Early last week, the OceanX team again made what is now our annual pilgrimage to Las Vegas for Shoptalk 2018. The stated theme for what is considered the premier event for all retail was “The New Normal,” which keyed on the idea that rapid change is now commonplace in the retail and e-commerce world.
The event, in only its third year, has grown so rapidly that it felt like it already lost a bit of the magic and intimacy of last year. More than 8,000 people attended this year — and it is hard to keep growing while maintaining quality. Even with the talented, hardworking, and intelligent crew who run Shoptalk, our concern from last year — that the show might become a victim of its own success — seemed warranted.
Subscriptions were, again, a hot topic. We connected with, saw speak, or just saw at the event people from almost every mid-sized and large retailer and brand currently in the subscription world. We might have missed a few, but we saw teams from Stitch Fix, Gwynnie Bee, Sephora, Gap, Ann Taylor, Rent the Runway, Daily Harvest, Birchbox, Kidbox, Filter Easy, Madison Reed, Winc, TechStyle, Rockets of Awesome, Ipsy, The Honest Company, and Ollie — a team that was particularly popular on the show floor and made my dog very happy when I walked in the door with treats.
After three days of keynotes, panels, tech talks, speed dates, and networking, there are plenty of overall themes and takeaways for retail in general. Since we focus on the exciting world of subscriptions, here are our:
Top four subscription economy lessons learned from Shoptalk 2018
#1 For large brands and retailers, it’s all about membership, relationships and personalization.
The two best keynotes we saw were from Ulta Beauty and Nike. Mary Dillon, CEO of Ulta Beauty, highlighted how almost everything her company does in stores and online is about creating the feeling that both customers and employees belong to something special. As an example, ULTA’s Ultimate Rewards, now at 27.8 million members, drives 90 percent of sales but also connects people to the brand in a deeper and more authentic way.
Nike’s Chief Digital Officer, Adam Sussman, did not waste any words talking about new Nike shoes. Instead, in typical Nike style, he spent his time talking about how the brand tries to create unique and exclusive experiences for its members. He even broke down a few key target demographics and then showed amazing examples of digital, store, and experiential campaigns that targeted these subsets of the Nike audience. NikePlus now has more than 100 million members and expects to triple by 2023. The key business metric is that those members spend four times more than regular shoppers across Nike platforms.
The overall message was clear: The future is not product and transactions but relationships and memberships and this sense of belonging leads to increased sales.
#2 The buzzword bonanza extends to subscriptions
From keynotes, panels, and tech talks to the exhibit hall and bars, we heard no shortage of buzzwords. And because we always end up talking with people about subscriptions, we realized that those buzzwords are influencing subscription-based businesses at the same pace they are hitting the rest of the retail world. “Voice,” “conversational commerce,” “AI,” “machine learning,” “chatbots,” “big data,” “personalization,” “blockchain,” “robots,” and more — we heard them all over and over again. The cool part? We got to hear how each company’s team was thinking about implementing these ideas and new technologies in ways to better serve customers or make business more efficient.
#3 CPGs have entered the party via Grocerytalk
While not 100 percent related to subscriptions, it was great to see and talk with teams from so many of the large CPG brands that are focusing on direct-to-consumer opportunities as they fight for shelf space and against private-label brands from Amazon, Target and Walmart as well as new digital first upstarts like Brandless. We think many of these larger CPGS brands will skip trying to compete with Amazon by creating a standard e-commerce store chalk full of products and will move toward creating relationships through subscriptions.
#4 Platforms that support subscriptions and recurring revenue are growing
This final lesson might seem a bit self-serving, as OceanX is one of these platforms, but it was exciting to see some of the larger e-commerce technology players such as Shopify and Magento talk about subscriptions. The biggest announcement in this space was the launch of a platform aimed at the apparel rental subscription market called CssStle, from the founders of Gwynnie Bee. It announced that other retailers can now use its platform to handle their own rental apparel business.
Overall Shoptalk Thoughts: Don’t become a victim of your own success
This year, the OceanX team decided to up our game a little bit, and although we did not exhibit, we did participate in the hosted “speed dating,” did a six-minute tech talk on the floor, and co-hosted a fun Subscription Social Happy Hour on Monday night with our good friends from Hawke Media. We will definitely do something similar next year, perhaps with an increase in both activations.
If I could make a few suggestions to the Shoptalk team, they would be:
Don’t try to grow too much larger: I realize you might have a specific end game in mind and that growth could be the way to get there, but for events of this size, go for quality over quantity.
Mix up the content a bit more: Some of the tracks seemed like pitches from retailers to investors, and everyone on the panels seemed to agree with each other. I would love to see two retailers take opposing sides in an argument (to sell on Amazon or not, to spend on Google versus Facebook versus Amazon, etc.) and debate about it.
Go back to high-quality production in the track and panel rooms: The energy was way down because we attendees just felt like we were in a typical Vegas convention room.
There were times walking down the hall between sessions that made us feel like we were on a New York City street — great energy, but perhaps a bit too much. We hope the Shoptalk team continues to grow and improve the event. Even though it might have lost a bit of what made it special last year, it is still exponentially better than any other event in the space in all key areas: organization, speakers, networking, production, keynotes, and — most importantly — the people.
While the event might have grown quite a bit in a short time, we still feel like our time at Shoptalk 2018 was valuable. We’re always ready to talk subscriptions with big industry players, and we’re excited to grow our presence at the event next year.