Anne 0:08
Hello, you are listening to the OMNI talk Fast Five, brought to you in partnership with Microsoft, the a&m consumer and retail group, takeoff and sezzle. The OMNI talk fast by podcast is a podcast that we hope makes you feel a little smarter. But most importantly, a little happier each week too. Today is May 26. We’re kicking off summer. I’m your host, Anne Mezzenga.
Chris 0:32
And I’m Chris Walton.
Anne 0:32
And we are here once again to discuss all the top headlines making waves in the world of omni channel retailing. Chris, you’re hot off a flight.
Chris 0:41
I am Anne. I got in at 1am this morning. Like 9am right now. So that means I got about four hours of sleep but yeah, I was out in my in Miami.
Anne 0:49
Yeah
Chris 0:49
In Hollywood, actually, technically,
Anne 0:51
Hollywood, Florida,
Chris 0:52
Hollywood, Florida.
Anne 0:53
What’s Hollywood, Florida like these days?
Chris 0:55
I don’t know. I didn’t get to see much of it. I didn’t really get outside of the hotel because I was at the Manhattan momentum conference all three days.
Anne 1:02
Yeah.
Chris 1:02
Banging conference. It was a it was a pretty good conference. It was about 1000 people there. And the thing I loved about it, everyone wanted to be there.
Anne 1:09
Oh, that’s good.
Chris 1:09
Yeah.
Anne 1:10
As opposed to not wanting to be there.
Chris 1:11
Yeah, no, I mean, there’s, you know, there’s some conference you go to, like, you know, the attendees are like, you know, they’re like a boondoggle. That’s why they’re there. But these were people that were generally interested in the future of, you know, what Manhattan specialises in, which is order management, transportation management, warehouse management software, which I got to tell you, Anne, I got to geek out for a second I there were some big unlocks for me at this conference.
Anne 1:11
Yeah, you were posting a lot from there.
Chris 1:15
Yeah. And so those posts have been doing really well, like really, really well. I’ve been, you know, pleasantly surprised. Not necessarily surprised, but very thankful to everyone for noticing that. Because, you know, the big shock for me not to walk out but I’m going to is there is a big disconnect in how retailers allocation systems work with their order management systems, both companies I’ve worked at in the past, the allocation systems were all based on the sales forecast that you put for those items at the store level, that’s what determines the inventory that goes to a store.
But in reality, that doesn’t work anymore, because now you have to factor in the ship from store volume from that store, or the curbside pickup volume from that store, all which is being facilitated by ecommerce. If you’re not thinking about that the right way, then your order management systems, and where you’re allocating product needs to change they need to coordinate better.
Anne 2:20
Right
Chris 2:20
So that’s an unlock that Manhattan talked about for the first time, which I’m dropping down the beginning, because I think it’s quite big and
Anne 2:27
yeah
Chris 2:27
Quite significant.
Anne 2:28
Well, especially with what we talked about last week with you know, target Walmart and the inventory issues that they’re having all this over, you know, they, they were so backed up from supply chain issues, but prior and now they’re sitting on all this inventory. So really being smart about how you’re going to think about planning for that planning for not just the you know, 50 mile radius around your store, but for the entire nation.
Chris 2:52
Yeah, 100% Because you’re not just allocating your price to what you’re gonna sell in that store. You need to allocate it based on how you’re going to defray the cost of shipping all these locations or pickup or whatever but but and I’m getting pretty pumped here because we got we’re t minus one week on
Anne 3:07
Oh my God.
Chris 3:07
On the Christian and European tour.
Anne 3:09
We’re gonna we’re gonna be bringing so much content live from London from the shop talk Europe conference, and after that, we’re gonna be there for 15 days.
Chris 3:21
15 days.
Anne 3:21
Yeah
Chris 3:22
Yeah, no, I don’t I don’t even know I lost track. But yeah, and we’re gonna be on stage.
Anne 3:25
Yeah
Chris 3:25
Each moderating two panels.
Anne 3:27
Yep, we got a lot going on. We’re gonna be I’m gonna be talking about supply chain and merchandising a lot of what you were just talking about, and omni channel retail experiences. I’m
Chris 3:36
I that, really is your two panels. Yeah, sweet minor last mile, like solving the last mile and then sorting fact from fiction for lack of a better week between startup technology and the real world, which, which will be fun. Yeah, I got to put a presentation together for that, too. But uh, yeah, I’m excited. So we leave on Friday, right next Friday.
Anne 3:53
Yeah It’s right.
Chris 3:53
Yep. Stay close to us on social media, folks, because we are going to be hot and heavy.
Anne 3:58
Yeah.
Chris 3:59
Look, everyone there’s Big Ben.
Anne 4:00
Oh, my God,
Chris 4:01
European vacation referencing
Anne 4:02
Oh my God.
Chris 4:02
All right. Anne we had so many reviews this week. Honestly, it was hard to pick just one. But we’re gonna go in order of how they’re submitted each and every week to be as you know, egalitarian as we can be in terms of our review reading.
Anne 4:15
Okay,
Chris 4:15
But I gotta tell you, for whoever left it is, I have no idea who you are. Astronomy newbie If you’re listening. I can’t wait.
Anne 4:22
I thought that was an inside joke. After I read this. It’s like Chris is gonna have to explain to us like why astronomy newbie is like the name of this person.
