Retail Empowerment: Tech Investments to Meet the Needs of Today’s Consumer

The power of e-commerce has taken on an unprecedented urgency, its necessity forced by the coronavirus global health crisis. And as physical retail takes a pause, merchants are still determining how their previous investments in omnichannel selling will support them during this difficult environment. In “Reimagining the Store in the Digital Age,” a webinar hosted by RIS and presented by Arm Treasure Data, RIS editor-in-chief Tim Denman and editor-at-large Joe Skorupa use findings from the RIS News 2020 Store Experience Study to share where today’s sellers stand in their tech investments, and how they can use these technologies to plan for their future. Learn more about: How retailers can personalize the store experience beyond location-based marketing Whether visualization technologies can really replace the store experience The value of empowering store associates AI use cases worth pursuing Retailers’ No. 1 priority coming out of the coronavirus health crisis Don’t miss these invaluable insights. The transcript and presentation slides are below. Tim Denman: Welcome everyone to the “Reimagining the Store in the Digital Age.” Thank you for joining us today. The store experience is being reimagined. What was once an engaging store concept could look tired and dated in just a few years' time. This is not a new retail idea — stores have always needed significant investment to keep fresh and provide the kinds of experiences customers demand. But in today's digital age, that timeline has been greatly accelerated. As customers increasingly embrace digital shopping, stores have been forced to find new innovative and seamless ways to merge digital and physical shopping. Joining me today to discuss the ongoing digital revolution in the store, as well as the current state of physical shopping amid all the craziness going on in the world right now, is RIS editor-at-large Joe Skorupa. Many of the points that we'll be discussing today were recently covered in depth in the RIS News 2020 Store Experience Study, which was sponsored by Arm Treasure Data. Before we jump into the research finding, it is important to point out to this research was conducted before the outbreak of the coronavirus. Obviously, the store experience is in a state of upheaval. In some parts of the country, just finding a store that's open and well-stocked is a cause for celebration. We will certainly address the ongoing COVID-19 crisis throughout this webinar, and I welcome your questions on the topic. But, as with all crises, this worldwide health crisis will eventually come to an end, and a level of normalcy will return to the world and the retail industry. And when it does, retailers will do what they always do: dust themselves off and get back to work. It's this commitment that will be the crux of our webinar today. We'll be exploring retailers’ long- and short-term technology investments centered around the store experience. The store experience study was conducted online in late 2019. As always, we targeted headquarter staff with a focus on director-level and above retail tech professionals. You can see a slice of the breakdown of the response on this slide. Obviously, we had a rather large respondents pull from the grocery segment, and a large number of respondents coming from the C-suite. And more than half of those that filled out the survey work at retailers with revenue north of a billion. This is the 17th year that we've done this study. I'm just going to pass the reins over to Joe, who conducted the research, has been writing this report for at least the last 15 years. And I'll go over the results and provide a look behind the numbers. Joe, take it away. Joe Skorupa: Thanks, Tim. And as you said, the research was conducted prior to the current crisis. But I think it's important to note that the two big questions in retail today are always relevant and even then, to a certain extent. And the two big questions are: What can we do now? And how can we plan for the future? And a lot of the answers provided here and the data points, answer those two questions. They shed light on what we can do now, and how we can plan for the future, not only for our own organizations' and stability. But, to me, what are trends going along in the competitive landscape, because it's always important to not fall too far behind. We're going to have instances here in the data points where we can see that retailers who have fallen behind in the current crisis are actually not going to be doing as well as those that had been keeping up with their long-term planning consistently over a period of time. And so let me go to this slide which shows the last-mile fulfillment. Now, whether you had last-mile fulfillment in place before the crisis, or not, but today virtually every retailer is a last-mile fulfillment retailer. And they do everything that's listed on this chart. In other words, where we see 30% for ship-to-store for pickup, and 30% for buy online, returned in store, 29% for buy in-store shipped from warehouse, and all the other things on this list. Back when we took the survey, these were the numbers of retailers that had those in place. And then you can see a year out and two years out. But guess what? Those figures today instead of being in the 30s and 20s, are in the 80s and 90s percent. The problem is that those retailers who made that leap without having the systems in place, they virtually had to deploy them overnight. They virtually had to deploy