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Thoughts from the field: CES 2024

Consumer Electronics Show 2024 Takeaways

The Consumer Electronics Show in Las Vegas was a wild ride! Whether we were hosting a constant flood of meetings in our private suite, walking the floor, grabbing coffee, or just catching up with friends at the bar, there was an energy in the air that was both overwhelming and exhilarating. There is nothing like being surrounded by peers, partners and industry experts to charge you up and leave you pawing the earth to make waves in the coming year. While it’s impossible to record everything seen, heard, and learned, the team wanted to ensure the main takeaways were captured and shared back with the industry as a whole. As such, we asked each attending member of Team Nok to record their thoughts on some of the key points they took away from CES 2024.

Bobby Wann: The Future of the Reverse Supply Chain

Transparency is one of the most important factors that will influence the future of the reverse supply chain. Eliminating industry norms regarding black boxes of data between retailers and brands, or facilities and customers, has become a priority. Digitizing reverse logistics and streamlining data feeds across the reverse supply chain has become an expectation of forward-looking companies.

One of my main observations at CES is that in 2024, there are large, well-known brands that still run their returns processes on an Excel spreadsheet. These antiquated processes and shortfalls in modernizing their reverse supply chain is the largest impediment, and cost barrier, to successfully engaging with the circular economy.

It’s not that these brands aren’t aware of these shortcomings, it’s that they don’t know there’s a solution. Our team hosted several private meetings with decision makers from several leading brands and the steadiness in their hunger to revolutionize their reverse supply chain was consistent across the board.

Knowing that Nok is enabling the future of the reverse supply chain and the continued validation that came from the conversations our team had at CES further stoked our own internal hunger and momentum in powering the transition towards a more circular economy through end to end traceability & visibility across the reverse supply chain.

Renato Ricci: Own the Secondary Market

Brands can have many different goals on the secondary market, but controlling that market is a must for all. Too many brands rely on retailers to handle their returns, or offload returned products in bulk to buyers who turn around and resell those items across the secondary market. These sellers buy goods for pennies on the dollar and sell them however and whenever possible, with zero regard for brand preferences and integrity standards.

My main takeaway from conversations at CES is that many brands are still offloading their returns as an expense to their bottom line while underestimating the greater effect that this practice has on their wider business. Not to mention the revenue they’re missing out on as well. Resellers are undercutting prices, providing poor customer service, and delivering poor open box experiences which has a very negative impact on brand reputation. When a customer purchases a product from the secondary market, even if the packaging looks different, it’s still the brand’s name on the item.

Nok acts as an extension of the brands we work with. Instead of competing, Nok and brands work together to ensure the primary and secondary markets exist harmoniously to serve the brand’s larger goals. Nok has an existing, vetted, merchandising network across the secondary market to ensure brand preferences, restrictions, and objectives are upheld through resale & recovery channels.

The time to take control of the secondary market is now–and it can happen faster than you think!

Jeremy Witte: The ZVR to RTV revolution

In 2012, brands began to embrace a policy of zero vendor returns (ZVR), In essence, they offloaded their returns to retailers to mitigate costs. Today, 90% of brands are operating under a ZVR system, with just 10% using a return to vendor (RTV) policy. While ZVR did move the problem of returns off of brands’ plates, the practice also had some hidden costs and consequences:

Loss of price control across secondary markets

Loss of brand integrity control across secondary markets

Lack of accountability between retailers and brands

Return to Vendor (RTV), appropriately managed and with the right partners, mitigates all of the above issues and enables brands to regain control of their returns and ensure that their returns are being managed exactly the way they want them to be managed.

My main takeaway is that the returns landscape is starting to slowly shift back towards a predominantly RTV environment. With Nok’s circular operating system, brands can start to regain control of their returns, hold retailers accountable, and make data driven decisions across their reverse supply chain.

Areej Rabie: It’s time to focus on the reverse supply chain too

I saw thousands of brands at CES showing their very best selves, and it was a truly amazing experience. Brands and retailers know their most valuable commodity is their brand identity. Hovering over every transaction, every customer decision and every story in the media is a brand’s projection of who they are and what they stand for. To wit, most companies guard it like a Fort Knox filled with Fort Knoxes–and that’s wise.

However, as companies look to increase sustainability and preserve brand integrity, all too often they focus on the primary supply chain and primary market channels, while disregarding the reverse supply chain and secondary market channels. One of the largest contributors to a brand’s environmental impact, is the rising trend of returns and what they do with them. In that same vein, one of the largest markets for consumer buyers is the secondary market.

As innovative brands begin to put as much attention into the reverse supply chain as they do in their primary supply chain, they will begin to see a significant ROI in the form of incremental revenue, market expansion, audience engagement, and environmental impact. Sustainability and brand integrity standards deserve to radiate across the reverse supply chain and secondary markets too.

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