Chris 4:30
We’ve got to wait a few weeks to read it, but it cracked me up. And if you want to go on on Apple podcasts and read the review, go ahead because it’s hilarious. But yeah, we’ll be bringing that to you in a few weeks. But today,
Anne 4:40
Yes,
Chris 4:40
We’re gonna give our shout out to quote another P name dotCVW.
Anne 4:45
Okay,
Chris 4:45
Who from that handle clearly is an avid listener of the show from our reference to every name on Apple podcast being a P name or a B name. But here’s what he or she had to say this week. “My preference is to watch Chris in an on video. Oh, to watch and see their joyful interactions and witty rep R Tae good use of rep ar 10. It is infectious. I love the direct thoughts and retail expertise. Chris is rants on Instacart are my favourite. And then my recent favourite to it is fun to watch and challenge your thinking a MUST LISTEN.” Anne how’s that one make you feel?
Anne 5:19
I mean, it’s great. I love this. I’m so excited that people are doing reviews. And I want to tell people listening like, if you don’t have to be a retail expert, like friends, family, people, anyone if you are listening, I feel like I’m like I’m trying to get money like from from like the National Public Radio like fundraising,
Chris 5:37
Like Jerry Lewis,
Anne 5:38
You can make a difference. But you do make a difference. Even if you don’t think it’s a big deal. It is a big deal to us. If you don’t want us to read it out loud. We don’t have to read it out loud, make up a p or b name and put it on there. And we don’t care. But we just want you to know how much we really appreciate you. If you’re listening on Apple podcasts leaving a review hearting the podcast and following if you’re on Spotify, Google Amazon music etc. Please follow and subscribe. We hate to harp on it, but it does make all of all of the content that we’re bringing forward for you possible. And we may just read it aloud. You’re gonna want to hear what astronomy newbie has to say in the coming weeks too. I can guarantee that.
Chris 6:15
Absolutely. All right Anne. I love I love coming to you about our it’s like what did she say about us on video and just how we get along. That was so good. And for those
Anne 6:23
Didn’t watch the pre show
Chris 6:24
Didn’t watch the pre show today. So we got a little bit of a spat, but
Anne 6:29
We’re ready for 15 days uninterrupted
Chris 6:31
I think we are getting better though, as we roll along here, I think the spat is already dissipating. So all right, Anne, in this week’s Fast Five, we’ve got news on Walmart officially releasing the Kraken as you like to call it on its announcement surrounding drones, live commerce platform firework nabbing $150 million in funding. Wayfarer opening an all modern physical storefront and Nordstrom sunsetting trunk club but first, we take off with some exciting store opening news out of Amazon Anne this is huge.
Anne 7:03
Yeah, we have been talking about this for I feel like all year and even before that. But Chris the moment we’ve all been waiting for has arrived, Amazon has finally opened the doors to their la Amazon style store. So according to Wall Street Journal Amazon style opened the doors in Glendale, California, this week in details are still somewhat limited. I did put out a Post this week of somebody’s tour from the actual
Chris 7:29
Key wire
Anne 7:29
Key wire right
Chris 7:30
Or something like that.
Anne 7:31
But the store is featuring brands, not just Amazon essentials line, but also Lacoste, Levi’s, Steve Madden, and others. And as promised, as we all suspected, shoppers can go in, they scan codes on the display items. And then an employee grabs the items from the back in the right size and colour and puts them into a fitting room and checkout counter. And that starts as soon as you scan that item so they start filling the fitting room right away.
Chris 7:58
Interesting.
Anne 7:59
It also appears that if customers don’t have their mobile phones, or they don’t want to do the scanning experience that a sales associate can be with you side by side, and will send those items still that you want to try on to the fitting room. Or you can do that from your mobile home phone at home. Your move from mobile home
Chris 8:18
From your mobile phone in your mobile home.
Anne 8:20
Yeah. Chris, what are your thoughts on this?
Chris 8:23
Ah, you know, I, I think you know, I’m one I’m excited to see it.
Anne 8:26
Yeah,
Chris 8:27
Like, it’s cool that it happened. They talked about it. It wasn’t like fake press, you know, they actually went out and did it. Which if you actually stop and think about what this is, I didn’t think about this initially. But that deserves a hell of a lot of kudos. Because this thing works really differently than anything we’ve ever seen.
Anne 8:42
Exactly.
Chris 8:43
But you know, in some ways, it’s like, it sounds exactly as it was expected as it was laid out. So I don’t know about you. I’m sure this is true. But I’m dying to get out there and see it firsthand.
Anne 8:52
Yeah, exactly. I mean, I think that, especially once you start to see it hit more, I guess mass visit from customers like right now. It’s still like what the journalists are seeing. And I think like once you start to see more load put on the store what that what those turn times look like what how long it’s going to take to you know, if you request something via the screen in the fitting room, how long does it take to actually get that item back to you?
Chris 9:20
That’s a great point Anne. Like I’m actually kind of glad that we’re going to Europe here for a couple weeks because like actually kind of want that. That’s a great I didn’t think about that. It’s a great I want to see that stuff figured out but you know, I think net net, as I have been thinking about this more since they first announced it in the last couple months until it came to fruition. I’m still really curious if people want to shop this way. I’m not entirely sure that they will. You’re more I’m curious what you think of in the SU but and it’s interesting that you said they’re picking it as soon as they scan it. I think that’s an important point you
Anne 9:48
Right
Chris 9:48
Because I still feel like this process adds more time into the overall apparel buying process than just buying in walking out with floor stock or having to wait for your size to be Pick to the back room versus you just take it to the backroom and trying it on.