them manually. And instead of using robust IT systems, that have built-in logic workflow, and built-in compliance features for corporate industry and governmental standards, they're just sending messages out to store managers to ramp up ASAP with minimal guidance. Well, as you can imagine, this kind of hurried deployment leads to mistakes, and also leads to inefficiencies, stress on stores and employees. And yeah, basically, overall host of problems. Fortunately, customers are going to cut these retailers a break because they understand this is a crisis. But one thing retailers can't do in this hurry-up-and-do-it-now kind of approach. they can't ensure that these systems are profitable, or at least losing as little money as possible, because this is when you're late to the game. This is what happens to retail laggards. The last-mile trend has, let's face it, been emerging for some time. Retail leaders have been jumping on this bandwagon for some time — Target, Walmart, Kroger, Best Buy, others — and they're experiencing a huge jump in orders. And they're fulfilling them efficiently and profitably. And, unfortunately, laggards are not able to do that. So that's kind of a reality situation here. Obviously, last-mile fulfillment has never been more important. And we're going to see more and more retailers ramp up their systems with scalable technology after this crisis is over. So the next thing I wanted to talk about here is that, let's face it, this slide doesn't have earth-shattering data on it. But I do think it brings up an important point, and that is that retailers always, even in a time of crisis, should make plans along two simultaneous tracks. And the first one is short-term and practical, and this is kind of what this slide shows. You need to keep the lights on, the cash registers ringing, the store operating, and you need to serve customers every day in the best way you can. And many of these implementations shown here fall into that category. And guess what? All of those plans need to move forward. You can't fall behind and incur technology debt in these core areas. However, the second track that retailers have to keep focusing on even now, is on net new technologies, upgrades and legacy technologies that need to be transformed. And finally, innovative and experimental technologies that push retailers into new capabilities and business opportunities. Well, the second track which is not shown here, but we'll see more of it in a later slide, also has to be budgeted. It may not have the same budget and planning effort and resources thrown at it, that these core technologies have, but they both have to happen simultaneously because guess what? The future is always unpredictable, and while you can't really plan for it, you have to plan to be in the future otherwise you won't have one. Our next interesting data point from this study is that retailers are focusing their artificial intelligence efforts, both today and within the next 12 months operational areas. And I think this is an interesting data point, because clearly artificial intelligence can be effective. And many retailers have been thinking, "Well, let's get customer-facing technologies and artificial intelligence communication." And what we're finding here is that retailers don't trust that technology maturity up to this point. Customer-facing and employee sales assistance is not high on this list. And the reason is that it's still unproven. As a direct communication tool, we're still several years away from when AI can be an effective human communication tool. There's still too many risks today. So, instead, what retailers are focusing on are the core areas of demand planning, merchandise management, forecasting and planning, supply chain planning and execution, and marketing. These are operational areas. And that's where we see the bulk of AI and machine learning investments focused. Now, I did mention that one of the tracks that retailers have to invest in even as they invest in the meat and potatoes core functions is transformational technology. And one of the biggest findings in the study we found is that proximity or location-based marketing is the top investment in store transformation technologies. I think a lot of retailers, a lot of people listening in to the webinar today, would be surprised at that. We see that 25% of retailers have location-based marketing or proximity marketing in place today, and within two years, another 34% will invest in it. That's over 50% within two years. Those are big numbers, especially for a new and transformative technology. For years, we thought the so-called beacons were an option for retailers to determine shopper locations and stores, but beacons never really caught on. And instead what retailers realized is, they already have a way to track shoppers in stores — beyond traffic counters and doorways. They can use the shoppers' cellphone signals, when the phone pings for Wi-Fi connection, pings for a Bluetooth connection, connects the GPS or even change the cellphone tower. They're able to track all of that data, and use that information to gain a better understanding of traffic volume, as it relates to time of day. Flow patterns in store aisles, dwell times and locations and repeat visits. Marketing, promotion and store operations can be adjusted based on this valuable information. Also, as more shoppers use cellphones and go into stores that are able to track them, retailers can contact shoppers with alerts and messages as long as they gain permission to do so