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3 Takeaways from NRF Converge: Quick-Hit Quotes from Sephora, Walmart, Zappos and More

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After nearly 18 months of seismic changes and Olympics-caliber pivots, retailers are beginning to take a breath and examine what’s happened to the industry — and even more important, what’s going to be most vital moving forward. Executives from a who’s who of retailers, social networks and even advocacy groups shared their visions of retail’s future at NRF Converge 2021, held June 21-25. Key themes that emerged from the dozens of presentations include:

  1. Actualizing Diversity and Inclusivity: From the makeup of their employee base to the marketing and merchandising decisions brands make, the industry is taking concrete steps to make diversity a reality;
  2. Meeting Shoppers on Their Terms: A matter of survival during COVID-19, this trend shows no sign of slackening; and
  3. Changing Corporate Culture: With the volume and pace of change taking place, retailers are taking a fresh look at how technology is used, decisions are made and goals get accomplished.

THEME 1: Actualizing Diversity and Inclusivity

Following the murder of George Floyd in May 2020, brands and retailers were eager to show solidarity and support. While initiatives such as the 15 Percent Pledge have been rolled out to improve transparency and accountability in the retail world, many companies have spent the last year looking inward and ensuring that their customer-facing messaging and experiences mirror the internal company culture.

For example, Gap Inc. and Sephora both did active internal and external research to better understand the experiences of the black community. They developed ongoing listening sessions, conducted surveys and task forces to shape their approach and ensure they were allocating time, people and resources to the issues that truly mattered. At Gap, training was a priority to ensure managers could “build their inclusive leadership muscle” and all employees could become better allies. For Sephora, extensive work was done to ensure that all areas of the organization, from marketing to supplier and brand partnerships, reflected their company culture and vision.

“There’s the outside piece [of the strategy] and there’s the inside piece. What we did in the past 12 months or more is we identified who we wanted to be, and we created a roadmap for what that looks like. As a retailer, we want to be a place where you can come in and be yourself; inside we had to match that.”

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– Corey Yribarren, EVP, Chief People Officer, Sephora, from the session:
The Pursuit of a Diverse and Inclusive Workplace

“When we launched our commitments last year, many of our teams wanted to jump right in and develop initiatives like mentorship programs, diverse goals, etc. We really had to pause and say we need to create space to listen and learn from our communities of color. We took feedback from those listening sessions, along with our data and employee survey sentiments, and we used that to identify what to focus on in terms of our efforts.”

– Maria Febre, Head of Employee Belonging, Gap Inc., from the session:
The Pursuit of a Diverse and Inclusive Workplace

While discussions on diversity, inclusion and social responsibility have come to the forefront in retail over the last year, the billion-dollar market for adaptive and inclusive apparel remains largely untapped — but that’s changing.

“In order for us as a company to provide the best customer service — and that’s really our core DNA — we have to continue to include people with disabilities in the discussion, throughout the entire process, whether it’s facilitating focus groups to better understand what the needs are around specific products, or using and hiring models with disabilities to showcase the products that we are selling on our site. We also work with influencers with disabilities to help spread the awareness to their communities and abroad. And last but not least, we work with other like-minded organizations like Runway of Dreams. When we had our fashion show, we were able to really open up the door for brands to see the fashion show and models with disabilities.”

– Dana Zumbo, Business Development Manager, Zappos, from the session:
Design for All: Time to Amplify the Inclusion Agenda

“I am inspired every single day by Gen Z. Somebody called them Gen Me because they’re their own brand, and Gen We because they care about everyone and everything. They’re one-quarter of the U.S. population and one-third of the world population. They have a strong point of view when it comes to the environment, inclusion and representation. It may be an inconvenience for corporations to listen to them, but you’re going to be irrelevant if you don’t care about gender ID. They care about abilities, they care about creating spaces for all of their friends and their colleagues and people they don’t even know, but they want to fight for them. If you’re really smart, sit down and listen to them — and if we listen to them, we’re going to have a much better future and healthier business.But do the hard work, and it is hard work.”

– Rob Smith, CEO and Founder, The Phluid Project, from the session:
Design for All: Time to Amplify the Inclusion Agenda

“Words matter. One of the first pieces of research we did when setting out on our adaptive journey was speaking to the customer about words, language — how do they search, what are they looking for, how do we offer up this product. One of our biggest barriers outside of figuring out the language was just understanding the consumer journey, how to create marketing assets that support that journey. It was all about test, learn, iterate. We learned that we couldn’t make assumptions. We also learned it wasn’t our role to prescribe the product or solutions that our customer needed. Our aim was always to educate and guide through our marketing — we introduce the concept of the line, the various solutions that are available and then empower the consumer to select the styles and solutions that are most applicable for their style and the needs that they have.”

– Sarah Horton, Senior Director, Innovation and Integrated Marketing, Tommy Hilfiger, from the session:
Design for All: Time to Amplify the Inclusion Agenda

THEME 2: Meeting Shoppers on Their Terms

Social networks have become critical touch points, but they often require brands and retailers to adopt a different mindset. For example, people come to Pinterest with ideas, but they don’t necessarily know what they’re looking for yet: 97% of searches on Pinterest are unbranded. This presents a massive opportunity for marketers to reach consumers earlier in the journey, before they’ve made up their minds on a particular brand. Additionally, most searches come in at one to three words, e.g. “New makeup ideas” or “Creative wallpaper.”