Anne 10:03
Yep.
Chris 10:03
On Demand.
Anne 10:04
Yep.
Chris 10:05
But at the end of the day, I still think it’s worth trying. Because if customers do like it, then you have an entirely different income statement that emerges from this model. But I don’t know. net net, I’m, I’m still I hate to see it. But I’m having my doubts on whether this store will work as this concept of but maybe there’s something more to it.
Anne 10:22
Yeah, I mean, I think that you’re right, there’s, there’s definitely still experiments being run in this store. And the way that this is showing up on May 25, when it opens and the way that it will be, or how it will evolve in the next several years will be something different, I think. I mean, when was the last time you tried to try something on at any other retail store, it’s not as simple anymore is like just walking into the fitting rooms, it’s finding an associate unlocking the fitting room, like there’s still some friction there.
So I feel like you know, now that I’ll be able to scan my my phone and being able to open the fitting room, and it’s all prepared for me. I mean, it’s a different kind of shopping experience. And so the customers are going to have to adapt to it, whether or not they like it, we’ll have to wait and see. But I do think that it makes a lot of sense. The other things that I like about this outside of like the logistics part of it. It’s not all Amazon product, I was surprised to see that. I mean, you have higher end lines, like vix and theory also being Yeah, in there. It’s 30,000 Square,
Chris 10:22
It’s huge.
Anne 10:23
You know, another feature, you can ship product to a fitting room there. So like say I’m at home and I want to order a box of things, I can ship it to a fitting room, make an appointment, go try it on. And then I just leave this stuff there. I don’t even have to like package it up or do anything. It’s like instantly credited to my account. So I think this will be you know, there’s there’s things at its core that will make for a better Amazon shopping experience overall. And so to get to your point earlier, like it’s still a test, though, and what this actually ends up being maybe something completely different. Yeah,
Chris 11:52
I think fundamentally, I like what I like about it is the connection of the fitting room to the product and to the sales associates without having to actually like, talk to them.
Anne 11:52
Right.
Chris 11:52
I think there’s a there there and other companies like Rebecca Minkoff have tried to exploit that, but no one else at maths has really tried to go that direction. But yeah, we’ll see. I will, I can’t wait to go see it.
Anne 12:12
And I think the other thing that’s not being talked about here is the amount of data that you’re getting just from me scanning that item and putting it in the fitting room like you’re building this Amazon’s algorithm of product information and personal information about me so that even if I’m not in the store, they they know what I like and don’t like, and they can keep serving up product whether I’m in the store or at home,
Right there’s a lot of things that could be with this.
Right.
Chris 12:35
I think that’s the best way to summarise it. Alright, let’s go to headline number two. headline number two is pretty salacious this week. In one of the many stories from this week’s standard PR news Blitz, following a poor earnings report from Walmart. Walmart announced that they will be offering drone delivery to as many as 4 million homes
Anne 12:55
there’s some 4 million households.
Chris 12:56
Yeah, There probably are Yeah, right.
Anne 12:57
I’m talking about North North Arkansas of
Chris 12:59
the video shoot up this drone looks like a $4 million home actually. According to CNBC, Walmart is expanding drone deliveries across six states with operator drone up. All told the company plans to have 37 drone delivery sites up and running by the end of the year. Now, folks, here’s how this works.
Anne 13:16
Break it down.
Chris 13:16
All right, let’s give it give it to the audience. Customers who live within the range of a Walmart drone delivery site within Arizona Arkansas, Florida, Texas, Utah or Virginia can order any of 1000s of items between 8am and 8pm. Each drone delivery Anne, comes with a $3.99 cent fee, and customers can only order items totaling up to 10 pounds. orders must also be placed currently on drone UPS website, which is not through Walmart, which is key although Walmart has said they plan to add this to their UX in the in the coming future. Of course, each order is then picked and loaded at the drone site near the store and then flown via remote control, pass certified pilot to the customer’s yard or driveway. And then a cable on the drone slowly lowers the package for delivery. If you’re at all confused, you got to watch the video but this is literally how it works. The video is super cool, by the way, Anne you have the a&m put you on the spot question this?
Anne 14:16
Yes.
Chris 14:17
All right Anne, here’s what they had to say. While we at a&m Admire Walmart’s innovation and testing across a wide range of technologies. We think the 4 million households feels quite aggressive care to comment on this one.
Anne 14:31
The 4 million households feel aggressive. I agree. Yes, they do. Just because there are 4 million homes within a 50 mile radius of each one of these locations does not mean that you are delivering to 4 million people. A very nice job, however, by the Walmart PR team of stating the possibilities with this drone delivery.
Chris 14:52
standard operating procedure for them at this point.
Anne 14:53
Yes, absolutely. Chris. I cannot get on board with this. I would like to I really would Be excited to do this. But I’m still going to be a doubter on this technology. I just, I’m still, if I’m Walmart, I’m looking at autonomous vehicles before I’m even considering this. There are so many things that could go wrong with this that I would not be putting I know they’re trying to compete against Amazon and get there before Amazon does. But there’s a reason that Amazon has not done this yet. With all of their resources. First of all drones, there’s still one to one delivery. I have a problem with that.