ahead of time. And many retailers are focusing on that very permission-gathering process. So once that happens, marketing efforts are becoming personalized, and aimed at influencing shoppers at the point of decision. The next slide that we have here is about the top three strategies in 2020, and I have a few things I want to say about this particular slide. These three technologies, in many ways, are no-brainers. We can see them as technologies that we should have been focusing on, that we were focusing on over the years, and this is something that is already in place. Well, guess what? It's not really in place. It's not really fully mature. It's not really a high priority of excellence in all retailers. It's still developing. How many retailers would be able to say they can personalize the customer experience to a high level throughout their organization? It's still a developing capability. And interestingly, the keynote speech from the recent NRF Big Show by Satya Nadella from Microsoft focused on these three strategies, as the top strategies retailers should look toward investing in, in 2020 and beyond. So it's interesting that while the CEO of Microsoft may have a vested interest in encouraging retailers to focus in certain areas. Well, it turns out that retailers named these three priorities independently, and before Satya Nadella's presentation. So just very quickly, we are going to talk about personalizing in a little bit. Inventory visibility has never been more important than today, than in the crisis that we're undergoing. And then, finally, I would like to say that empowering store associates in new ways through direct communication has probably been never more important. We've probably never seen a time when it was more important to actually get messaging, important messaging, direct messaging, immediate messaging to store associates and managers as well. This is certainly placing a burden on communications, we haven't placed at the HR systems. And no doubt that investment in direct store, associate communication is going to be a high priority in retail after the crisis. And one other interesting point is that most industries in the country have connected employees. Think about it — employees are connected everywhere, you're connected, I'm connected, everyone's connected. Guess what industry has a majority of its employees not connected in any way? And that is retail, store associates. Think about store associates, how are they connected to the enterprise? How are they connected communication? How many store associates have a corporate email address? And the answer is very few. And we've got to change that. And this is probably going to be the time that we think about doing it in the post crisis world. So, Tim, with that, I'm going to toss it back to you. Denman: Thanks, Joe. We're going to go now and talk a little bit about the key takeaways from the study. We had seven key takeaways that we found in the research. No. 1, a retailer should plan or match or surpass the level of growth predicted in 2020. According to our research there's going to be a 5.7% growth in revenue, and 4% rise in store openings, and a 3.4% increase in store remodels. Obviously, that was before the crisis struck, but you need to invest and continue to invest. Skorupa: Yeah, so let me just add there, Tim. That when we got this information, we got it pre-crisis, and it did indicate healthy growth in revenue and investment in stores and store remodels. And let's be honest, that is not going to happen in the way it was predicted because of the situation now. But the takeaway is that even in a crisis, as I've said before, retailers must make plans for the future. Retailers must make plans for ongoing stability, because guess what? Shoppers are depending on them to be there not only during the crisis, but when the crisis ends. So I think that while the numbers here for growth, for store openings or store remodels may not be the same as it was prior to COVID-19. I do think retailers cannot abandon all their plans. The smart ones won't; they will continue maybe on a lesser level than they initially planned. But, again, if you don't plan for the future, you may not have one. Denman: I think No. 4 is definitely worth bringing to the forefront, things that are going to be deployed this year. Mobile again, is the top of the list, and that's no surprise there for both managers and associates. And then also PLS: PLS is always a key point of investment even in times where there wasn't digital disruption. You're going to have to innovate with your POS every couple of years. It's on a regular cycle. So not really a huge surprise there. And then no technology has been more transformation than adoption rate or your proximity marketing, we talked about that. And there's actually some questions from the audience on that. Last-mile fulfillment we talked about that 30% currently have that, and as Joe's indicated these omnichannel fulfillment methods you'll pick up from store, ship from store. We're not sure what that number is right now, but anecdotally, it's like Joe said it could be in the 80, 90%. I'm on the East Coast, and stores are just basically closed. If you want to get something, you're going to have to get delivered or it’s going to have to be some kind of curbside pickup. Skorupa: I do have a few numbers on that. What I'm finding in a couple of different sources is that online shopping account registrations, and so that's like net new shoppers. In other words, shoppers that weren't online shoppers