Midmarket Ecommerce Report Episode 2: NRF’s 2018 Holiday Forecast with Ana Serafin Smith

Midmarket Ecommerce Report Episode 2: NRF's 2018 Holiday Forecast with Ana Serafin Smith

Welcome to Episode #2 of the Midmarket Ecommerce Report! This is our new online show with a fresh format where midmarket retailers can see industry experts—from all sides—talk shop, cover trends and happenings, share the latest strategies, and much more. In episode two, we sat down with Ana Serafin Smith, Senior Director of Media Relations at NRF, and John Forberger of Forberger Communications.

Topics covered in episode 2:

  • What top retailers are exploring to maximize Holiday 2018
  • What’s ahead for midmarket retailers in terms of VR to attract consumers
  • How brand partnerships are changing how retailers online and off operate
  • Biggest surprise of 2018
  • What’s new and what to expect at NRF 2019 Retail’s Big Show & Expo
  • Holiday 2018 predictions (check back for how forecasts unfolded)
  • And much more

QOTD: What changes in 2018 will alter how midmarket retailers get holiday-ready and make the season a huge success?

Check out the full transcript of episode 2 below.

Midmarket Ecommerce: [00:00:05] Hey, welcome to the Midmarket Ecommerce Report. Joining us is Ana Smith from the National Retail Federation and John Forberger from Forberger Communications. Guys, thanks for joining us today.

Ana: [00:00:16] Yeah, thanks for having me.

Midmarket Ecommerce: [00:00:17] Let’s get right into it. As the midmarket retailers are soon going to lock in their sites in code freeze for the season, what are some of the things they should be on the lookout for as far as this coming holiday season to really make this their best year? Maybe Ana, we can start with you.

Ana: [00:00:32] Yeah. You know this year one of the things that we’re predicting for the holiday season is a very healthy and strong one. We are expecting the the holidays to gather up about 720 billion dollars for the months of November and December. That is a huge opportunity for retailers of all sizes. What we’re seeing right now is a lot of traction and combinations of in-store and online shopping, a variety of different tools that we are seeing retailers wanting to explore and they start exploring these as early as back-to-school, such as buy online pickup in-store, as well as chatbots and other things like that online. That’s allowing them to get ready for the holidays and be able to deliver a successful holiday season for their brand. I think we are excited to see what’s coming up in the next few months. You know a lot of retailers haven’t really announced what they’re planning on doing for the holidays, but I do think that we’ll see some exciting things coming from again all guys, big guys and the small ones when it comes to the holidays and make sure that they are making everyone happy and getting those gifts under that Christmas tree.

Midmarket Ecommerce: [00:01:44] John, want to add anything to that?

John: [00:01:46] Yeah sure. I think something we talked about prior to this episode recording was planning for the unexpected. Making sure that your team is flexible enough across all departments to take advantage of what’s coming that you didn’t see coming. Right. So you can do the fine-tuning of your landing pages, e-mail campaigns, PPC campaigns, that’s sort of the normal checklist-type things that were given out in guides, in lookbooks, white papers and items like. But to really see what is going to happen like Ana said is to me more of the exciting part, more than the planning for it actually.

Midmarket Ecommerce: [00:02:18] And what happened in 2018 so far that you think will have an impact on the holiday season? Ana, what kind of changes have you seen in the space?

Ana: [00:02:27] Yeah, you know it has been an amazing year for the retail industry and it’s mostly because of the fact that we have a really solid economy right now. The consumer is running on an all-time high and the last consumer confidence that came in was probably the highest that we’ve seen since the recession. And when you factor all those things in, we are seeing a lot of spending happening and so therefore retailers have been very, very, very happy this year. But the challenge is how much more will this go. Can this still continue on? Can this momentum continue during the holidays? And we do believe it will. But it is a combination of, you know, watching out to make sure that you have the perfect hires, seasonal hires for the holidays. And that’s becoming a little bit of a struggle for all retailers of all sizes, mostly because a lot of these seasonal employees, umm, a lot of these seasonal jobs sorry, are not being able to get fulfilled as quickly as possible as we’ve been able to do in the past. So retailers are getting creative in how they’re bringing in these folks into into their stores or into their warehouse distribution centers, or just to work for their brands in general, and it’s either you know giving part-time employees 401k’s, which they’ve never done, paid time off, again something we’ve never seen in this industry, to increase in wages to just stay competitive in flow to what we’re seeing across the entire industry. And that’s something when it comes to jobs in general that’s becoming a problem only for the retail industry, but also to a variety of other industries. I’m sorry. No no no I think I finished my point.