“We’ve been on a multi-year quest to help people buy nearly everything that they find on Pinterest and to give merchants the tools to connect with those eager Pinners. So right there you’ve got yourself a marketplace, but we’re also trying to be a lot more than that. We’re trying to meet people much earlier in their shopping journey than a typical marketplace sees them, and the reason for that is, in our view, so much of the online shopping experience lacks a certain je ne sais quoi. It’s find the thing, buy the thing, but where’s the fun in that? We’re trying to bring the fun to online shopping. In our ontology there’s shopping and there’s buying. Shopping is fun; buying can be a little bit of a chore. Because Pinterest provides a commercial experience with commerce right at the center, not a social experience with a commercial experience bolted on, it can preserve some of that serendipity, the discovery, the fun of online shopping.”

Jim Habig, Global Head of Business Marketing, Pinterest, from the session:
Pinterest, The Yes and Crate and Barrel Leverage the Next-Gen Marketplace for Growth

“The pandemic has certainly shifted people’s behaviors and their expectations from brands. One of those is a desire for more meaningful, purposeful experiences. Whilst shoppers have been able to engage with virtual experiences for the past year, shifts online have raised the bar around convenience as shoppers return back to stores. We anticipate that they’ve become even more discerning about what they’re looking for, so effectively the bar has been raised for brands that deliver on meaningful experiences. At The LEGO Group the brand mission is about learning through play, and so part of our DNA has always been about creating meaningful, relevant and positive experiences. We’re constantly assessing what excites [our audience], what their passion points are and how to engage them in meaningful relationships, because shoppers are now looking at brands for much more than a purchase, more than just convenience. They really want to feel part of a brand story and believe in a brand’s purpose.”

– Claire Waugh, VP, LEGO Retail Marketing Group, LEGO Group, from the session:
LEGO, Tailored Brands and PepsiCo on the New Connected Economy

“In the last 25 years, look at the internet, the MP3, Starbucks, any number of things that started to provide consumers with choice and the ability to curate their experience. Think about the convenience of Amazon Prime, Airbnb, Waze, Uber, GrubHub, all the things that surround consumers’ lives. They bring all of these expectations now when they think about convenience and we have to deliver against that.

Jeff Swearingen, Global SVP Demand Accelerator, Venturing, PepsiCo, from the session:
LEGO, Tailored Brands and PepsiCo on the New Connected Economy

AR technology has improved enough that applications are really working at removing friction from the online shopping experience, reducing returns, increasing consumer confidence and general consumer engagement. Brands and retailers across categories have embraced it to add more context to the shopping experience and, in turn, ensure consumer confidence in their buying decisions.

“3D merchandising and using 3D as a medium is going to be everywhere, there’s no doubt about it. Just like how you have an image that represents a product, you are going to have a virtual version of that image, which is going to be a digital product. Maybe it’s going to be complementary, maybe it’s going to replace it, but it’s going to be everywhere, and that’s something that we’re preparing for.”

Shrenik Sadalgi, Director, R&D, Wayfair, from the session:
How Wayfair and Sally Beauty use AR & 3D to Drive Inspiration, Confidence and a Cutting-Edge Customer Experience

“As you create these 3D assets, they become valuable in many different ways — your advertising, search results through web and mobile — so you can start to build a broader case for investing in this innovation.”

– Armando Ortiz, VP, Distribution Market Leader, IBM iX, from the session:
How Wayfair and Sally Beauty use AR & 3D to Drive Inspiration, Confidence and a Cutting-Edge Customer Experience

THEME 3: Changing Corporate Culture

Managing change at the speed and scale that’s now required, and operating in an environment where 2020 doesn’t provide any sort of meaningful benchmark to measure against, has forced many companies to look not just at technological solutions but also at how their own organizations operate.

“If there’s anything we learned over the past 18 months, and even before COVID, it’s that the marketplace is very dynamic, and consumers move really quickly to new behaviors. It’s been really obvious over the past year that they can move more quickly than organizations can react. It’s more important than ever for retailers, both ecommerce and legacy, to have the infrastructure in place that allows them to be much more flexible in their operations and merchandising and marketing efforts so they can roll with the punches. The days of relying on what happened last year to predict the future are long gone.”

John Gregory, Global Retail Category Development Officer, Spotify, from the session:
The Evolution of Ecommerce: How Brands are Evolving Ecommerce Models to Adapt to Consumers’ Changing Lifestyles with Stitch Fix, ThredUP and Spotify

“Prioritization became the linchpin of Bed Bath & Beyond’s ongoing turnaround effort. The retailer has found omnichannel success by narrowing down its goals to the most important factors. “I looked at the digital platform as well as the tech platforms that we had in play. We had a long stream of ideas; everyone was trying to chase their own agenda, so creating that singular prioritized agenda was a real tipping point. For us it was it was focus, focus, focus. We have to get that and apply it, we have to integrate this omni environment to be a service with ultimate ease and convenience.”

Mark Tritton, President and CEO, Bed Bath & Beyond, from the session:
Anatomy of Growth-Driven Transformation

Walmart sees voice commerce playing a huge role in retail in the coming years; shoppers will expect the ability to place orders from anywhere at any time, and Walmart is developing the capabilities needed to do so. “I envision a future where the devices that we have in our pockets are not going to remain the same. The way in which we interact with the device is going to become very different from what we are doing today. We’ll talk to our onboard personal assistant, he will know what we prefer and will help us solve problems. We will spend a lot less time typing, more time talking and listening.

– Suresh Kumar, Global CTO and Chief Data Officer, Walmart, from the session:
Technology That’s Transforming Retail

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