has increased by 1,200%. And mobile app downloads, remember, that's the best way for you to do shopping, instead of going to the website, do the mobile app. It's a dedicated area for shopping. Mobile app downloads for retailers has increased by 300%. So these are huge numbers. These numbers have increased so high that a lot of analyst firms, research firms, that predict what the future of shopping is going to be like, have predictions for the future. And they predict well by 2022, this percentage of the population will be shopping online, by 2025 this percentage will be shopping online. Well, right now, the response in the crisis has resulted in these analyst firms pointing out that the population percentages for using digital commerce shopping will reach levels that were predicted for 2025. Denman: We have a lot of questions in from the audience. The first one is about the location-based marketing like I talked about. Is there any particular store format Joe or retailer type that you find is more likely to successfully utilize this type of technology? Skorupa: Well, I will say that probably the most dramatic store-format transformation has happened with Best Buy. And Best Buy from a few years ago has totally revamped how shoppers walk through the store and the aisles. They've totally changed where they put products that they've kept such as home computer, and home op, and home workstation locations they've changed that. They've devoted a whole side of the store in most cases, to those kinds of products along with the Geek Squad, and they've totally reduced sizes of a lot of things to a certain extent. The music and the video and things like that, and increased other areas. So, that is one format that's really changed. And while I don't think we've seen it yet, I think that we're going to see a lot of formats in the grocery and mass market change because of what they're learning. I think the first areas that we see this occurring is how Target and Walmart are able to understand how to shrink down their 100,000- and 200,000-square-foot stores down to 30,000-square-foot stores and put them in locations. How do you do that with hundreds of thousands of SKUs, now all of a sudden, you're down to 20 or 30,000 SKUs. How do you make those decisions? Well, they make those decisions based on how shoppers are shopping in the stores and where they get the most uplift and their curating based on this kind of knowledge. Denman: Another question here, and it meshes perfectly what you were saying. Obviously, there's so much value to personalize the experience based off of preferences and also location. But retailers have struggled, and they continue to struggle, to get people to opt into those services. I realize this is a $20,000 question, but how could retailers kind of entice people to opt-in to these personalization apps? Skorupa: The first thing is to make their mobile app so compelling with terrific services, convenience, quick one click capabilities, that shoppers will want to download them. And, of course, when they do that, they're going to get the information they need for personalized marketing. That's a no-brainer. But I have to say I'm seeing more and more websites providing alerts when I go to their website, by asking for permission to block or not block, pop-up ads or block permissions, you're getting a certain number of people who actually click to allow permission, to allow pop up and communications and browser alerts and those are happening as well. And of course, smart retailers are devising campaigns. I mean, these are automated campaigns, they're certainly going to deliver a certain amount, but retailers who are devising opt-in campaigns, maybe even donation programs for charities especially today, there is no shortage of marketing approaches that can stimulate shoppers to allow permission to get their email address and to track them online. Denman: Another question here: How else can you personalize the store experience beyond location-based marketing? This also ties into some of the data for associates especially in the apparel space. The ability on the show floor to have recommendations in real time, to look at a person's past purchases and maybe recommend these shoes, because they match a shirt you bought in the past things like that. In your mass market areas, beyond just location-based and even at the POS: You could have two profiles in there, and someone comes up, you could offer a recommendation or a discount or a promo. There's many other ways to do it besides location. Skorupa: I bring up a store that I visited not that long ago, it's the Nike Melrose store, and it's an entirely personalized store. Nike covers every sport, right? You can buy footwear and clothing for practically every sport in the Olympics and you know how many events there are in the Olympics. But when you go into the Nike Melrose store, they have curated this down. And basically, what I saw was yoga, running, basketball, things that those in the city of Los Angeles would be doing. And it's not just the city of Los Angeles either; it was just that neighborhood, just that ZIP code. Those products were targeted for just that neighborhood. And Nike, of course, rolls out a number of new products. There are sneakerheads in the world that love to keep up with the latest, coolest, trendiest sneaker releases, and Nike actually announced releases in the store; there's actually a bulletin board there that tells people when the next releases are coming out, actually by date, and it goes into the