NRF 2025: Key Takeaways From Retail's Biggest Show

We just got back from the National Retail Federation's Big Show in New York, and we can't stop thinking about everything we saw. This wasn't your typical industry conference with vague promises about the future. Instead, we witnessed real changes happening right now in retail.

The conference opened with a conversation that set the tone for everything that followed. Walmart U.S. President John Furner sat down with NVIDIA's Azita Martin, and something Martin shared that caught everyone's attention. She quoted NVIDIA CEO Jensen Huang:

"Someone using generative AI may take your job... embrace it. It's a tool that just makes you more productive, and it's going to make you so much smarter."

What really stood out this year was how the discussion about AI has changed. People weren't debating whether to use AI anymore. Instead, they were focused on practical questions: How do we implement it? What problems can it solve? How do we measure success?

In this post, we'll share what our team learned at NRF 2025, including:

• How AI is changing retail

• Why partnerships matter more than ever

• How Microsoft's tools are helping stores modernize

How AI is Actually Changing Retail (For Real This Time)

Walking around NRF this year, one thing became crystal clear: AI in retail has moved beyond theory into reality. The proof is in the numbers - stores using AI are growing revenue 46% faster and seeing 41% higher profit margins. But this wasn't just another conference statistic - walking around the Javits Center, we saw these results firsthand. Here are the most impressive examples:

Lowe's Digital Store Revolution

Lowe's has done something remarkable. They've created digital copies of 1,700 stores that update throughout the day with real-time inventory and operations data. As Walmart's John Furner explained, it works like a video game:

"It's an idea in your head, and there's a reality you've created, you simulate, and play in it, and results happen."

Imagine changing store layouts and watching how customers respond, all without moving a single shelf in the real world. That's exactly what Lowe's is doing now.

The Future of Retail Operations

Industry expert Leslie Hand from IDC shared some exciting data about what they call the "Future-Forward, Autonomous, Resilient" (FAR) approach. Stores taking this path are seeing their AI investments pay off big time - up to 3.3 times what they put in.

Smarter Supply Chains

The advances in supply chain management were eye-opening. With Azure Machine Learning and Microsoft Fabric, stores can now predict inventory needs before they run out. Even better, these tools are helping reduce waste and make distribution more environmentally friendly.  

Microsoft's platform makes this possible by combining:

• Copilot and Copilot Studio for retail-specific AI tools

• Microsoft Fabric for data analysis

• Azure AI Foundry accessing over 1,700 AI models

AI-Powered Store Assistants

One of the most impressive demonstrations came from MediaMarktSaturn. They showed  "MyBuddy" - an AI assistant that lets store employees get instant answers through an earpiece while talking to customers. No more running to check computers or looking things up on phones.

The Future of Shopping

According to WGSN's research, shopping in 2027 will look very different. They predict 45% of major retailers will use AI to customize their product selection for each store location. This means stores will stock exactly what local customers want, making shopping faster and more satisfying.

But what makes all this truly exciting isn't the individual technologies - it's how they work together to improve the entire retail experience. Stores can start small with these tools and expand as needed, making the transition manageable and practical.

The Power of Partnerships in Retail AI Transformation

The biggest lesson from NRF 2025 was clear: retailers can't (and shouldn't) tackle AI transformation alone. The success stories we saw all had one thing in common - strong partnerships making complex technology work in the real world.

The Impact of Partnerships in Numbers

The data tells a compelling story:

• Stores working with service partners get 8.45 times more value from their Microsoft investments

• Those working with software partners see even better results: 10.93 times more value

• Partner AI projects are expected to grow 39% in 2024

Real Success Stories

CVS's Inventory Solution

CVS faced two challenges: managing their money better and meeting sustainability goals. They partnered with Y'DISTRI to create a smart system for moving products between stores. The result? They're now selling 83% of their inventory before it expires.

Woolworths New Zealand's Safety Innovation

When Woolworths saw store theft and aggressive behavior spike by 600%, they worked with Auror to find a solution. Their new system captures three times more incident data and has cut losses by 20%.

Consumer Brands Getting Smarter

• Nestle worked with Sitecore and Microsoft to build an AI tool that keeps their brand voice consistent across all marketing

• Heineken partnered with Blue Yonder to better predict demand and plan their operations

Why These Partnerships Work

Microsoft's Industry Expertise

Microsoft's retail specialists work closely with 5-8 major companies each. They're not just tech experts - they understand retail inside and out.

A Structured Approach

Microsoft uses a five-step process:

1. Listen and consult

2. Inspire and design

3. Empower and achieve

4. Realize value

5. Manage and optimize

Partners as Innovators

Today's partners do much more than install software. They:

• Make existing data more useful

• Connect different systems using Microsoft Fabric

• Create retail-specific AI solutions

• Train staff to use new tools effectively

Beyond Technology

The best partners:

• Take time to understand each store's unique needs

• Design tools for specific situations

• Focus on practical business results

• Provide ongoing support

Making It Work

What impressed me most was how partners took complicated AI projects and made them manageable. They break big challenges into smaller pieces that stores can actually handle.

The proof? We saw real stores making real improvements with these partnerships. In today's retail world, having the right partner isn't just helpful - it's essential for success.

Microsoft's Complete Retail Innovation Platform

At NRF, Microsoft presented how they've built an integrated system that makes retail innovation accessible and practical. Instead of offering scattered tools, they've created a purpose-built platform that works for everyone involved in retail technology.

Core Components

The Technology Foundation

• Copilot and Copilot Studio: Build custom retail AI tools

• Microsoft Fabric: Analyze and understand retail data effectively

• Azure AI Foundry: Access 1,700+ AI models

• Integration Capabilities: Works seamlessly with existing systems

Financial Support

Microsoft is backing this with significant investment:

• $150M in Azure AI specifically for retail transformation

• Up to $50K in project funding through Azure Innovate

• 10x increase in Copilot Accelerate program investment for FY25

Partner Support Programs

Comprehensive Resources

1. Practical workshops on AI implementation

2. Industry-specific certifications

3. Technical guidance and support

4. Architecture review services

Marketing and Sales Support

• Access to Microsoft's marketplace

• Joint selling opportunities

• Engineering assistance for complex projects

• Step-by-step guidance through implementation

Why This Matters

Microsoft has created more than just technology - they've built a complete ecosystem where partners can develop solutions, retailers can implement them, and customers benefit from better shopping experiences. The platform allows organizations to start at their own pace and expand their capabilities as needed.

This approach means partners don't have to figure everything out alone. Whether you're just starting with AI or scaling up existing solutions, Microsoft provides the tools, funding, and support needed to succeed in retail innovation.

Start Your Retail AI Journey Today

The future of retail isn't just coming—it's here. Let's help you be part of it.

Join Our Free Retail Innovation Workshop

In this 60-minute session, we'll help you:

• Identify AI opportunities for your business

• See how other stores are succeeding with AI

• Create your action plan

• Learn about Microsoft's tools and support

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