Chris 15:28
Right
Anne 15:28
That’s not you’re you’re, you’re requiring a pilot. I mean, like Chris said, watch the video, because this still requires a tonne of human effort to deliver Hamburger Helper, which is the number one delivered things in the trial that they’ve been doing, you know, much Hamburger Helper costs?
Chris 15:43
How much
Anne 15:43
$1.50 Chris, you’re hiring a pilot,
Chris 15:48
A certified drone pilot
Anne 15:49
To deliver up to five boxes, or a 10 pound limit of hamburger helper, not a valuable use of this technology. And I mean, I looked at like some of the other top items that are purchased from Walmart, like your, you are so limited in what you’re going to be able to deliver that it just I cannot fathom how this makes any sense at all.
Chris 15:49
Wow, Anne bringing the heat.
Anne 15:50
Finally, finally, things are falling from the sky. Okay, you look at these videos, there’s a rope. There’s parachutes. There’s all these things like,
Chris 16:19
Right
Anne 16:22
What about the elements like what happens when it’s a windy day like Mary Poppins, and the Hamburger Helper just like float over to the neighbor’s house? Like they
Chris 16:29
I hadn’t thought about the weather.
Anne 16:31
Like, they still make an impact on this. It’s like, it’s like, come on Walmart, like focus your energy on like the, you know, we talked about the ice cream truck from Robo mart. Like, let’s think about ways that you can do this with lower involvement from people lower cost of operation. I just, I’m worried about you know, like Jenny from the Little Jenny from the block getting a Walmart box of 10 pounds of toilet paper dropped
Chris 16:58
Dropped on her head.
Anne 16:59
Yeah
Chris 16:59
Yeah, right. I mean, yeah, I mean, well, the pilot, I guess has to avoid that. Right.
Anne 17:04
I guess
Chris 17:04
That was your best rant of all time. I don’t think you’ve ever reached that level.
Anne 17:08
I’m well, I just don’t get it. I I’m I do agree with a&m. Walmart. It’s cool. You’re trying things but my goodness, how is this gonna have happen? How? I mean, what do you think? Am I not? I know you are shocked as well.
Chris 17:23
No, I’m shocked by the rant. And I’m so I’m super impressed. Actually, no. And I 100% agree with you. 100% 110% there.
Anne 17:33
You added some great stuff. You had a great point on LinkedIn that I you have to talk about.
Chris 17:37
Oh, my God. But I mean, yeah, I have so many questions about this. I’m with you. I simply don’t get why you’re talking about this, or why you’re investing in this. It’s such PR fluff. Number one.
Anne 17:47
Yes,
Chris 17:47
fluff is the right word, or puff. Anyway, puff fluff, whatever you want to call it. And then number two, the more important question to me is, why do people want this?
Anne 17:57
I don’t know.
Chris 17:57
Like,
Anne 17:58
It’s a great question.
Chris 17:58
And I’ll get to that more. But like, so for example, I saw what I have now. I’m now dubbing him, the head of the head, Walmart, social media cheerleader and, and chief puff master Tom Ward, on social media. He was pumping this on Tuesday. So I asked him point blank. And here’s what I said. I said, quote, time, how many tests deliveries to individual customers have actually been done at this point. And if it’s a lot. Kudos for keeping them and use your shot videos of them under the radar screen up until this point, before you roll out to $4 million homes and 4 million million homes. Why do I keep
Anne 18:33
doing that? Because it’s a four, it’s a $4 million home that
Chris 18:37
4 million homes, Because that is what is missing for me here. And how does Walmart actually ready this for rollout to 4 million homes, when not one video of it has been shot by a customer or an onlooker. Like if you just stop and think about that, that in and of itself is insane.
Anne 18:53
Yeah.
Chris 18:53
And not surprisingly, Tom did not comment on it. Which also is frustrating, because if you’re going to put it on social media, you should be willing to comment on it. That’s what social media is for. It’s for an authentic conversation about why you’re doing things. So Walmart, just stick to the press releases, get your executive team off social media, because it’s not adding anything. In fact, it makes it quite honestly worse. But then the bigger question for me is
Anne 19:16
Yes.
Chris 19:16
Why are you investing in this? Why does the customer want it firstly Anne. And I’m going on a huge rant.
Anne 19:21
Yes.
Chris 19:21
So get ready.
Anne 19:22
Yes.
Chris 19:22
First, it’s limited in scope.
Anne 19:24
Yes.
Chris 19:24
You can’t get drones to an apartment building. The way this is designed. So there’s only so many people you can reach second, is it really a better experience than a standard delivery? It seems like
Anne 19:34
I don’t think so.
Chris 19:34
It seems like it could it’s not it seems like a confusing option to serve up on the PDP if you’re given the choice right? Like you don’t even find this
Anne 19:42
no you do get to run to the package when when a parachutes down.
Chris 19:45
You just want it same day you don’t give a **** how you don’t give a **** how it gets you’re like, Oh, I’m going to choose draw. Oh, I want the drone versus the car that’s gonna get it to me and in fifty minutes, like why? How does that even work? Number One Number 2. Third, sure could save If money in the long run relative to maybe
Anne 20:02
I think that’s debatable.
