Get thousands of retailers together under one roof, and you might think they would constantly be talking about Amazon. That’s not the case anymore.
The threat from the biggest online retailer is just part of a hard-to-navigate landscape, one among many challenges facing retailers as they met this week in New York for their annual trade show.
The retail industry is bifurcated — both technology-focused and trying to understand customers better. These days, retailers seem more open to doing whatever it takes.
“We’re clear-eyed,” said Mike George, the new chairman of the National Retail Federation and CEO of Qurate Retail, which owns eight retail brands, including QVC, HSN, Zulily and Frontgate.
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Recent challenges such as offering fast delivery are “a given,” he told a full house at Jacob Javits Convention Center.
“Competition is fierce and intense. The battle is joined every day, and we know the reality that there’s a great divide,” with many retailers still struggling to reinvent themselves, George said.
The industry group has embraced nontraditional retailers, and several have formed partnerships. The National Retail Federation’s annual meeting had 40,000 retailers and technology suppliers in attendance and featured panels with Rent the Runway, which has partnered with Nordstrom, and thredUP, which is working with J.C. Penney and Macy’s.
The opening keynote speaker wasn’t even a retailer.
It was Microsoft CEO Satya Nadella, who said retailers must create their own “technology intensity” by taking technology tools they acquire and making them their own. Retailers need to build their own capabilities and trust with the rich customer data they accumulate.
“You have to decide what you do with that data,” he said. “You have the most valuable asset, consumer data.”
Walmart was on the main stage next. The speaker was John Furner, CEO of Walmart U.S., which has earned kudos and improved results by refocusing efforts on its 1.5 million employees. Walmart enjoyed decades of being the primary threatening force, the spot Amazon now holds. Now, Walmart is viewed by its peers as the one retailer that has figured out the landscape.
But, Furner said, “We never want to say as a retailer that we’ve figured things out, because the customer keeps changing.”
The retail federation gave its top annual “visionary” award to the chief executive of a department store, a category that has suffered market share declines for decades. Kohl’s just reported holiday sales that were shy of expectations, but CEO Michelle Gass is making strides, and Kohl’s 1,160 stores are still profitable.
Kohl’s got a lot of attention when it started accepting Amazon returns in its stores. While that arrangement is bringing in more traffic, Gass didn’t quantify the impact, saying only that some of those Amazon customers are staying around and shopping at Kohl’s.
Retailers are an optimistic bunch, even when the industry is in the midst of a major transformation. They are plowing ahead with new ideas and technology and finding their way into the future, including new stores.
Erik Nordstrom, co-president of Nordstrom, said he worried that New Yorkers wouldn’t line up to see its new flagship store that opened in October. The retailer spent seven years planning and reportedly as much as $500 million to open in Manhattan.
Some 85,000 people showed up that opening weekend, he said, “and it’s still going great.”
“We’ve been in business all our lives and all the changes keep it interesting, but we — Peter and I — still have a passion for stores,” he said, referring to his brother and co-president Peter Nordstrom. In justifying the investment, Erik Nordstrom said Manhattan is the retailer’s largest online market.
Source: Dallas News