future. Those releases that they announce are not just all the releases Nike has — they have way too many releases — they're only releases that relate to the shoppers in that neighborhood, in that ZIP code. And how are they able to know what those shoppers are likely to want? Well, one of the things is that Nike has, I believe the number is 100 million people who have given them permission to track them in their loyalty program, in their customers customization online program. And using that 100 million database, they're able to get down to a single ZIP code. So, that's the kind of personalization that can be done when you have the data. Denman: This next question takes us a little bit outside of the store to talking about product visualization online, in terms of videos and photos. It does tie back to the store in that if you came to the store, you could pick up that shirt or pick up those shoes and any product and actually feel and experience it. The question is: With all this new visualization capabilities, imagery and video, do you think that can suffice for complex products, just through static visuals? Visualization is still new, but should it be a top priority to empower buyers today? For example, a motorcycle buyer shouldn't have to visit the dealer to experience the options but should be able to configure build the bike they've always wanted. In terms of the motorcycle example, I think that technology is definitely available today. You could add options onto bikes or cars and see what it will do. But in terms of consumer products, yeah, I think it's difficult to truly experience a product online. There's a lot of this next-gen stuff — AI and AR that you can maybe see the furniture in your house, or interact with these products or try them on virtually. But that's the point of why the store is so valuable, why the store is still 85%, 90% of revenue is because people like to touch things. Skorupa: I think people make decisions and absorb information in different ways. Some people are visual, some people are verbal, some people have great capabilities of digital absorbers. Some people are much more absorbers of information when they get to be personal, and do face to face and I don't think it'd be one method. I think a smart retailer is going to use all of those tools that they have. However, to me the big takeaway about visualization is more about image recognition, and the capability that really is a mature capability unlike consumer-facing capability for AI and talking and chatting, etc. The one capability that has really matured recently is image recognition. And that is a great tool that retailers could use for search capabilities, finding products based on an image that shoppers can submit to a retailer. It's a great way to stimulate interactivity. It's a great way for a shopper to find products they want. It's a great way for retailers to get more personal and engage with shoppers. So I think that's the big area that retailers should explore in the field of imagery. Denman: This next question is specifically about the coronavirus: With the current crisis where most of you all work from home, but buyers are also at home, and with buy from home happening, innovations to better experience and customized products are desperately needed. What are your opinions on the best way retailers could adapt this? For me, this kind of harkens back to what Joe was saying earlier. It's tough to put in a personalization thing on the fly, and you kind of have to have it. I think people that don't have it now are struggling to get products to their customers. I don't know whether product innovation or product personalization is going to be happening in a time where people just need toilet paper, so to speak. Joe, what do you think about that? Skorupa: I think that the working from home, the ordering from home, the skyrocketing stats I pointed out for digital ordering and purchasing is a tipping point. I think that unintended and anticipated results from this are the potential slowdown of our internet speeds. I don't think that's happened at all in the United States. Although I have heard that some of the platforms corporations use — and this is not what consumers use, but the corporations use — have had slowdowns due to the fact that a phenomenal number of employees are now logging into these platforms than ever before, and the platform's hadn't anticipated this would occur simultaneously with so many organizations. So, that's one issue. Another issue is, well, how do you work on sensitive projects? Some industries have corporate secrets that are really, really crucial to their ongoing future, and they were able to be secure and have secure corporate meetings in their headquarters. Now that so many of our employees are working from home, what security tools do they have in place, they never anticipated? They would have to have the same bulletproof security outside of their headquarters, and they have inside of their headquarters. Now this is possible they just haven't done it. They have to figure it out on the fly now. So I think the working from home scenario is probably a bigger thing to manage organizationally for your distributed employees and for consumers. And I think consumers are just showing phenomenal growth in doing the shopping from home. I think retailers are struggling with operationally managing it. Denman: This next question is about how grocery retail bottom lines will ultimately fare during the crisis. On the one hand, demand seems to be extremely high, with people eating