Transcript of Fast Five Episode: Schnucks Gets Smart, NRF Predicts A Big Back-to-School & Target Shorts Itself

00:00:05

Hello, you are listening to the Omni talk Fast 5 brought to you. In partnership with the A and M consumer and retail group Firework, SPS Commerce and Sezzle ranked in the top 10 of all podcasts globally. The Omni Talk Fast 5 is the podcast that we hope. Makes you feel a little smarter, but most importantly a little happier each week too. Today we’re back. It’s July 20th, 2023. I’m your host, Ann Mezzenga.

00:00:33

And I’m Chris Walton.

00:00:34

And we are here once again to discuss the most important headlines from the past week that highlight how the physical, digital and human elements of retail are coming together to shape the future. And Chris? Joining us joining us today back for their regularly scheduled monthly appearance are two of our friends from the A and M Consumer and Retail Group, Abhinav Chandra and Manola Solar. Abanov, this is this is one of your second or third time being on the show Third time and Manola, this is your very first time. So welcome to the retail FAST 5. Thank you. Very excited to be here. Yeah, Nola, did these guys give you any advice? Did the crew give you any advice in terms of how to prepare for the show or, you know, or do they just leave you hanging out to dry? Like, tell us about that.

00:01:27

You know, I’ve been watching following pretty closely as they’ve kind of gone through. So, you know, I’ll try my best to live up to the the good work others have done. But you know, some emails may have been exchanged.

00:01:41

Hours and hours of prep too, I’m sure.

00:01:43

100%.

00:01:43

100% hours and hours days of prep.

00:01:47

Days, yes. Well, Manoa, why don’t you share a little bit with the audience about your background since this is your first time? Yeah, happy to. So my name is Manola Soler. I’m a Senior Director with the CRG practice at A and M and my background has been mostly within the prestige beauty space as well as apparel. I have both industry and and consulting experience on the apparel side. And you know, I’ve kind of run the gamut from my early career, has started out more in the creative design side of the business and then I’ve, you know, kind of pivoted over into more of the the business side of things. I tend to do a lot of work that’s kind of growth focused and consumer centric. So this is right up my alley and really excited to be here. Fun, We’re so excited to have you. We’ve got some good stories for you today, Abhinav. For those who may not have caught your first or second appearance on the show, tell the audience a little bit about your background.

00:02:49

Yeah. Thank you, Ann. My name is Abhinav. I’m a Managing Director in A and M’s consumer and retail group. I’ve been in the retail world what 1516 years now, Started off in this world at McKinsey and Company as a consultant. After that I was at Amazon, I ran the agreements clothing business and then I was Head of Customer Experience. And now I’m at A and M and looking forward to the show and discussion today.

00:03:15

Excellent. We are so excited to have you both. Chris, Are you ready to kick it off? Are you feeling like good to go? We’ve got two experts that are going to be joining us.

00:03:25

And I’m so ready for this. I’m so ready for this. And the topics are quite fun today. So it’s great to have the A and M folks on with us. It’s always, I say this every time, it’s always my favorite show of the month because we just sit back, listen to their insights, let them do their thing, and I’m raring to go. And but before we get to the headlines, Ann.

00:03:41

Yes.

00:03:42

We’ve got some exciting news for our retailer and brand folks out there. Grocery Shop is offering complimentary tickets and a crazy good reimbursement for those who qualify through their exclusive retailers and brands program. But hurry, this offer expires at the end of the month, so don’t miss out. And to our tech listeners, don’t you worry they have something special for you too. You can purchase guaranteed meetings with retailers and brands and let me tell you. These slots are flying off the shelves. They’re expected to sell out by the end of the month as well. And one last and very important thing that I want to mention and Are you ready for this one?

00:04:20

Yes. Are you announcing the The Musical guest?