Chris 20:03
No, I was gonna say, Yeah, you could maybe get me on the argument that you can save money versus Evie delivery or autonomous delivery. But your point about having to having to have a pilot fly, each one of these things is really important. Like, how does that make for better economics?
Anne 20:17
I don’t know.
Chris 20:18
I don’t get it. And then fourth. And my final point in this much much ballyhooed rant is, and this is really important. You can only get so much speed out of this as well.
Anne 20:18
Yeah,
Chris 20:18
Right? If you’re having to pick and pack and load individual items onto a drone, versus consolidating your deliveries at a micro warehouse.
Anne 20:36
Yeah,
Chris 20:36
As the instant delivery guys are trying to do, you can’t get that much speed. So even from a speed perspective, this is a horrible fricking idea. Alright, so ran over I hate this. And like I said, I hate the execs that are out there touting it, too. Like it’s the greatest thing since sliced bread, when it’s quite debatable how much has actually been even done from a due diligence perspective on this. In my opinion,
Anne 20:58
I think we’ve answered aAM’s question. And anyone else out there who’s wondering what the Army top retail team thinks about Walmart drones,
Chris 21:06
I think we need a cigarette. I think we really do
Anne 21:08
Or an entire carton.
Chris 21:09
Alright, Let’s keep rolling
Anne 21:10
All right. headline number three live commerce company and headliner of today’s LinkedIn live event. Firework announced $150 million in funding led by Softbank, according to the Wall Street Journal firework whose technology helps companies make livestream shopping events and other videos that it has raised $150 million in a series B round of funding that values the startup at a whopping $750 million. As listeners of OMNI talk you already know. But fireworks technology enables shoppable streams and other video that will run on company’s websites. It says it has 900 clients including grocery chains, Albertsons, and the fresh market. As we mentioned, we are doing a LinkedIn live event with their CEO Vincent Yang today to talk about what is going on in the state of commerce. So check that out. If you aren’t able to attend the session live. Check it out afterwards.
Chris 22:06
It’ll be on army talk right afterwards
Anne 22:07
Yeah, exactly.
Chris 22:08
You know, in our newsletter tomorrow as well.
Anne 22:10
Chris, we’ve been following this for a while but what are your thoughts on this latest fundraising round?
Chris 22:15
Yeah, I mean, my thoughts are kudos to firework it shows just how big of a trend this is. I mean, they’re they’re kind of going against the market here raising this money at a time where others are finding that not so easy. So it shows you that these guys are onto something. And these guys these guys are sharp man Vincent every time I sit down with him for an interview he just blows my mind the guy is so articulate number one, but and and I encourage you guys to check it out, too. He showed a demo of what they’re doing it fresh market where we’re to give you guys an idea. And livestream is overused. They have they have shoppable Video,
Anne 22:49
Video shot live.
Chris 22:50
Yeah, yeah, video that was shot live playing on the homescreen of fresh market when you get on their page. And for me watching him talk about it was really important, because I thought it was a huge unlock for me around this idea of localization, which retailers are always talking about, but they’re really giving lip service to it at the end of the day, but it’s an every earnings report, we need to get better and be more local.
But now through this capability, the way that I’m contemplating it is retailers can literally personalise their home pages, to their customers predefined local stores, right? Which, you know, in the day of curbside pickup, everyone already knows who your local store is. Right? Right. So you just put videos of your local staff at the stores, talking about products, making food, doing whatever the hell else it is that they want. It’s going to open up a whole nother level of intimacy between customers and stores. Absolutely. That’s the way to unlock localization a community feel across your retail operation. And that’s why these guys are getting the money that they are because that in and of itself, is big time. In my opinion.
Anne 23:54
I completely agree. I mean, I think that the important thing that I think brands and retailers listening need to realise about this is that content is now another component of the omni channel strategy you have online, you have offline and content is going to be the new channel that you need to focus on where your customers are coming from. And firework is making it really easy, as you mentioned, for the fresh market from Albertsons and others, like they’re making it really easy for brands to just be like, help us we need a strategy, we need to just figure out how to start trialling this and doing it. And that I think is why they’re getting the attention of SoftBank and other large retailers but, but kudos to those guys. I’m excited to see what happens in the next couple of months.
Chris 24:36
Yeah without a doubt, and it’s a great interview. Check it out. Alright, headline number four Anne, on Tuesday this week, Wayfair opened a new store in Massachusetts featuring their all modern brand according to home textiles today. The goal for the new store is to blend the best of the digital and physical shopping experience allowing shoppers to see and touch products in person while offering digital access to product options design ideas and delivery options, something that sounds like anything any retailer could say, this new store located at 310. Market Street is about 10,000 square feet and will be followed by another all modern store in Dedham, Massachusetts later this year. And my question for you as a recent Wayfair purchaser, yeah. How excited on a scale of one to 10 Would you be to shop this all modern store from Wayfair?
Anne 25:24
You know, I think for me, I need to get a better understanding of what the best of digital and physical shopping experiences is, is like in real life in the store before I make that call? My expectations are low.
Chris 25:38
Are they low, they are low right.
