They don’t call it the Big Show for nothing. There were over 35,000 people in attendance from all over the world to talk about retail, technology, strategy, and the future at the National Retail Federation (NRF) Big Show in New York City January 15–17. The conference featured a wide range of keynote speakers, including Walmart US President and CEO John Furner, US Olympian Simone Biles, and executives from many well-known retailers, like Macy’s and Target.
One of the biggest takeaways from the show this year is that 2023 will be a year of required growth and adoption of new technologies. The pandemic is slowly receding and companies are operating in full force. Based on the energy at the show, this year we will see many interesting developments in retail. Here are four of the biggest trends I saw at the NRF Big Show that will impact retailers in 2023.
Digitization of the Physical Store
Digital transformation of stores has been around for a while, but we have seen retailers hesitant to commit to a full-blown adoption. Through a combination of solutions becoming sophisticated enough for large retailers to feel confident in adoption, along with the incentive to do things differently caused by the pandemic, security issues, and changing consumer behavior, 2023 is gearing up to be a year where we will see many businesses jump on board with digitization. We will see an increased use of RFID, a heightened focus on omnichannel customer experience, and interest in more granular performance insights.
RFID was more prevalent at the show than in the past. RFID technology is vital for retail because it allows for efficient inventory management and tracking. RFID tags can be placed on products, and RFID readers can quickly and accurately scan the tags to gather information about the products, such as their location and quantity. This can greatly improve a retail store’s ability to keep track of its inventory and ensure that items are in stock when customers want to purchase them. Additionally, RFID can also be used for security and loss prevention, allowing retailers to detect and prevent theft. Overall, RFID technology can help retailers improve their operations and increase revenue.
Along with interest in digitization was an increased focus on how technology can help with loss prevention and store security. The last couple of years proved to be challenging for many retailers, with shrink, employee safety, and store security at the top of mind for many executives looking forward to 2023. With every new solution showcased at the show, there was an interest in what it meant for store security. With the uncertainty surrounding the economy, each new piece of technology adopted in 2023 must protect the bottom line.
At this year’s event there was a strong focus on loss prevention in particular, recognizing its importance for successful operations. Solutions presented throughout the Big Show showcased how each could help mitigate shrinkage due to theft or mismanagement of goods—even if that wasn’t their primary purpose. It appears we have reached an elevated level of consciousness surrounding optimization methods like these within modern commerce.
“There was a major focus on technologies that improve and enhance the in-store experience of both the customer and employee,” said Bobby Haskins of Auror. “Retailers are looking for ways to ensure that each store visit is impactful and meaningful. Also, retailers are looking for ways to utilize all these new datapoints to reduce friction for green shoppers (good customers) and then also increase friction for red shoppers (bad actors).”
Incorporation of AI and Machine Learning
I may have said this in previous years, but I mean it this year: AI is no longer a buzzword. It was everywhere in the show and is no longer marketing jargon. The inevitability of AI was never questioned, it just didn’t quite fit into the budget or was missing the mark for store operations. But 2023 will be the year where retailers will begin the widespread adoption of AI.
We have already begun to see the adoption with tools like ChatGPT being used to write copy, AI-assisted image tools being used to edit product shots and create product prototypes, and AI tools being used to analyze security footage. These tools are not new; however, they recently have become available for free to the masses and are becoming more mainstream. While ChatGpt was not a focal point of NRF’s Big Show, it is a clear example of how machine learning is becoming more mainstream. In 2023, as businesses start to understand AI’s value, we will see it being adopted across all business areas.
Integration and Partnerships
Another theme was integration and partnerships. We saw many combined solutions where businesses relied on partnerships to execute solutions. Big names like Microsoft, Google, Salesforce, Toshiba, and Zebra highlighted their partnerships and how they worked with others, with many sharing booth spaces with their partnering companies.
These collaborations highlighted how businesses can work together to offer solutions that can address complex customer needs. Several talks focused on the importance of partnerships and how they are essential to delivering modern solutions that go beyond the capabilities of any one single business. These partnerships have enabled companies to create innovative products and services that meet customers’ ever-evolving demands. The conference was an excellent opportunity for many businesses to come together and explore the potential of combining their resources in order to create something truly unique. At the same time, it was also a chance to look at how existing partnerships can be strengthened and improved to ensure that customers get the best possible experience.
“With the prevalence of connected systems and devices, it is hard to find a device that is not part of the Internet of Things. This increased complexity caused by interconnectivity of technology and systems requires coordination from vendors,” said Padma Duvvuri from Dragonfruit. “To successfully implement solutions, partnerships are required.”
As stores look to digitize and incorporate AI and machine learning into their workflows, they will look for the low hanging fruit. Cameras, for example, aren’t just for taking video anymore—they are highly sophisticated sensors. A video feed of the inside of a store, which most stores use for video investigation, contains enormous amounts of valuable data. Paired with other solutions, that data provides retailers with valuable insights.
While the interest in leveraging video has been growing for the last few years, there was a much more excellent showing of computer vision solutions that were not just about traditional operational metrics but also on-shelf availability, stocks, and taking these to put them together.
AI-powered video analysis has the potential to revolutionize the way businesses operate, making them more efficient and cost-effective. It is clear that this technology has numerous applications, which are likely to increase exponentially as AI advances. While it is still early days, the potential for video to improve operations is immense and should not be overlooked.
I may be biased, but loss prevention is at the heart of this innovation. There is a heightened awareness of the importance of asset protection. With every new solution presented, there was an understanding of how it affected shrink. So many of the solutions showcased this year, although they were not necessarily built for asset protection, still addressed the common theme. I spoke to Dr. Read Hayes, director of research at the Loss Prevention Research Council (LPRC), and he said, “The LPRC team was especially busy this year meeting with high-tech partners, the Lowe’s anti-theft initiative group, and a full LPRC Kick-Off gathering.”
While digitization of the physical store, incorporation of AI and machine learning, integration and partnerships, and leveraging video were not the only exciting things at the Big Show, I felt these were the most prevalent in the loss prevention space. One clear difference from years past was the focus of store safety and shrink reduction.