00:04:23

I am not announcing the musical. Guest. That’s coming later I’m sure, but. Today. Today, possibly even bigger and if you’re if you’re really a big retail geek like I am. Today, Grocery Shop announced their latest keynote speaker edition, and it is none other than Steven Williams, the remarkable CEO of PepsiCo Foods North America. He’s the driving force behind Pepsico’s staggering $26 billion foods business in North America. So Needless to say, dude is kind of a pretty big deal. So there’s lots of great things happening over there at Grocery Shop and we are loving it. So remember, if you want to learn more, head over to groceryshop.com/omni talk. That’s Grocery shop.com. Slash on Utah. All right, In today’s Fast 5 headlines, we’ve got news on Schnucks doing smart cards with Instacart, H&M saying it plans to sell more third party products, Signet Jewelers getting into resale. Target allowing its store employees to wear shorts. Oh my God, is that going to be a fun one? But we begin today with a read of the economic tea leaves. And would you start us off?

00:05:29

Oh, yes. All right, headline 1. NRF said this week that it expects back to school to reach unparalleled high highs. Chris Unparalleled correct quote Yes number one for hyperbole. NRF According to Chain Storage, back to school spending is expected to reach $41.5 billion, up from 36.9 billion last year and the previous high of 37.1 billion back in 2021. The increase is expected to be driven by. More demand for electronics as 69% of backschool shoppers say they expect to buy electronics or other computer related accessories this year, up from 65% last year and the highest in the surveys history ever. This news also comes after recent reports of good news on inflation and overall consumer sentiment. Abhinav, I’m I’m curious. I’ve got to go to you. Are you bullish on the sentiment from NRF or do you think we should be looking at back to school a little bit more cautiously? How are you advising your clients to kind of approach the next few months a?

00:06:39

Little bit more cautiously. Yeah, I think the trend that they’re talking about that it is going to be higher than last year. I think that is correct. I’m not sure of the magnitude. Or I’m a little bit more cautious on the magnitude here here. Here are some puts and takes that the way I think about this, I heard in multiple stories and read on multiple stories that the enrollment in colleges is not back to pre pandemic levels and it is increasing. So another data point I have is my in my own home I have two young kids who go to summer camp and this year they are going in person and the camp that they are going to is a UC Berkeley camp. And they were saying pre pandemic they had 900 kids in the camp last year they had 600, this year they have 700. So again, I think the number of people who are going to be shopping for back to school, back to college, I think is going to be higher than last year. That I totally understand. Inflation is also there. So that should increase the the, the amount of sales that people have. However, people are trading down. That’s a trend that I totally see. Trading down and focusing more on essentials. So that’s one part of the story. The second part of the story, I’m a little bit surprised about the focus on computers and electronics because in the pandemic in 2020 and 2021 when people were home, they bought a lot of electronics and to go into a two year cycle and replace all of that, that seems a little bit too much. So yes, that’s why I have a little bit more caution. I think it’ll be higher.

00:08:23

Right. But higher by 9 or 10% compared to last year, I’m not so sure. So slow burn going back, it’s not going to be this like rapid increase. Stay cautious and a little bit reserved and be mindful of those consumers who are trading down who are making some more economically focused investments. Manola, any anything you’d throw in or add there that you you’re hearing or that you’re you’ve been talking to your clients about? Yeah, I mean I I tend to agree, right. I’m not super bullish and I I would expect some some growth, but I think a chunk of it is inflation driven and you know to just build on what Alvena was saying. The, the shift in mix is going to be you know still still there and and it’s an interesting one and yeah, the people going more value more who’s going to win I think from from this growth is going to be an interesting outcome and I don’t think it’s going to be, it’s not going to be equal across the board, OK.

00:09:22

Yeah. So interesting. So you guys think like there could be some growth, but it’s not going to be like gangbusters for everyone. That’s your point there, Manila.

00:09:28

Yeah, yeah. I think it’s going to be two different stories as we kind of look back on it. Chris, throw your thoughts in. What are you thinking?