Anne 25:40
well, just because
Chris 25:41
you’ve been from a shopping spree
Anne 25:42
Yeah, I the the problem that I have with this, though, Chris, is that Wayfair has an opportunity to do really, really well here. I mean, they’re coming in, they can beat everybody else on price. And when you take this all modern brand that does look like a West Elm, like a room and board. But exactly looks like you could you could grab a bunch of people and especially if you can really add like a convenience element to this where you know, you’re you’re using scan and go, you’re doing something else that you can’t do in those legacy furniture retailers. I think that they have a huge opportunity to capture this, you know, this Gen Z audience furnishing their first homes who like and adore this style. I don’t know that it’ll happen though.
Chris 26:27
Yeah, I love that you brought up the part about how they position this with a modern styling. And I want to, I want to I want to hear more about what you’ve what you’ve got to send that to, but like, I’m gonna queue up my second rant Anne
Anne 26:37
Oh, my gosh, two in one.
Chris 26:38
This one could be bigger. This one. So look out Steve Dennis, because this one could be bigger. But I think it’s a good idea.
Anne 26:45
Yeah.
Chris 26:45
But I’m worried this is terrible execution right out of the get go.
Anne 26:49
Okay,
Chris 26:49
like you said it Wayfair needs stores.
Anne 26:51
Yes,
Chris 26:52
but this is not the way to do it. And I ranted on this the first time around when they when they first announced it. But now I think there’s even more nuance to it. And I heard from some Wayfarer employees on social media that messaged me directly on LinkedIn, that my commentary was actually on the mark. So that gives me some, some validity to what I’ve got what I’m about to say here, but to me, the all modern designation here means absolutely nothing to me.
Anne 27:16
Okay.
Chris 27:17
And the other problem with it is having having a home furnishings background is modern furniture is generally a high end experience. You’re a specific type of customer if you’re looking to put modern furniture into your home,
Anne 27:29
okay
Chris 27:30
And so if anything, I worry this could end up hurting wayfarers brand perception in the long run. Because people will get into that store, see what it act what this product is actually under this brand and be like, Wow, this doesn’t look like the glasto pictures online that I thought it was and therefore it could start to question the quality. And so you’re right, you’re gonna have to have the best of the best omni channel experience which you’re alluding to, which as you said, for all the reasons you’re right, I think you should be sceptical of Walmart and that’s the thing. That’s what pisses me off about wafer. wafer isn’t chic. It’s not chic at all. It’s mass,
Anne 28:05
okay,
Chris 28:05
It’s mass. It’s about and it’s about them. I think it’s about damn time. They understand that and express themselves in the physical world that capitalises on who they are as a brand. I just feel like this brand is lost their mass. I mean, they have Kelly Clarkson doing their commercials.
Anne 28:19
Yeah,
Chris 28:20
That’s, that’s, that’s, that’s appealing to a mass market. And I will take this to my grave final point. Anne I will say here, CEO, Neeraja nurture, I’ve met him a number of times. He is the most left brain person I’ve ever met running a retail company. He’s great at ecommerce, a genius in E commerce, I will give him that. But he doesn’t get the intuitive side of physical retailing. He doesn’t. And that’s the problem here. And this is a great example of that, because it just isn’t going to meet the needs of the consumer in the long run.
Anne 28:51
I don’t know that I completely agree with you.
Chris 28:53
Okay,
Anne 28:54
I think that it does meet the needs of some consumers. And even though the quality isn’t quite there, they’re they’re going in on price point. And for some people, they don’t care. I mean, I’ve sold enough resold Wayfair furniture to know that some people just want it to look cool, they don’t care that it’s not the quality mean, you have the same argument I would say for IKEA, like it’s not going to be as comfortable but it looks a certain way it meets a certain aesthetic at a certain price point that you need it to. So I would say yes, you do have the traditional people who are used to shopping in a Restoration Hardware room and board or you know, West Elm but there are times where it’s okay to have this it’s the execution though is going to be make or break so we got to see what happens in that space. I just
Chris 29:39
I wouldn’t have led with a modern brand. I just wouldn’t have I just don’t I just you know from my years of selling this stuff at target at Mass
Anne 29:47
In closing What would you have done then? If you’re doing a Wayfair physical store like what
Chris 29:52
You’re frickin a wayfair store?
Anne 29:53
I don’t know, I don’t know I think that’s its own brand.
Chris 29:56
That’s your brand.
Anne 29:57
Yeah,
Chris 29:58
Wayfair right. What are you gonna have all these Separate brands of a store makes no sense.
Anne 30:02
I guess I just feel like Wayfar is huge. I think you start like looking like a Bed Bath and Beyond if you just do away for a store
Chris 30:09
That’s my that’s my point the initial rant like make a big frickin store like an Ikea make a mega store under the wayfarer brand.
Anne 30:15
Okay,
Chris 30:15
Hit IKEA where it hurts. You can be better from them from an omni channels person Wayfair for Christ’s sake. Alright, sorry. Wait for for Christ’s sake, like we just talked about unless it’s having to rewire all their operations for E commerce.
Anne 30:26
Yeah,
Chris 30:27
You can build the store fresh from the ground up and do it better than them
Anne 30:29
Right exactly.
Chris 30:30
and offer more. Here’s the other piece that’s different.
