Seven Trends for the Retail Industry in 2023

By Meghan Hall |  January 19, 2023

The National Retail Federation just wrapped up its 2023 conference in New York City. More than 35,000 attendees gathered together to scope out hundreds of booths; hear from top executives at companies like Macy’s, Target, LVMH, and Whole Foods; and read the tea leaves together as a potential recession looms. 

Seven big trends emerged at the conference, from AI to expanded worker benefits to same-day delivery.

Attendees interact with Amazon’s Just Walk Out demo store. Just Walk Out enables consumers to enter using a credit card or Amazon One, which uses AI to allow for palm pay. Once a consumer has made their selections, true to the name, they just walk out — no need to stop by a cash register. Motion-tracking technology and shelves with weight sensors charge a customer’s selections directly to the payment method they used when they walked in.

1. “Frictionless” everything. Among the hundreds of booths, vendors demonstrated frictionless checkout; frictionless try-on; frictionless delivery; and frictionless ordering systems.

Toshiba and Pop ID showed off the Pop Pay system, which allows consumers to pay via facial recognition. The Amazon Web Services booth had a small version of the company’s Just Walk Out stores, which support shopping without stopping at a cash register. Meanwhile, Samsung, partnered with London-based Texel, allowed conference-goers to try smart mirrors — making it easier to quickly see how an item of clothing looks before you make a trip to the dressing room to see if it fits.

Sony recently launched its AITRIOS AI solution, which uses small IoT visual sensors to track motion for a number of use cases. One use case enables grocers and other retailers to detect gaps on their shelves. Once AITRIOS detects a gap, a retailer can send frontline employees out to replenish stock throughout the day.

2. AI and analytics. A number of booths showcased technologies that allowed retailers to track the number of customers in a given area of a store; use scales integrated into shelving to better detect shoplifting; or quickly spot gaps in inventory that needs to be replenished on shelves and racks. 

3. Retaining frontline employees — whether they work in stores, factories, trucks, or otherwise. Many retailers are providing increased benefits to reduce turnover— like fertility care, in Petco’s case; offering college education programs, as PepsiCo is actively doing with about 1,100 frontline employees; launching artisan apprenticeship programs to teach skills, as LVMH has done; and automating processes to make their jobs easier. 

Nuro, a Mountain View, CA, based startup, is operating small autonomous delivery vehicles on the roads. It makes deliveries on behalf of companies like Domino’s, Kroger, Walmart, and Uber Eats. When the vehicle comes to a customer’s house, they use a unique PIN to open the compartments and receive their delivery.

4. Last-mile delivery. Walmart touted its GoLocal offering, which allows consumers to receive goods the same day, powered by Walmart’s own Uber-like delivery driver network. Target, on the other hand, was represented by a company it owns, called Shipt. Shipt does deliver Target products, but it also delivers goods from other retailers, like Petco, Abercrombie & Fitch, Rite Aid, and more. 

Startups have also gotten in on the fun — Nuro, an autonomous vehicle company operating out of Mountain View, California, is putting small, no-passenger vehicles on the streets to deliver goods from grocers, convenience stores, and chain restaurants. 

Epson’s self-serve coffee kiosk gave its users the option to print a customized, colorful label — in this case, a “Thank You” latte that comes from Doug Strahler.

5. Personalization. Retailers are implementing new AI systems that allow them to better cater to consumers’ tastes, leveraging data from website usage, loyalty programs, and past purchases. In other cases, the personalization is driven by the consumer. Epson showcased a coffee shop kiosk that allowed users to print customizable, colorful coffee cup labels for occasions — like “Thank You” or “Happy Birthday,” with shop branding and an individual’s name.

6. Sustainability and the circular economy. Offering more sustainable products and packaging was a major topic. L’Oreal Chief Sustainability Officer Marissa McGowen said the company has looked at a number of solutions, like ensuring packaging is viable for circular economy usage or refill-style systems. Jeff Hogue, Chief Sustainability Officer at Levi Strauss, said his company has ensured their products are “made to be made again.” He said that means using materials that can easily be pulled apart to make new products in the circular economy. He also explained that, in apparel, a number of different retailers may be using the same third-party production site. When some brands want the factory to become more sustainable by taking one action, and others have opposite ideas, it may cause no movement at all. He said, in these cases, retailers need to band together to determine a solution that moves all of them toward sustainable production — and that may require investing capital in the third-party supplier to incentivize the change.

7. Brick and mortar isn’t dead. Despite recent headlines about the struggles of retailers like Bed Bath & Beyond and Party City, keynote speakers, sponsors, and attendees alike emphasized the importance of omnichannel. Giving consumers the option to go to a store in person, try on clothes, and interact with frontline employees still matters, they said. Macy’s CEO Jeff Gennette said the company would be opening more of its Market By Macy’s small-format locations, even as it closes larger stores. By focusing on omnichannel, rather than investing primarily in e-commerce, companies said they can build more brand loyalty and benefit from multiple ways to get customers’ attention, time, and money.

Featured image courtesy of the National Retail Federation, captured by Jason Dixon Photography.