00:09:39

Yeah, I mean, I it’s hard to know. I mean I I I think the smart play is to think about it like Abhinav and Manola are, you know, because and we had a great conversation about this earlier this week. We had placer a I on our asking expertise on LinkedIn, Ethan Chunovsky and he was talking about how. Traffic patterns appear to be improving in June in addition to the reports we’re getting on inflation and consumer sentiment. So all things are pointing toward it being a good back to school season and that was pretty broad, those traffic patterns. But then someone on on the webinar asked a good question. She’s like well, but you know June’s also a pretty big, big markdown month in retail overall. What impact did that have on the traffic numbers, the lower prices that? As retailers are clearing through their inventory, shout out to her, Christy Weller, former colleague at the Gap, for asking that question too, because that that stumped all of us. We’re like, okay. Yeah, maybe that’s a factor. So I don’t know. I don’t know the answer to that. Put the gun in my head, though. I think it’s going to be a good season. I think the big players like Walmart, given what they announced last week, like we talked about on the show, they’re going to win the season, they’re going to do well. But I I would be, I’m kind of in the Knowles camp, like I don’t think everyone’s going to win here.

00:10:46

Yeah I think you guys are bringing up really good questions and I was thinking the same kind of thing like where will the growth be? Is it going to be the big box and off price or I mean when we talk to Ethan you know players like lululemon still showing like really strong strong results. But is that going to be a place where we where you know back to school is still heavy or is it more on the off price sector are people going into you know get their their their. Apparel products for example, are they going to Amazon, are they going to Target, are they going to Walmart for back to school versus you know some of those other investments. I think that’ll be kind of fun to see and I want, I want to see where resale comes into play here. Like I’m curious where that you know where that spend comes in too. And if we’re seeing a move like AB and I was talking about you know trading down or going to like some of these other marketplaces to stock up for back to school or if we’re seeing strong in the, you know the first time by especially. Be in the apparel sector, so we will see.

00:11:47

All right, yeah. Back to school. Heavily dominated by school supplies, electronics and apparel. Those are the three big categories. All right, Headline 2, Schnucks and Instacart are doing smart carts together. According to an Instacart press release, just yesterday, the two companies announced their plans to deploy Instacart’s caper cart. Loyal Fast 5 fans will know that caper carts automatically identify items as they are added to a cart using computer vision. And artificial intelligence, which for short is a I, which allows customers to bag as they shop, skip the line and seamlessly check out on the cart from anywhere in this store. The caper carts will first roll out at select Schnucks St. Louis stores this fall. That was 3 S’s, No 4S’s in a row for those keeping track. And there’s a broader rollout plan later this year following successful initial deployment. Manola. Question for you is why would Schnooks throw Instacart a lifeline like this? What could they possibly be thinking here?

00:12:47

I mean that’s a that’s a great question to be to be very honest with you. You know I think they they have a focus on kind of staying on the on the forefront and kind of experimenting and really you know honing on and creating that increase or improved consumer experience. You know, for me? On whether this is gonna gonna hit the mark. You know, it seems like a like a lot of work for for not so much payoff from a from where I’m standing, right. Relatively high investment, you know, in theory could address shrinkage concerns but can also see people not putting stuff in the cart. What happens, you know then And I’ve seen kind of. Granted earlier not as smart versions of these types of systems try to get rolled out and it ends up being clunky, right? It puts a lot of work on consumers to kind of do the process, and there’s probably lower cost alternatives that are already pretty well established out there. Self checkout with the right parameters to avoid a shrink seems to get the job done, so I think it’s worth experimenting and refining. But I don’t think it’s something that’s going to be, you know, RAW. It’s not there yet, right? So, but.

00:14:10

Got it. So you’re kind of you’re kind of in the camp of like this is kind of like they’re just dipping their toe in the waters to see like what they’ve got here is, is there something here, how hard is it for the consumer to adopt these new processes around smart cart shopping that’s that’s essentially your take.

00:14:25

Yeah. I see this as a as a test and and learn and I’m sure you know some learnings will come. But this I it’s not something that I that I think is gonna be widely adopted. I don’t know that that’s their their plan but if I had to guess looking outside in I, I think it’s just a test and you know what can we learn what are some some takeaways from there but.

00:14:47

Yeah, which is important too. AB enough. What do you think? OK, I’m going to put my cynical hat on here. Yeah, OK. I love your cynical hat. It’s your best hat that you wear.

