Tony D'Onofrio
Retail
38,000+ Attendees, 16,000+ Retailers, 800+ Exhibitors, 100+ Sessions, 99 Countries
Let me open by sharing the video summary provided by the USA National Retail Federation (NRF) of this year's edition.
This entire week, over all my social media platforms, I am publishing multiple other NRF 2019 summary reviews. Primarily from an Expo floor perspective where billions of innovation dollars are being invested, here are my impactful retail transformational takeaways.
IoT is not Just a Buzzword
NRF 2019 confirmed that the Internet-of-Things (IoT) is moving from a buzzword to solving industry problems. Solutions were visible all over the Expo floor.
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The future of retail includes digitally supported leadership branding coupled with hyper-personalized immersive consumer experiences. Of all the stores that I have visited to date around the world, the Nike House of Innovation in New York City, is the closest example that meets this critical futurist success formula.
Covering over 68,000 square feet (6,373 square meters), this new Nike flagship offers six floors of differentiated physical to digital experiences. Each floor could be a store of its own. Combined, this location is designed to meet the ever changing needs of a digitally empowered consumer.
Before taking a virtual tour of the store, let's remind ourselves of why shoppers buy in physical stores (IHL study):
The Smartphone as the Portal to the Physical Store
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Welcome to an uncertain and conceivably risky 2019. Despite multiple global hints of slower growth, I remain optimistic by the potential of the New Year.
On the horizon are multiple statistical landmarks that will "concentrate our minds". In 2019, half of the world will be online, India's GDP will overtake that of the UK, Nigeria's population will reach 200 million, and in USA millennials will outnumber baby-boomers to become the country's largest generation for the first time.
Inspired by one my favorite annual Economist editions, "The World in 2019", this post summarizes important global economic forecasts and looks at a few emerging risks. Timely to the upcoming NRF 2019 in New York, we will also discuss expected technology disruption and the positive prospects for the global retail industry in the New Year.
Economic Indicators Point to Continued Global Growth
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This past week had the opportunity to visit the new Amazon Four-Star physical retail store in New York City. Located in the chic Soho neighborhood, collectively the items in this store have an average rating of 4.4 stars.
Visually let's walk through the store, read some early reviews, and understand why this is a worthy customer experience experiment on the road to the future of retail.
The Four-Star Reviews Are In
"It had $20 kitchen mittens resembling dog paws, $16 USB cables, a corn kernel stripper for $7.99, a $15 mug that reads “Believe in yourself.” Oh, and some Alexa stuff...sell quirky, random items - not low-price, everyday household goods - i.e. it isn't directly competing with Walmart or Target." - BuzzFeed
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Five Reasons FREITAG Epitomizes the Future of Retail
Retail inspiration can be found in every corner of the world and for this blog post we visit Switzerland. FREITAG is the quiet Zurich based fashion accessory brand selling over 300,000 of its unique products across the globe every year.
"In 1993 graphic designers Markus and Daniel Freitag were looking for a functional, water-repellent and robust bag to hold their creative work. Inspired by the multicolored heavy traffic that rumbled through the Zurich transit intersection in front of their flat, they developed a messenger bag from used truck tarpaulins, discarded bicycle inner tubes and recycled car seat belts.” Their first core product became a designer bag with a conscience.
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Frictionless secure commerce coupled with immersive customer experiences have been on my mind for some time. Engaging with an in-store geolocation security company and new updated data on internet connectivity, growth of smartphones, and the Internet of Things (IoT) inspired this post.
Future consumer in-store interactions will include autonomous digital conversations with physical products. As discussed in a previous post, increased digital interactions will create brand ambassadors of both consumers and store associates.
For those individuals focused on securing commerce, that same digital exchange will lead to innovative applications such as geolocation solutions that will dramatically reduce retail crime. As an example, the geolocation security company mentioned above has so far in 2018 taken nearly 600 criminals off USA streets and led to the recovery of over $5 million of in-store physical assets.
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Welcome to Dubai or as CBRE calls it, the key stepping stone for international brands entering the Middle East. Over the next three years, more than 1.5 million square meters of new retail space could be delivered to the Dubai market, adding roughly 50% to existing inventory.
Being on the Board of Advisors for the upcoming Dubai Smart Stores Expo and having personally experienced the vibrancy of Middle East on multiple occasions, it is time to revisit this region and explore its global retail possibilities.