out less and being more reliant on store bought goods. On the other hand, you mentioned that many retailers are relying on expensive manual processes to support shopper behavior, and demand for things like delivery and curbside pickup. What do you think ultimately will be the impact on the bottom line? And I think we're talking strictly grocery here. Skorupa: I can remember as recently as two years ago, maybe more like two and a half years ago, there was a huge debate in grocery. And I was able to witness this because EnsembleIQ has tremendous coverage in the grocery field, with our sister publications, really comprehensive coverage. And at that time, there was probably equal weight given to the fact that grocers should not adopt last-mile delivery. That was almost like a 50% vote there among industry experts and advisors: “Do not go into home delivery.” The reason was because grocery is a razor-thin profit margin industry, and home delivery either eats up the entire profit margin or incurs a loss. And groceries had not to that point figured out a way to monetize the home delivery aspect. Now they did eventually, and they did leave that opinion. But that meant that probably more than half the grocers in the United States did not move toward home delivery until about two years ago. And so what we see then is that those grocers did not have full systems in place, did not have a capability to achieve profitability with their home delivery, and therefore they are really going to take a hit, even though their sales may be high, their profits may be surprisingly low. Denman: This next question is actually perfect to what you were just talking about. Is there a clear path to profitability for last-mile fulfillment that retailers can achieve either through scale or greater efficiency? I think it's similar to what Joe was saying. I mean, obviously shipping to the house is expensive, right? Look at Amazon's profits, and they've straightened it out recently, but you can see that they spent a ton of money on fulfillment, for the last-mile getting into the store and retailers as well. One way that they're trying to make that more profitable is getting people to come to the store and pick it up themselves, buy-online-pickup-in-store. So yes, there is a way to make it more profitable, to increase your margin on these items that otherwise you would have to have delivered or figure out what to get to the house. And now you get them into the store and potentially they buy something else. Joe is that how you feel that we can get more efficient? Skorupa: Well, grocers are pretty smart and once a grocer comes up with it with a brilliant idea. It's almost like "Ah." It's so easy. One of the ways to make it profitable is that when you shop online, for home delivery, you don't get the discount. So many stores have in-store discounts, which is where they should be, because you want shoppers to come into your store. So when you shop online, the store discounts which have typically shelf labeled signage, well guess what? They don't appear online. So now you're saving the discount that you had offered in your store; you're having shoppers buy full price, and when shoppers buy full price, that is a key to achieving profitability. Another way to do it is to get the right fee structure in place. How much are you going to charge for delivery? It can't be zero. There has to be some delivery fee — again, an obvious choice. And then, of course, you have the ability to steer customers to higher-profit products. Some products are store specials. They may not actually be on sale; they just happen to be a low price, and low margin for your marketing and mix purposes. Well, they may not be the ones that are recommended and related products, recommendations when online shoppers shop. There are so many ways to do this; a lot of them are really not that difficult. The difficulty it takes is none of this can be manual. All of this has to be done with a scalable robust IT investment. That if grocers haven't done it up to this point, are going to have great difficulty meeting profitability goals, and those that have done it will be able to meet those goals. Denman: A key part of that automation is definitely AI, and AI is being embedded in every solution throughout the tech stack. And we have a question here about what are some of the AI use cases to pursue in retail? I imagine we're talking about from a customer-facing store experience position, because AI use cases could be their own webinar. Every solution basically has some AI embedded in it. But from a customer experience, customer-facing AI, Joe, are there any things that you've seen out there that you think work? Or, potentially, is there a spot that may be an untapped area that AI can really benefit? Skorupa: Well, I don't know exactly what you mean by customer-facing. I don't know if I want to limit myself to that. But what comes to immediately to mind is automated and bi-directed pricing. I mean, that seems to be another area that is an obvious way to record ROI, to improve profitability. How does it work? Well, AI and pricing begins with setting a smart price based on historical patterns, and predictive analytic futures. That will improve your outcome. But what's even more important is, in season and in week, and mid-campaign pricing changes. And, of course, that gets right down to in many retailers daily changes online, or even hourly changes or even faster. How can you do that if your store has 20,000 SKUs, 50,000 SKUs, 100,000 SKUs, 1 million SKUs? You