Midmarket Ecommerce: Okay, sorry about that. John, anything you want to tag in on that?

John: [00:04:19] Yeah, just one item that actually sort of follows up on what Ana said. I think these retailers are looking for more cross-functional team players than they’ve had in the past years. This is something that’s not completely new. But in the last year, seeing all the different platforms that are available to them, the amount of tools, again that we talked about prior to this recording, we talked about the amount of tools that are available to midmarket retailers and retailers of all size, and different segments. It’s just trying to figure out, trying to find the understanding of the team, their skillsets, their flexibility, and who could take on a bit more. And I think it’s going outside of the holiday season in terms of responsibilities and expectations than years, than prior years.

Ana: [00:05:01] Yeah and that’s going to be very, you know, I know you had mentioned we need to think about it more outside of the holidays. I think right now for the holidays this is the moment in time where the retailers are like, we need to make that goal for the year right. This is where we’re making our bread and butter right now in the next couple months. You need to be nimble you need to be very flexible and being able to have people put on a variety of different hats to achieve their goal and try on all the variety of different tools that are being sold to you to be able to have that successful holiday season, not only for yourself but as well at the end of the day for your customer, right. You are a retailer because you’re trying to appeal to a consumer and you’re trying to make them happy with you and build that relationship with them.

Ana: [00:05:42] We were talking preshow about some of the changes that you thought were coming up. So okay, if we can go back to that for a second. What are you excited about in the coming year? What do you think you might see a little inkling of around the holidays, and then maybe really took off in the coming year. What’s ahead? Let’s take a look at our crystal ball for a minute.

Ana: [00:05:59] Yeah. You know some things aren’t too surprising. We’re seeing a lot more virtual reality coming through from a lot of pure-play ecommerce brands. We’re also seeing, and that allows the customer to have the chance to say, alright does this piece of furniture right here does it really fit in my living room? Does it really look right? Or some folks are taking on, especially makeup brands, are taking on some of the hints that Sephora has used in over the last few years of does this lipstick look good on me and allowing that VR aspect to come to life. But then we’re also seeing a lot of these retailers take on opportunities of partnerships with pure-play ecommerce retailers, to take on partnerships with bricks-and-mortar stores. Nordstrom has over the last couple of years done some amazing partnerships with just ecommerce brands that come into their stores during the holiday season and do pop-up shops. We’ve also learned that this is something that, other brands like, sorry, Macy’s has also done over just for the holiday season, so we, I, wouldn’t be surprised if we see more of that come this holiday. But I think that that is an area of growth when it comes to ecommerce brands and that’s an opportunity for them to still pass the holiday season to continue on engaging with consumers. And if they’re not at this moment in their plans for the next year to have an opportunity to do a bricks-and-mortar partnership, whether it’s owning their own pop-up store or having a relationship with a larger retailer, then they’re going to miss out on a huge target market right there.

Midmarket Ecommerce: [00:07:39]: John?

John: [00:07:41] Yeah I think that, again, this is the third time I’m saying this, but prior to the recording, I want to highlight sort of how people are harnessing fears that they’ve had in the past years. They’re actually using them as assets now, where they may have seen a competitor do something and they couldn’t match it with the speed or an offer, whether it’s a discount, in-store, online, whatever it may be. Now everyone is pretty much on a level playing field, which to me is extremely novel. It’s fun to watch sort of the games that go around. But also going back to what Ana said around the partnerships, that’s something where people before may have had a little bit of a fear of, okay my profits are going to drop, and what else could go to the wayside. Do we have all of our backend operations connected, are they all lined up so we’re safe and ready to go. This is new. It’s also holiday, we could really disappoint tens of thousands of people if we do something wrong. But I think they are taking more risks and they’re realizing that they have to think outside the box.