00:14:56

Yeah, it’s gonna fit. You the best generally so cynical hat. In this day and age, everyone has to do something in technology, even if they don’t need to. They had. They want to or they have to. So Schnucks is trying something, which is great. Fine. So that’s my cynical hat and I don’t know if you Have you guys seen the caper cart? Yes, you have. OK, so I’m going to draw a parallel which which may or may not be true, but it reminded me of Peloton. So here is the here is the connection someone described to me Peloton as an exercise bike with iPad bolted on it. This cart is a cart with an iPad bolted on it. Does it mean that it is going to go the same route as Peloton? Well, I guess time will tell. My take on my take on this is similar to Malone as that. I mean the customer experience is going to be a little bit clunky. We’ll put a lot of sort of owners on the customer to deal with this. It is technology. They will have to learn a new device to handle these kinds of things. And my view is long term, the solution is something to do with the phone that the customer already has knows how to use it. I know of startups that are that are basically mapping out the whole store, providing a view of the inventory and pricing in a single app. So if you can think of you have a phone, it tells you OK, you tell it what you want to shop, it takes you there, gives you the price. You pick it up, maybe you scan it with your phone and you’re done. You don’t need a card to do all of that. And so I think that’s a long term play, but that is a little bit expensive to do at the moment. In early stages maybe this is sort of a stopgap, but again. I personally have not used it. I would like to see what the customer experience actually looks like. Right. Right. For sure. So you’re kind of you’re kind of a kind of the mindset like we talked about in the show like you you can see this could be like fun to test but you see A potentially being disimmediate in the long term as solutions that require less consumer adoption come into play. Say like the system’s like a tree door or an I5 like we talked about in last week’s show. And what do you think though? I’m gonna, I think I’m gonna spin this in a very unexpected direction but go ahead and.

00:17:34

All right, Dave stuck. We need to have a beer. I’ve got Dave laughing already through this. This is what Dave second Schnucks, I got some questions for you. I have no doubt he will answer. Dave first I want to say I trust you. I don’t understand it, but I trust that you’re doing this in the right way. I think they’re testing and Abhinav, you mentioned this like they are testing this in a couple of different ways. They’re not just doing the, you know, the cart reads automatically to see what you’re putting in the basket and they’re also doing it where the consumer is scanning the product and then putting it in the basket. So I I like that they’re going about this in a few different paths to learn as much as they can. But I have two more questions. Are they going to only have caper carts in the store? Is this like a side by side A/B test or is it just a store with caper tests parts right? And if not, are they doing anything about controlled entry and exit? Like how is this test going to be controlled? Because I feel like this even if it was successful, it could get killed there. Manola brings up other issues of shrink potentially happening as a result. So I I want to know more about the experiment. Dave, so you owe me a beer at grocery shop. That’s what I have to.

00:18:47

Say, wow, all, God, these are all really great points. I mean I’m, I’m going to, I’m going to, I’m going to kind of blow the doors off this conversation a little bit. So I’m going to make a very grand claim here, which is that I think this announcement quite honestly to the three of you, this cements Schnucks as the most innovative grocery in America in my opinion. You look at. Yeah, I mean you look at what they’ve been building over the then this is not a tech flight of fancy. This is not them. You know I if I push back on the point of like they’re just trying something in tech. They’ve been doing smart things around tech for a while and they’ve been building the basically a smart return, a smart smart store that can actually have a good return on investment. That’s what they’re going for here. You’ve got ESL’s in their store, they’ve got robots monitoring prices and inventory outs in their store, They’re using Eversite to make price changes by way of the relationship with Instacart as well. And so now they’re attempting to try to give the customers that just walk out experience with the builtin screen right in front of them like they said, you know, like you said Abhinav, for the retail media network to happen, it’s probably being secret mental revenue. So Dave, sex probably laughing at me when I say this but mazel tov man. Like you guys are doing a great job. It’s the the point the why I emphasize what I did with Manola was it’s the right way to do this. You’re making small incremental bets to understand the right steps going forward. The trick here though is unlike those other things I mentioned. Bob and Obs. Dead right. This is the first one that requires the customer to do something different and that’s why I’m not solely bought on bought in on this being the right solution in the long run. Is it that much better than a self checkout experience? Is it better than the long run? You know, computer vision assisted just walk out experiences? Those are the questions I have but you can’t learn that unless you do this and final word.