The Digital Transformation of the Middle East
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The State of Retail RFID
Retail is not dying. Today's consumers are being presented by an increasing number of shopping options. Online versus in-store engagement trends are converging and technology is increasingly the differentiating element.
A recent IHL research study titled "Out-of-Stock, Out of Luck - How Retailers Alienate Customers and Lose Billions Due to Poor Inventory Practices" prompted this relook at retail RFID. The top answers as to why consumers still prefer to shop in-stores include: want / need the product immediately, desire to touch and feel the item (try it on), don't want to pay expedited delivery charges, support local retailers, and convenience / easier than online.
Fast checkouts and products being in-stock are the two most relevant components of positive instore experiences.
A Different Kind of Amazon Effect
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Future of Retail with the Top 5 Apparel, Luxury, and Technology Brands
Being a firm believer that branding is a critical component to the future success of all companies, every year I look forward to the latest edition of the BrandZ Top 100 global brands report. Disruption, disintermediation, and differentiation are the three words that stood out in the nearly 300-page 2018 edition.
2018 Global Top 100 Brands Highlights
With an increase of 21% in 2018, the BrandZ global top 100 brands added a record $748 billion, to reach $4.4 trillion in total value, an increase of $2.9 trillion since 2006. 2018 set a record as the largest one-year value increase in the 12 years publishing the global report.
Every industry category had an increase with retail rising the most and for the second consecutive year in a row. The brand value of the retail sector rose 34% as e-commerce brands spiked in value and the category adjusted to disruption.
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Welcome to Retail Shrink Reporting Week
With the USA NRF Loss Prevention Trade Event taking place this week, it is time to revisit the new Sensormatic Global Retail Shrink Index published earlier this year. Covering 14 countries representing 73% of global GDP and 80% of global retail sales, it is the authoritative document on worldwide loss prevention trends.
In 2017-2018, the cost of retail shrinkage was $99.56 billion for the countries surveyed. This post focuses on my two favorite charts from the entire study.
Highest Shrink Rates Across Verticals and Countries 2017-2018
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It is a Small World
To begin the year with something fun, we travel to London UK to learn something new about Harry Potter. J. K. Rowling, the author, and Harry Potter share birth dates on July 31.
The houses of Harry Potter’s school, Hogwarts, were invented on an airplane sick bag while the author was traveling. Stephen Spielberg almost directed the first Harry Potter film.
The Harry Potter spells are in Latin. J. K. Rowling insisted that the actors in the Harry Potter movies be British and/or Irish.
More than 500 million copies of the Harry Potter books have sold worldwide; more than 180 million copies have sold in the U.S. alone. If all the Harry Potter books ever sold were placed end to end, they would go around the equator over 16 times. The books have been translated in 80 languages.
Harry Potter’s name is typed out 18,956 times throughout J.K. Rowling’s books. To watch all the Harry Potter movies, you need 1169 minutes.
This picture is taken at King’s Cross station where in the series Hogwarts School of Witchcraft and Wizardry students catch the Hogwarts Express.
In the wizarding world, Harry and his friends get to the platform by dashing through a brick wall between platforms 9 and 10. Meanwhile, in the real King’s Cross, platforms 9 and 10 are separated by tracks, but you can find platform 9¾ on the wall in the station concourse.
It’s a new year. Dream big. Work hard. But most importantly remember that life is a journey not a destination. Turn on the light and have some fun.
Categories
Brilliant Research
IMF Global Economic Forecasts: Growth Divergent and Uncertain
Global growth is projected at 3.3 percent both in 2025 and 2026, below the historical (2000–19) average of 3.7 percent. Global headline inflation is expected to decline to 4.2 percent in 2025 and to 3.5 percent in 2026, converging back to target earlier in advanced economies than in emerging markets and developing economies. - From the International Monetary Fund (IMF) Read more
Smart Infographic
Visualizing How Americans Spend Their Money
More than ever, Americans are using debt and credit cards to fund these purchases. In the second half of 2024, household debt hit a record $17.9 trillion. At the same time, credit card debt surpassed a historic $1 trillion, climbing by 8.3% over the time period. - From Visual Capitalist
Insightful Videos
Why Food Prices Are Still So High In The U.S. -CNBC
As inflation cools considerably, prices for items like gasoline, used cars and energy have all declined accordingly. But food prices continue to outpace inflation, increasing by 28% since 2019. Read more