Anne 30:32
Yes,
Chris 30:33
wayfarer’s one. IKEA is one aesthetic. We can offer a variety of aesthetic
Anne 30:38
Sure.
Chris 30:39
People want to go get that chore done on a Saturday, Sunday furnish their house, they don’t just always want the IKEA aesthetic. That’s the opportunity here, folks. That’s what Wayfair needs to understand. Alright I’m done.
Anne 30:48
Okay. All right. We’re gonna go on to headline number five before you absolutely lose your mind. So
Chris 30:54
Aneurism
Anne 30:55
wrap wrapping up the this week’s headlines headline number five, according to payments.com, Nordstrom announced this week that they’ll be sunsetting Trunk Club, which they purchased in 2014 for $350 million Nords. Really I know it was it’s crazy. So Nordstrom is eight year run with its trunk club subscription business is coming to an end as a luxury retailer said in its q1 earnings earlier this week that it’s taking customer styling efforts in a different direction with greater emphasis on in store and online fashion advice.
Nordstrom CEO Eric Nordstrom said “customers spend seven times more in report higher levels of satisfaction with when engaging with the stylists either in store or online”, noting also in this report that in store styling was still the top choice. But the demand for digital advice was seeing rapid growth, thus the shift in resources away from Trunk Club and into in store. Nordstrom stylists and experiences. Chris, you have some thoughts on this?
Chris 31:53
I do have thoughts on this one, too. I mean, I think this this one’s kind of a sad story to me in a lot of ways.
Anne 31:57
Oh, yeah.
Chris 31:58
I think it’s a lot. There’s a lot we can learn from the store, I think Anne like, first, I mean, the sad part to me is the acquisition I think was misguided from the beginning. Because if you stop and think about it, Nordstrom is about service. Why should Nordstrom customers have to pay a monthly subscription fee to get better service,
Anne 32:14
It’s a great point.
Chris 32:14
When you think about it that way? So it seems antithetical from the start. And then secondarily, I would say, I’ve said this on the show, many times, people should never get caught up in the idea of subscription services as a as a trend, you know, their function, their function, the reason they exist is because they’re a function of the business model economics of E commerce, they help to defray the cost of shipping.
Anne 32:14
Yeah,
Chris 32:14
That’s their primary function. And so at the core, there has to be something to warrant the subscription, which is the big takeaway for me here. In this day of mobile shopping, clienteling live stream commerce, which you just talked about, really, you know, articularly there’s more cost effective ways to create personal relationships with your customers, both for retailers and the customers themselves. So I think what it signals to me too is look out Stitch Fix.
Anne 32:57
Yeah,
Chris 32:57
I mean, your days are your days could be numbered
Anne 32:59
I mean Stitch fixes days have been number for a while.
Chris 33:02
I mean, we’ve talked about that before, but like, you know, this is just
Anne 33:06
Yeah,
Chris 33:07
More fuel the fire but the point for me is really like if you get down to it, like it didn’t make sense for Nordstrom from the beginning. And wow, that price tag was huge.
Anne 33:15
Yeah, yeah. I mean, I think they they likely learned some things though from this experience about how to create better, you know better in store experiences, how to make the Nordstrom site better what people were looking for in those conversations with their stylist with the subscription services early on, because Nordstrom excels in like video on their product detail page. They are one of the first retailers to have their store associates already doing what firework is helping retailers do where they are touching the product.
They’re describing the product in a video so that I have the confidence in spending you know $500 on a leather jacket. I think the other part of this too is that the Nordstrom has the quality like the subscription services are fine, but the quality is mediocre at best. So they may have been able to capture a new Nordstrom customer because you know they were offering a little bit lower price point through the subscription services overall. But I think you’re dead right. I think that the point here is that Nordstrom can now take what what is a better shopping experience for me as a customer overall. Being able to see something see a video connect with a live person in the Nordstrom store if I want to be able to help me decide if I want to purchase it and then get it that day like in an hour. I can go pick that up from Nordstrom who is best in class and service and I know will have that product ready for me will bring it out to my car curbside or ship it to me that day like that is the prime experience that they need to focus on so I’m not at all surprised to see them sunsetting this and focusing efforts and resources in an area to support the store
Chris 34:51
100% It goes back to what we said the last year you have to know your brand. Your brand in Nordstrom was service in this way you’re describing I think you said that beautifully. That’s exactly what’s going on. The other point I raised too is like, I think it’s funny. I think you do too, as I say this you like, when we talk about, oh, we learned something. It’s $350 million worth the lessons learned.
Anne 35:10
Yeah.
Chris 35:11
Do you think like, I mean, I, that
Anne 35:13
2014 was a different time Chris.
Chris 35:15
You know.
Anne 35:15
2014 was a different time. I mean, there that was, you know, early on in the acceleration of subscription services. So probably made sense at that time now. No way. But
Chris 35:26
Yeah, it’s just funny. I mean, it’s just word word of caution to retailers that are looking at companies when they’re sexy. And hopefully, you know, finding the pay off from them in the long run, which is a hard pill for me to swap here and $50 million when you have employees clamouring to make more money that are actually working in the stores.
