Retailers’ 2023 success comes down to one thing: a modernized customer experience. What that means and how to do that well was all the buzz earlier this month at the National Retail Federation’s (NRF) annual conference. Global leading brands came together in New York City to discuss our industry’s great breakthroughs and innovations that will help retailers execute on this modernized customer experience.
Here are our biggest takeaways from NRF including how leading brands are taking their customer experience to that next level.
#1: Data Quality is Critical.
Technology can be instrumental in a retailer’s success, but it can also be a hindrance when retailers fail to use it effectively. When Petco CEO Ron Coughlin joined the company in 2018, for example, he quickly realized that they needed to focus on the metrics that mattered. While on-stage at NRF, Ron explained how leadership went from tracking 20 metrics to five.
“The first order of the day was corporate integrity,” Ron said. “We pushed data down to the store managers, making them general managers — the data was all being held at company headquarters — and held them accountable.”
With the ability to drive better data-informed decision-making, Petco can focus on setting themselves apart, like creating a one-stop-shop for price-conscious customers, and launching initiatives that drive revenue. For example, Ron noted the company is looking at potential areas of expansion, like the, “seven-billion-dollar addressable market with rural veterinary care.”
Whether it’s the metrics you track or the systems you use, more isn’t always better. Make it simple and use data to empower your decision-making.
#2: Change is Constant.
Retailers must always be ready for what’s next. As Greek philosopher Hercalitus said,“the only thing constant in life is change.” For supermarket chain Kroger, that constant evolution has been key to its nearly 140 years of success according to CEO Rodney McMullen.
“I always tell people that the only thing I know for sure is that people are going to keep eating. How they eat? I guarantee that will change,” Rodney said to NRF President and CEO Matthew Shay during an event session.
Rodney went on to say retailers must support these preferences in a way that’s reasonably priced, provides high value, and makes it easy for the customer. For Kroger, this takes form in an omnichannel approach via its digital and mobile offerings. Of Krogers’ customers who use delivery and pickup, 90% of them also shop in-store. Their customers shop how they want, when they want, which is essential to offering a frictionless customer experience.
Another way Kroger provides a premier customer experience is by putting themselves in their customers’ shoes. Knowing that their customers are facing financial challenges, Kroger started offering more digital coupons for the store’s brands. Since launching their curated coupons, Kroger customers have downloaded more than 1 trillion digitals coupons.
From digital coupons to mobile offerings, retailers can continue generating customer loyalty even as we all face what’s bound to be an increasingly turbulent financial year ahead.
#3: Know What’s Coming Back.
When COVID hit, everything paused for a good while. Confined to their homes, people rarely ventured out and retailers had to pivot accordingly. Now that we’re three years after the pandemic’s onset, things are changing once again and savvy retailers are keeping a close eye on these trends.
Look at LVMH Moët Hennessy Louis Vuitton, for example. The luxury goods brand recently acquired Cheval Blanc and Belmond to expand their presence in luxury hospitality. Travel is back, according to North America Chairman and CEO Anish Melwani. At NRF, Anish said that LVG made the acquisition to align with the significant increase in travel, which has resulted in more Americans shopping in Europe.
Whole Foods is another retailer keeping its pulse on customer behavior, specifically in-store shopping. With the retail industry’s in-store sales jumping 13.7% from 2019 through 2022, Whole Foods has big plans in 2023. Currently operating 50 stores, Whole Foods plans to open as many as 30 stores each year. During an NRF session, Jason said this growth aligns with their focus on delighting customers.
“We want a place for customers and associates to celebrate food together,” he explained.
A modernized customer experience today may look different from the one tomorrow. Petco, Whole Foods, and other leading brands made it clear that complacency is not an option. Our industry must continue evolving, learning, and pivoting to deliver an experience that delights customers, each and every time.