby we know where AI works and where it does not.”
He highlighted the success of chatbots that IBM has created for the likes of Shop Direct, Macy’s, North Face and gifting retailer 1-800 Flowers, but what particularly excited him now is the prospect of using AI for handling inventory on an hyper-localised basis.
“We’re looking at the retail store and finding that so many sales are often localised. We can determine what items can go into a store based on [local] events and weather. We can quantify the effect these various elements have on potential sales and undertake product mix optimisation,” explained Palmer.
He added that IBM has been working with the likes of Unilever and has found that net sales have increased 3-5 per cent when creating hyper-localised store formats and product assortments.
AI is also being used to improve decision making in-store by Volumental, which has developed a solution for measuring feet to within 1mm accuracy. The measuring hardware can be hooked up to over 40 tablets and store employees can view shoes that fit individual customers, as well as use AI to determine recommendations based on a person’s shopping history and other similar customers.
Using AI for smart recommendation is the plan for confectionery chain Lolli and Pops, which intends to roll out a solution using RealSense facial recognition software from Intel. This recognises shoppers when they enter a store and can surface a photo of them, their previous purchases and product recommendations onto store employees’ tablets.
Facial recognition is becoming a force
Facial recognition was big news this year at NRF, with many examples of the technology being embedded in solutions. Ryan Parker, Internet of Things retail solutions division at Intel, says Wal-Mart has been testing a digital shelf-edge label solution from AWM Smart Shelf that recognises if a customer is close by and will display pricing on the shelf edge, whereas if they are standing further away promotional materials are displayed.
“It can also recognise if a customer is Hispanic and will change the language accordingly. We’ll get to the point where retailers will know individual shoppers and can build algorithms to drive messaging to them. They could store a photo of them on the system – on an opt-in basis – and do personalised offers,” he suggested.
Innovative burger restaurant CaliBurger is also just about to roll-out an AI-enabled self-ordering food kiosk that uses NEC’s NeoFace facial recognition software to identify a customer when they enter the restaurant. It then opens up their loyalty programme on the screen, which contains their preferences and enables them to place an order. The plan is to also accept payments through facial recognition verification.
John Miller, CEO of Cali Group, which operates 50 CaliBurger restaurants around the world, said: “It reduces labour costs and provides data acquisition so we can gain demographic information and use AI to train the system to be able to not only determine if the customer is male or female, but to also know if they are happy or sad.”
Robotics finding real uses
Cali Group has also been working hard at robotics and has developed ‘Flippy’ – a robotic arm with AI capability. The technology takes visual data and makes constant minor adjustments to the robotic arm’s movements depending on factors like the position of the patty and the speed the food has cooked.
However, robotics were not particularly prevalent this year at NRF – the days of vendors demonstrating dancing robots in the aisles seem to be over – but the one area where it is finding some traction is with inventory management.
Bossa Nova was showcasing its autonomous on-shelf inventory scanning robots that are in use at 50 Wal-Mart stores in the US. The robots move up and down the aisles of the stores collecting images of the products on the shelves, reading the labels on the shelf edges, and scanning RFID tags to undertake a full stocktake as well as identify any compliance issues including incorrect pricing and products placed on the wrong shelves.
Don’t forget the people
As the industry becomes ever more reliant on new technologies it was interesting this year at NRF to hear talk of the importance of shop floor employees and the essential role they will be playing in retailers’ digital transformations.
In one of the keynote presentations Doug McMillon, CEO of Wal-Mart, highlighted how the company had been increasing employee wages and improving the level of training given, as it was understood that if the business was to be successful in the future then it would need its employees to embrace new technologies.
It would be sensible for all retailers to adopt such a people-centric strategy because technology alone will not determine their future success. Employees remain as important as ever, if not more so, especially when they are working in harmony with the latest technology solutions.