The Kroger Co. Chairman and CEO Rodney McMullen provided his outlook on the future of retail at NRF 2019 in New York City during a keynote presentation themed “Restocking the future: Kroger’s insatiable appetite to play and win the long game.” CNBC “Squawk on the Street” and “Closing Bell” anchor Sara Eisen moderated the 30-minute conversation on Sunday.
Here are McMullen’s five predictions for the future of retail. You can view the full-length keynote presentation below.
Retail won’t go away
The industry experiences disruption and transformation every few years, but it’s happening at a more rapid speed than ever before. Leaders in the industry must be willing to not only accept and react to change, but also transform their growth model.
Retail will be digital and physical
Technology and digital are already mainstays of today’s retail; however, in the future of retail, customers will not spend meaningful time thinking about physical vs. digital. Customers will always choose the shopping modality—whether physical or digital—that will deliver anything, anytime and anywhere.
Retail will offer new solutions to customers
Retailers will create solutions on customers’ terms. That is why Kroger is building an ecosystem that offers a variety of modalities, including brick and mortar, delivery, pick up and ship.
Retail will be purpose-driven
Retail will solve problems not only for customers, but also for communities and the planet. Stakeholders are increasingly deciding which businesses to support based on shared values and clarity of purpose. Because of Kroger’s Zero Hunger | Zero Waste commitments by 2025, the company decided to phase out use-once, throw-it-away plastic bags and transition to reusable bags in its stores on the same timeline.
During his presentation, McMullen announced Kroger has established a public charity in support of its Zero Hunger | Zero Waste goals. In February, the retailer will issue its inaugural open call and will award up to $1 million to for-profit and nonprofit innovators developing solutions for food waste prevention to test and scale solutions.
Retail will disrupt the ad industry
Advertisers spend $100 billion annually today, and retailers are uniquely positioned to know how customers behave and react to those marketing messages. That is why Kroger introduced Kroger Precision Marketing, powered by 84.51°. Kroger Precision Marketing provides consumer packaged goods (CPG) advertisers the ability to reach Kroger’s more than 60 million customers through its ecosystem more precisely with measurable results.