can't do that manually. Obviously, AI is the best way to do that efficiently and profitably. Denman: This is another one about the crisis. With stores closed and retailers in dire need of money, what will be their No. 1 priority as they come out of the coronavirus situation? That's a tough one. Skorupa: We've been asked that before. Even though it's not what RIS does necessarily on a daily basis, just thinking that I had to answer it. So let me give you a quick answer. So the first thing that a retailer has to do is to provide information to consumers, employees about their immediate day-to-day operations. OK, that's happening now and it should continue. The next thing that they have to do is to be a partner and helper in this crisis. And to do that they have to operate efficiently and effectively. And how do you do that? Well, a business knows how to do that. They analyze their cash reserves. They analyze their revenue flows. They look at their credit resources, and they tap credit in a plan that enables them to keep operating. They make plans to operate within their means, after doing this analysis. They make adjustments if necessary, and they also have to plan for long term stability. And let's make this clear: Retail is an essential industry. People are depending on us to get this right. And in fact, the world is counting on us to get this right. So let's do that cash analysis, that revenue analysis, that credit analysis, let's make those adjustments. And let's be sure we can deliver what we promise to deliver. And organizations that do these things will emerge with a burnish brand and a strong marketplace position when the crisis ends. Denman: We got a lot of questions here about RFID. One asks: For the past two years, all of the apparel and footwear shipped to the world's three largest specialty apparel retailers have been arriving with RFID tags on all of their apparel and footwear. The same can be said of Target, Nike, Adidas, Walmart apparel is now being tagged as well. This quiet revolution has not received much attention. Do you feel that clothing retailers and department stores are endangering themselves if they continue to lag behind in their adoption of RFID to enhance their inventory visibility and management? I would say yes. RFID is certainly a valuable way to keep track of inventory. There's plenty of other ways too. There's computer vision, there's inventory robots, there's a lot of other ways, but RFID in certain segments is certainly a powerful tool for inventory. Joe, do you have a comment there? Skorupa: As you recall, inventory visibility was the No. 2 priority that retailers told us they're focusing on. As I mentioned, Satya Nadella from Microsoft confirmed that in his presentation — if we needed confirmation, I think maybe our research is more of a confirmation point, than his to a certain degree. But anyway, the point is that RFID is a tremendous tool for inventory visibility, for clothing and apparel manufacturers and many other types. And why is that important now? Well, supply chains are under a tremendous amount of stress. And as we mentioned, it's not just hand sanitizer and toilet paper and things like that. Bottled water is 103%, canned foods are up 96%, vitamins and supplements are up 88%, and frozen dinners are up 71%. Retailers need to be able to track their products with RFID and others so that they can see these hotspots as quickly as possible, and adjust the supply chain to account for it. Denman: The last question: A lot of the industry is being driven by customer behavior. Can consumer behavior research play a role in designing models related to customer facing or store arrangements? If so, how are retailers leveraging it? I think the short answer to that is, yes, retailers are watching how dwell times, how customers move through the stores and using all of that information to not only inform what products to have on their shelves, but where to place them. Top shelf, middle shelf, bottom shelf, front of store, back of store, all of that information. And then also being able to tell with certain products — is it women who are going toward it more? Is it men? Is it older? Is it younger? I think the savvy retailers are collecting that data and using it to design their stores. Obviously, we have a long way to go. But I think that technology is out there, and it is being leveraged at the highest levels. Skorupa: I think that consumer behavior research will be very important coming out of the coronavirus, because I think a lot of the shopper behaviors that are occurring today and spiking, will actually become embedded in the way of life of the future. As I mentioned, that statistic, that when analysts had predicted the level of penetration for online purchasing and mobile purchasing, they predicted the level that they're seeing now to occur in 2025. Now, obviously, there's a reason that that's occurred. However, are shoppers going to go back in time, and drop back to the preceding 2020 level, then gradually ramp up again to the 2025 level in five years? I don't think so. I think what's happening is that as we know, today, only about 10% or 11% of purchasing is done in stores. The rest is done online. I think we're going to see online, jump in just a few short months or certainly within this year, to levels that they hadn't expected. The 15%, ultimately the 20%, of shopping done online that many people are predicting will occur over time. I think that will occur at an accelerated pace.

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