Anne 35:41
And to be fair, no one could have predicted the pandemic happening and accelerating, all of the other retailers being able to put together buy online pick up in store services, and the concierge clienteling services that they did in the last two years. So maybe they could have gotten a little bit more runway out of that 350 million. But
Chris 35:59
yeah, that’s I mean, fair point, fair point. But yeah, I mean, in hindsight is always 2020. And it’s unfortunately one of the easier things we get to do on this show, but it’s a you know, something to think about. Alright, Anne let’s go to the lightning round.
Anne 36:11
All right, Chris. Question number one Asian and Hispanic DTC grocer “We” wants to make online food shopping more fun and immersive by showcasing videos and sharing stories behind the ingredients that it sells. They recently hired Crazy Rich Asians director Jon Chu, as chief creative officer to help make this happen. If you could have one celebrity join you to make a Tik Tok about your favourite product, who would it be? And what product would you two be peddling?
Chris 36:37
Oh, that’s a great question. You know, I thought initially I go with Tom Brady. That’s what’s going through my head too much.
Anne 36:42
Yeah for sure. okay okay okay.
Chris 36:43
I want to go to Tom Brady. Well, all that often, even though he goes along with me anytime he wants. I think I would say Jon Hamm selling me a yeti mug.
Anne 36:53
Oh,
Chris 36:53
yeah.
Anne 36:54
Okay.
Chris 36:54
Anne you know why? Why? Because both of those things just say testosterone to me.
Anne 36:59
Oh God,
Chris 37:00
Which you know, I need a lot of so Anne Pepsi just launched Pepsi Roni cola infused pepperoni topping for pizza. Which collab from Pepsi would you rather try Pepsi Roeni, Pepsi Roni pizza, maple syrup flavoured Pepsi or Chinese Or a Chinese food and Pepsi parrot.
Anne 37:18
Oh my gosh, I’m gonna have to as much as it is so disgusting to me. I have to go with Pepsi Roni pizza because I think pretty much pizza can camouflage just about anything. So yeah, the maple syrup flavour Pepsi made me throw up in my mind.
Chris 37:33
Like, I feel like that’s my choice because it’s like more the sugar ballpark each other. Like, I could think of putting Pepsi on my waffles maybe? Alright.
Anne 37:40
All right, Chris. Boston Beer is shifting operations from truly to a new THC infused tea they are calling tea pot, which they will be launching in Canada with specific cannabis strains to enhance your specific times of day.
Chris 37:55
Oh Wow.
Anne 37:55
When was the last time you can recall that you could have used a tea pot.
Chris 38:01
Oh, Anne probably during that Walmart ran 100% For sure. 100% That would have been the exact right time. Alright, Anne last one MasterCard is launching a biometric checkout tool for retailers that will allow customers to smile into a camera to pay for products. Would you rather smile into a camera? or wave your hand over a camera? All Amazon’s palm payment system?
Anne 38:23
Yeah MasterCards doing both of these things. I gotta say I’m still gonna go all in with the palm payment.
Chris 38:28
100%
Anne 38:28
I feel like something so creepy to me about like just looking into a camera and like smiling even like for Clear.
Chris 38:34
Do you like it for Clear.
Anne 38:35
No, I feel like weird. I don’t know. I mean, I don’t mind that they’re scanning my eyeballs. I’m not like freaked out about it. Like I know a lot of people are but
Chris 38:42
I don’t want to do that to shop.
Anne 38:43
The whole fact. I have to smile.
Chris 38:44
Yeah,
Anne 38:45
Something I don’t like anybody telling me to smile.
Chris 38:47
Yeah, that’s weird. All right. Yeah, that’s weird. Yeah, I don’t want to do it to shop. Alright, Happy Birthday today to Lenny Kravitz, Stevie Nicks. And one of the more under appreciated actresses out there. Helena Bonham Carter. And remember, if you can only read or listen to one retail blog in the business make it OMNI talk. Our Fast Five podcast is the quickest, fastest rundown of all the week’s top news.
And our twice weekly newsletter tells you the top five things you need to know each day and also features special content exclusive to us and just for you, and if it’s all within the preview pane of your inbox, you can sign up today at http://www.OMNItalk.blog. Thanks as always for listening in. Please remember to like and leave us a review wherever you happen to listen to your podcast or on YouTube. And of course, as always, be careful out there,
Anne 39:29
Especially this Memorial Day weekend. The Omni talk Fast Five is a Microsoft sponsored podcast. Microsoft Cloud for retail connects your customers, your people and your data across the shopper journey delivering personalised experiences and operational excellence and is also brought to you in association with the a&m consumer and retail group. The a&m consumer retail group is a management consulting firm that tackles the most complex challenges and advances its clients people and communities toward their maximum potential. CRG brings the Experience tools and operator like pragmatism to help retailers and consumer products companies be on the right side of disruption. And takeoff. Takeoff is transforming grocery by empowering brochures to thrive online. The key is micro fulfilment, small robotic fulfilment centres that can be leveraged at a hyperlocal scale. Takeoff also offers a robust software suite, so grocers can seamlessly integrate the robotic solution into their existing businesses. To learn more visit takeoff.com. And finally sezzle. Sezzle is an innovative Buy now pay later solution that allows shoppers to split purchases into four interest free payments over six weeks. To learn more, visit sezzle.com
Omni Talk is the retail blog for retailers, written by retailers. Chris Walton and Anne Mezzenga founded Omni Talk in 2017 and have quickly turned it into one of the fastest growing blogs in retail. 