Ana: [00:08:40] Yeah and that’s that’s definitely key. They, retailers nowadays the way they are they’re developing their business strategies is very, very different than what they did 10, 15, 20 years ago. Right. Twenty years ago, the thought of Kohl’s and Amazon ever having a partnership together was, it was like something that you, it was a sin to even mention in the marketing restricted or strategy room with the CEO. But now that seems like such a natural thing to do. And we’re seeing a lot more retailers, again large and small, talk to each other. Maybe not necessarily have a partnership, but they’re talking to each other to learn from each other and be able to grow, whether it’s together or on their own, and that’s super important nowadays. You know you want to make sure that if another partner of yours if they’re the exact same size, if they’re using Instagram in X Y Z way, how can you do it the same way or even better to target the audience that you’re trying to connect with? That we need to be more open-minded and be able to practice that a lot more.

Midmarket Ecommerce: [00:09:46] Well I want to get into Big Show really quick, but before we do, I’m gonna ask you a super quick question each of you. Biggest surprise of this year. Ana?

Ana: [00:9:57] Oh, wow.

Midmarket Ecommerce: [00:9:58] I know I threw you on the spot. I saved this question because I wanted to get the real answer.

Ana: [00:10:04] You know I think the biggest is, oww man. Honestly, this is going to sound funny and it doesn’t really impact the midmarket, well, it does. The biggest prize this year was Toys R’ Us was going away because what we’re seeing right now is everyone is trying to get a bite out of that part of the industry right. The toy industry that Toys R Us owned both online and in-store. And it’s not there anymore. So every single person again the mainstream mom and pop retailer to the large guys like Amazon and Wal-Mart, they’re trying to get a piece of that pie especially during the holidays to be able to win with the toy sector. So that was by far one of the most surprising things for this year.

Midmarket Ecommerce: [00:10:50] And what does that tell us about the industry, about the economy, whatever.

Ana: [00:10:57] I think one of the things that that tells us about the industry in general is that the industry is changing, and we’ve been seeing this over the last three years even more. And you know we’re hearing these headlines of that retail is dead but it really isn’t, it’s a vibrant industry, it’s a growing industry. But it’s changing very ,very quickly. And you know, if you are a retailer that is causing headlines at this moment, means that you weren’t catching up with the theme. The theme is play with the consumer, the way they’re shopping, how they’re shopping, connect with some for a variety of different partnerships and be able to engage with them. This is a consumer that loves engagement. If you’re not engaging, you’re going to be losing. If you are engaging, you’re going to be hugely successful.

Midmarket Ecommerce: [00:11:47]: Can’t argue with that. John, super quick, biggest surprise this year.

John: [00:11:51] You kind of put me, you put us both.

Midmarket Ecommerce: [00:11:54] Other than the question itself.

John: [00:12:00] I’m going to say, to me, I think it’s been the number of private label brands that Amazon has. I think the number is up to 80. I thought it was going be somewhere in like 40 to 50, and that people would say okay you know my category is okay. I’m okay over here in baby supplies. I’m okay over here in the kitchen. No. It’s not like that. The second, it’s a tied-in surprise, is also how people have been vocal about going head to head with Amazon. I think before, their strategies, they kind of kept it a little more to themselves, and you kind of had to read through the lines, like wait didn’t Amazon just announce something just like that a month ago. Oh now they’re doing it? Now it’s happening super fast. That sort of like, tit for tat, has been really really fun for me to watch.

Midmarket Ecommerce: [00:12:50] What does that tell us in your opinion about what’s coming?

John: [00:12:54] I think that people are able to move faster than ever. In short.

Midmarket Ecommerce: [00:12:59] See we got through that fine guys, right? You can’t ask a question about the biggest surprise and telegraph that move ahead of time. That violates the whole definition of the surprise, so great. And when we do our recap for the end of the year for Midmarket Ecommerce, I’ll ask you what the biggest surprise was and you guys can say that question. Okay, so let’s talk about NRF’s Big Show coming up. We’re very excited, New York Javits Center, January 13th through the 15th. John’s gonna be there, I’ll be there. Ana’s obviously gonna be there. NRF has a unique and unparalleled viewpoint being the largest retail organization on the planet surface, a huge footprint. Eyes everywhere, listening to what’s going on. So Ana, what do you think people should keep their eyes out for in attending Big Show? What will it change for a midmarket retailer for attending and why?