00:20:33

Yes. No, I agree that so many questions, Dave. We’re going to be locking you down. Grocery shop is just a few months away and I fully expect to get get. He’s got to sell us on this Chris, but if anybody can, it’s Dave.

00:20:46

Yeah, yeah. And I I know them. Yesterday when he didn’t get, surprisingly, he didn’t get back to me because he probably doesn’t want to talk about this yet. But we’ll catch.

00:20:52

Up at some point.

00:20:53

Let’s go let’s.

00:20:54

Go on to headline 3. So H&M wants to sell more third party products. According to the Wall Street Journal, H&M is, quote, moving further beyond its eponymous clothing label, doubling down on beauty products, housewares and selling products from other brands to draw in more shoppers. And quote, the retailer is opening standalone beauty and home stores, expanding the other handful of chains it owns, including the upmarket brand costs. And St. fashion label weekday, it’s also selling more third party brands including Adidas and New Balance sneakers in its stores and online. Manola, I, I want to go to you first on this one. What do you think here? Are these good moves from H&M or is this like the last ditch effort, the Canary in the coal mine that signals maybe some more broad issues happening over at H&M? Yeah, I think it’s. It’s a mix, right, Okay and some moves make more sense to me than others. Yeah, break it down. They’ve been doing on the beauty side, for example, they’ve been doing beauty as part of their HM assortment for several years now and it kind of makes sense if you have people in the. Door might as well kind of expand in that wallet and how much you know different categories spend you can you can get with them. So I I get that I get the you know expanding into other brands quite selectively where it makes sense right. Maybe Adidas sneakers are more of an outfit completer than HM branded sneakers you know for for a lot of people. So I track with with that gets a little bit outside of the core for me when you get into into home. Right. And I I think a lot of brands and companies kind of jumped on the home bandwagon because the whole, you know COVID everyone was stuck at home and we all bought you know way more cushions than we than we needed. But the Hud’s you know probably gonna gonna simmer down and taper off as well. And then the other thing that I was reading about, which for me drew kind of a question mark is this idea of them opening kind of freestanding beauty focused stores. Yeah, that movie, you know, we kind of saw that movie with with Forever 21, right? And they’re kind of Riley Rose and and and that didn’t really play out very successfully, right, because you start losing the brand equity of why people came in the door in the 1st place, right. So that to me is a little bit, you know, a step too far from from the core. But I I do think there’s. You know value in that in adding of the marketplace selectively where it complements the the assortment and you know kind of gets you the to ring the register versus having them go you know across the street and buy the same sneakers from someone else. Right. But yeah, the freestanding beauty might be a bridge too far for me. Yeah, I mean, beauty is, you know, this better than any of us. I mean, beauty is a very competitive space. And if you don’t have, you know, what I think what I’m hearing from you is like you really have to have that unique point of view, that unique perspective on beauty to really Dr. consumers there, especially as a standalone store. It’s one thing to pick up a nail Polish or a lip gloss while you’re in an HM, but when you’re really trying to go after that core beauty consumer. You got you got a lot of competition in that space. Yeah, Abhinav, do anything else you’d throw in there?

00:24:16

Yeah. I think my point of view is there’s a lot going on in the things that you just mentioned that they’re trying to do. It’s it’s not one thing. And given the fact that if you look at their earnings over the last whatever 7-8 years they were at this point, then in the pandemic they went like this, they are just coming up. To the level that they were at 4-5 six years ago. I I think they’re getting pushed to sort of drop, give more vote like if you did six years worth of work and you are at the same level that you were six years ago, then what you spend a bunch of money, where are you at? So I think they’re trying to drive growth, they’re trying trying multiple things and I’m with with Manola that it seems a little bit confused to me. The beauty for sure. I do agree with all that you guys said. On the third party side, them putting, I mean more selection means more sales. I mean that’s typically clear. And if you are bringing in brands that are named brands, they are going to draw more traffic in your stores. I mean I think is the store profitability down, is that why they are bringing in more brands to drive more dollar per square foot. So that’s why I think you are right, this may be some sign of some trouble I guess.

00:25:33

Yeah, Chris, are you in the same boat you think that you think HM’s in trouble here? You like this move?

