Beginning on January 11, the major players of the retail industry will convene in New York City for the National Retail Federation’s (NRF) annual trade show. The event, called NRF 2020 Vision: Retail’s Big Show, is a multi-day affair bringing together tens of thousands of industry professionals, thousands of retailers, and many prominent speakers and thought leaders.
The event is a veritable who’s who of the retail space and is brimming with the fresh ideas and trends sweeping across the retail world. With so much going on, it can be hard to separate the noise from the signal.
To help industry professionals identify the important topics that will likely be featured at the NRF conference, PaymentsJournal reached out to Raymond Pucci, director of Merchant Services at Mercator Advisory Group. While PaymentsJournal is focused on payments related news and insights, we do follow relevant trends in the merchant landscape. What follows are three topics that readers should keep an eye on at NRF 2020 Vision and beyond.
“Autonomous checkout is hot right now”
The first trend that is likely to feature prominently at the NRF 2020 Vision conference and throughout the new decade is autonomous checkout.
“Autonomous checkout is hot right now,” said Pucci. He explained how Amazon set the pace with its Amazon Go stores, creating a fast and convenient in-store experience that consumers have increasingly come to expect and desire.
Amazon first opened an autonomous checkout store in Seattle in January 2018. Since then, Amazon Go has expanded to 20 stores in major cities across the country, including Chicago, New York City, and San Francisco.
But Pucci was quick to point out that Amazon was not the only company investing in autonomous checkout technology.
“Several other autonomous or automated checkout developers have entered the market and have pilot stores in operation,” he noted. The technology is especially popular in convenient stores, as c-stores are oriented around quick transactions.
As a result, Pucci wrote in a recent PaymentsJournal article: “2020 is shaping up to be an expansive year for autonomous checkout.” In the article, Pucci detailed how developers of autonomous checkout systems, including Zippin, AiFi, and Standard Cognition, have been rolling out products throughout 2019. In 2020, keep an eye on “the cost effectiveness of system installation and the feasible range of store sizes,” wrote Pucci.
Integrated merchant mobile apps: It’s key to customer engagement
Since competition between merchants is fierce and constant, merchants are always looking for ways to differentiate themselves from competitors and retain customers. One key area that retailers are turning to are integrated mobile apps.
From ExxonMobil to Starbucks, companies are investing in mobile apps that combine loyalty points, payment functionality, and personalized marketing offers.
“Integrated merchant mobile apps are important since it’s become a key customer engagement tool for merchants across most retail verticals,” explained Pucci.
Many of these apps also enable users to place orders in advance, providing customers with a swifter checkout experience. When Dunkin’ expanded its mobile ordering capabilities towards the end of 2019, the company witnessed an uptick in mobile ordering and repeat customers.
This is evidence that if merchants are successful in developing integrated mobile apps, they will reap the benefits: Experts have linked effective apps with long term and higher spending customers.
Delivery services: A crowded space, a breakneck pace
The last area identified by Pucci is the fast growing space of delivery services. Delivery has long been an aspect of the restaurant industry, and delivery aggregator companies such as Uber Eats and DoorDash have made it easier for customers to get deliveries from more restaurants than ever.
But recently, delivery has caught on in industries outside of the restaurant industry. The major space to watch for expanded delivery services is the grocery industry.
With over $700 billion in sales across 38,000 locations, the U.S. grocery industry is massive, according to data from Mercator Advisory Group. So it is no surprise that the grocery industry is home to innovative approaches to delivery.
A range of companies have cropped up helping grocery stores offer delivery options, including Instacart, Peapod, and Shipt. “Now most, if not all, national grocery chains and the major regional grocery chains are jumping in with both feet on online grocery sales,” said Pucci.
In addition to traditional delivery offerings—where a customer places a grocery order and then someone later drops off the items—companies are experimenting with a variety of other options. For example, Walmart rolled out a home delivery service that accesses a consumer’s home and places the items directly in their refrigerator or pantry (the service is only available in select metro areas).
Another option is curbside pickup, which allows the consumer to place an order and then pick up the groceries at a designated spot outside of the store at a specific time. This helps people avoid the hassle of picking out items and waiting in line for check out.
Forecasts from Pucci peg online sales to double to nearly $50 billion within the next three to four years.
“Delivery services have become a major cog in the on-demand economy whether for meals, groceries, or merchandise” said Pucci. “This talks to the convenience and immediacy that consumers want.”
Conclusion
Similar to 2019, this year is shaping up to be a busy one for the retail world. Shifting consumer preferences are driving innovation and causing companies to offer faster, more seamless services. At this year’s NRF conference, many of these innovative approaches will be on display for the world to see.
Whether you’re attending the event or interested in the retail landscape generally, keep an out for autonomous checkouts, integrated mobile apps, and expanded delivery services, for these are just some of the major ways that merchants are trying to appeal to consumers.