Ana: [00:13:44] You know the biggest thing about, and the greatest thing about Big Show is the fact that it is, yes it’s the largest retail trade show on the planet. That’s definitely a fact, but it also is a huge opportunity for learning, networking, playing with new tools that will allow you to be successful in whatever career path you have within the retail sector. And this year one of the things that we’re doing different is even adding an extra day of workshops. So if you specialize on cyber security and loss prevention, we are focusing a full day on just that and allowing you to network with other peers and learn from experts on what’s changing in that area. We’re also doing workshops just on food and food merchandise and marketing. And same thing, it’s for you to network with other peers with whatever title they are in their company, but to be able to learn from each other and grow with each other and set new plans for the upcoming year. But we have some awesome speakers lined up and I think that’s the part where a lot of folks come in for our show is to hear from speakers that are either you know up-and-coming, retail outlets to even the big guys that have been around for a while and hear what they have to say and the things that they’re doing to change to stay current with this very dynamic consumer. And so if you’re not at Big Show you’re gonna be missing out on a lot.

Midmarket Ecommerce: [00:15:16] You know, ultimately, you got to plug in, you got to get connected. So I’ll leave you guys with a final word about the holidays 2018. We’re a couple months from seeing how it shakes out. So prediction, first to Ana. It could be a surprise, it could be an interesting thing. We’ll just check back in with you, probably even on the floor of NRF at Big Show and say how well did we do with our predictions. But first anything you want to just put out there? Let’s take a look at the holidays from this side. What’s gonna happen?

Ana: [00:15:44] So for this year we are forecasting 4.3 to 4.8 percent in increase in sales from last year. Last year’s sales came in at about 5.1 percent over the year before. So our numbers are a little bullish but yet conservative. And the reason being is that all these trade war talks are making consumers a little bit nervous. So we do need to, that is the part that’s what’s making us nervous as well that consumers cannot go out there and shop as much or as crazy as they did last holiday season because of these conversations that we’re seeing in headlines and major news outlets right now. But I do still think that there’s an opportunity there for retailers to get creative with their promotions. We’ve seen year over year, retailers have dynamic pricing when it comes to the holiday season and I would not be surprised if that happens again this year. And you’ll want it, and I think overall I think it’s it to be a very healthy holidays. But yeah, let’s talk again in the next couple of months or even at Big Show and we can fully digest the results of the holiday season.

Midmarket Ecommerce: [00:16:57] Very good. John?

John: [00:17:00] I think that the highlights this year will actually be dialed back a little bit less than last year on mobile commerce. That was sort of a tipping point, was that more people shopped on their phone than years before. I think it was over 51 percent for the first time. I think we’re going to see more, more headlines and news coverage on physical stores because as people talk about, as Ana said before, this retail apocalypse thing, the numbers will tell the story. As we find out what’s happening in the stores over the next couple of weeks and months, I think that’s going to be a little bit of a twist because we’ve been so much talking about the technology and the consumer shopping behavior, what tools people are using, I think there’s a little bit of a back to basics of what others, what’s working in the stores that we’ve heard about all year long. You know who’s going to be doing something really great with VR in-store, what’s bringing people in, and then of course we’ll hear the normal stories around what’s working online. But I think that highlights this year will be focused, just like they have been the rest of the year, more on the big box names and what’s happening with them. Because I think people are watching that a little with a little bit of fear and scrutiny than years before, but we’ll see how it pans out for the midmarket and everyone else in the coming weeks. So Ana, we’ll reconvene over at Big Show for sure about it.

Ana: [00:18:22] Yeah sounds great. And by then hopefully we’ll have our final holiday retail sales results and we can talk more about those numbers.

Midmarket Ecommerce: [00:18:29] So Ana’s putting it at between 4.3 and 4.8. That’s the official word from NRF, National Retail Federation, at NRF.com. Check em’ out. And check out Big Show coming up at Javits Center, January 13th to 15th in the big apple. We look forward to seeing you guys there. If you see us come say hi. And we look forward to seeing you there, Ana. So Ana Smith from National Retail Federation, John Forberger from Forberger Communications, thank you very much for joining us on the Midmarket Ecommerce Report.

John: [00:18:55] Thank you.

Ana: [00:18:56] Thank you for having me.

Midmarket Ecommerce: [00:18:57] See you guys soon.

Ana: [00:18:58] Bye.

You can see episode #1 of the Midmarket Ecommerce Report here that covers how midmarket merchants can use AI. Our guest was Linda Bustos of Skava.

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