00:25:38

No, I’m more I’m more in Manola’s camp where I can tell, you know, you know, from. I thought I would. The thing I was thinking about when she said that was spoken like a true merchant, somebody that understands, you know, this side of the retail business. Because I mean I can remember back in my Target days, I used to, I used to get into fights about people that wanted to ride or die solely with their own brands. And my whole thought was like. That’s not, that’s not merchandising though. I’m a big believer that merchandising about picking the right products that your customer wants and expects to find with you the most. That can be own brands, it can be thirdparty brands. So to the point, if like if I want a pair of Adidas with my outfit that I’m buying H&M, then stock the Adidas, why not? Like it’s just a winwin all around when you think about it in that way and it’s the job of the merchant to pick the right products and put them in their stores. So that’s my main point here. The idea about going after beauty as a standalone store, I think those points are valid. I think you know, that’s an experiment like anything else. You just can’t get too far in front of your skis on that before you start to understand how well it’s doing for you. But I don’t think fundamentally have an issue with anything in this in this Wall Street Journal article.

00:26:39

Yeah. I think the only thing I’d add here is that H&M has such a massive assortment. Like I think if you are, if you’re H&M right now and you’re really trying to. Make some progress here economically, like I think you got to pare your assortment down a little bit. Fine, bring in Adidas and bring in some other elements. But I think you really have to have a more curated point of view than what you have right now in order to stand apart and to be successful. And the second thing I’d add is like look at their one of their closest competitors, you have Zara right next door doing the same thing, expanding in home, expanding in beauty, expanding in lingerie and all these categories. And you don’t see or hear about any investment from H&M right now in the tech side of things. And we were at the Zara store in Madrid and the the investments they’re making and making that shopping experience better, the products easier to find, getting in and out of there, making returns simpler. Like we’re not seeing that from H&M. And I think it’s time for H&M to also start to look at that side of the business as they’re expanding into more stores. But ABNOV, we’ll give you the last word here.

00:27:43

Yeah. So one last point is given the inflation and given where the consumer stands, I’m just surprised that even they are in fast fashion, they are at lower price points. Why are they not growing faster?

00:27:55

Yeah.

00:27:56

Right. Yeah. The macroeconomic conditions should have been lined up for them to do better. Yeah. The other point about this too that we didn’t cover is like there’s a difference in expanding your storm in the online space versus the physical space too. And how much of that was discussed in the article is still unclear and where they’re planning to. Lean in on that is unclear too. But all right, in the interest of time, let’s keep rolling on. Headline 4 signet Jewelry is rolling out fine jewelry rental. According to Chain Storage, the program, initially piloted this past spring, is available through a partnership between Zales and Rocks Box, the jewelry rental subscription platform that Signet acquired in 2021. Yeah, possibly my favorite name for a startup every ever at Rocks Box. The program is available by appointment at 50 sales stores across the country and meant to be an affordable fine jewelry option for special occasion. There is also an exclusively designed collection for the rental program, which features 36 pieces consisting of necklaces, earrings, bracelets and rings and the jewelry is all fashioned in 10,000 carat or 10 carat, not 10,010 carat, 10 carat and handset with lab created diamonds. For those interested, this is cool. You can rent items for 14 days for 5% of the purchase price and then you also have the option to purchase anything you rent by applying the rental fee towards the end purchase. Give you some idea of what we’re talking about here. The purchase prices range from 1000 to $10,000 with rentals starting as low as $50. I’m not. I’m actually going to go to you on this one first.

00:29:30

Bling, Bling.

