The state of retail heading into 2024

Years ago, NRF’s annual convention was nicknamed “Retail’s Big Show,” and the name just stuck. With nearly 40,000 attendees, 6,200 brands represented from over 100 countries and more than 1,000 exhibitors, the show certainly is big, but the event is also an unofficial kickoff to the new year following the holiday season. It’s where leaders in the industry gather to explore new technology, develop new ideas and learn from each other as they chart the path forward.

NRF President and CEO Matthew Shay joined the Retail Gets Real podcast live from Retail’s Big Show to talk about the event, how retailers fared this holiday season and what the year ahead looks like for retail.

Shay says retailers are coming off a successful holiday season, with sales growth expected to be around 3%-4%, reflecting a more sustainable rate of growth than seen during the pandemic years. The growth is a reflection of retailers rising to meet consumers’ growing expectations for value as well as seamless experiences across digital and physical stores. It also demonstrates the underlying strength of the economy.

“For all the talk of consumer sentiment, I think the things that really drive consumer spending are the unemployment rate and wage growth,” he says. “And right now, the unemployment rate is very low. Wage growth remains steady, although it’s moderated a bit, but it’s still running in excess of inflation, and consumers vote based on whether or not they have jobs, whether or not they’re making money.”

The future ahead will also depend on how good of a balancing act the Federal Reserve can do with interest rates, Shay says, as well other external factors such as global geopolitical conflict and challenging elections in the United States. In conversations with retail CEOs at the event, he says, many noted how high customer expectations have risen.

Looking ahead, consumers will continue seeking value, as well as being deliberate in their spending. “I think in the coming year, there’s a recognition that there will be a premium on execution, and those that execute at a high level will be successful. Those that don’t, maybe won’t be able to keep up with the dynamism in the industry,” Shay says.

Listen to the full episode to learn more about what to expect from consumers in the coming year and what issues NRF will be advocating for in Washington.

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NRF’s podcast features unfiltered, insightful conversations with the industry’s most interesting people. Hear retail executives, industry experts, entrepreneurs and influencers discuss trends, their career stories and the future of retail.

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