00:29:31

Bling, Bling. Bling, bling, goes the trolley. All right. Do you like this move in the fine jewelry space? And what do you think it says more broadly about resale, if anything at all? Yeah, I think it’s a good idea to try and test the and they’re doing it in 50 stores, which is, which is great. I think this model has been played out in apparel a lot. You’ve seen it in multiple places. I think the businesses get to a certain size and then after that it doesn’t scale. I mean, when the runway is an example in bridesmaid dresses, there were a bunch of them. My wife had a startup where she rented bridesmaid dresses, so it definitely has legs and but it caps off at a certain limit in the apparel space. In this, what do you mean by that? Like what are the limiting factors? Limiting factors are, I think the customers who are looking for this kind of service are limited in the market. It’s not a sort of very large market is the way I think about it. In a barrel in jewelry it may be different. Because jewellery is more pricey. Jewelry has more special occasions where you can go for and look for. So I I am interested to see what the outcome is. I think it may work given given. But again The thing is the one thing that I don’t like about this experiment is you have to show up in the store. Interesting that that that that is a friction point. The because you then you have to go to the store and you have to go go through that experience. I I I just wonder if you could do eventually with an online experience where you shop for it, it is shipped to you. You use it you send it back. But yeah that’s the only thing that I’m a little surprised by but I like the experiment and as we said earlier unless you try you will know. Got it. Yeah. No, I like this too. I mean, I like the high price point angle to this. I think for me, you know, it gets people potentially into the jewelry buying experience. It might not have been in there otherwise, which was kind of captivating for me, you know, like maybe I go get a pinky ring for 50 bucks for the weekend or something like that, you know, my. God, that is the worst image I could put in my brain.

00:32:11

I know, but you know, but like it, you know, it gets you thinking. And I imagine there’s a lot more. People out there that actually want to get jewelry that this affords them the ability to do that. Manola, what do you think here? Anything you’d add?

00:32:23

Yeah. I mean, so a couple things, right. When I was thinking about this from an operational perspective, I like jewelry as like a rental. Category, because I think a lot of the challenges and profitability with with apparel were around the, you know having to dry clean and kind of get it ready for that next consumer right. People will stain the thing. So and you need to get X number of wears out of something you know before it’s before you turn a profit. But so not as much a problem in jewelry, right. It’s lower cost to kind of maintain it. It’s a hard metal thing. So it’s not going to you know hopefully sustain as much damage so from that. Point, I get it. I also like it in the sense of, you know, it feels very like an Oscars moment, you know, make for special occasions, you know, borrowing these diamonds. So I get that resonating from a consumer perspective. To me, the big question mark is they’re really up against kind of, you know, fashion jewelry and kind of you can get a similar look at a pretty low cost. And keep it right versus you know the wanting to to will people want to to rent it when it’s yes it’s diamonds and it’s gold but they don’t get to keep it. So you know there there isn’t kind of that equity that people perceive in buying fine jewelry. So that’s me is a question mark. Can I get a better, you know, a nice looking fake for cheaper and get to keep it or is the emotional element there?

00:33:50

And without the risk of losing it or having the dog eat it and being on the hook for it. Too important point too. And why don’t you once you have the funnel word here and then lead us into headline 5.

00:33:59

I think this is just really smart. I mean, it makes sense to do it as a test. I think as Abhinav mentioned, there’s going to be some friction points. What are you actually getting inside the store and is that collection because the Zales assortment that’s in the store is not the same as the Rocks Box? Box of Rocks is what I keep calling it as the rocks Box assortment and that like I think you like Manola saying like there’s already, this is already part of a lot of the other rental services jewelry as a component. So it, you know, you feel a little less guilty if you lost a $30 pair of earrings versus you know, a $3000 pair of earrings. So I think it’s worth the test though. All right, let’s go into headline 5. So target workers are now permitted to wear shorts, everybody. According to Business Insider, Target has updated its dress code to allow most store employees to wear shorts to work. Previously, only card attendance and drive up fulfillment workers were allowed this benefit, but Target now, according to spokesperson Brian Harper, Tibaldo quote recently expanded that offering to include the majority of store team members and that our current uniform standards asked team members to wear solid color pants, capris, skirts, or shorts in good condition and quote yoga pants and athletic shorts are still not allowed. About however Abhinav Yeah, Abhinav, what in the world would compel Target to do this? And is it a move that you would have advised for your clients?

00:35:27

So what in the world? I think the articles called out that it it has got something to do with the extreme heat that they are facing in the stores, I think.

00:35:36

Inside an air conditioned Target store. Yes, yeah.

00:35:39

Exactly that was quoted. I, I, I I would, I would advise it. I think it’s people wanted. I think it may. I don’t know how big of a deal it is but it is it could be used as a draw to attract folks to take on the roles like to hire people that that is key. But having been on the operation side of stores for a very, very long time I do see. People interpreting it in all different sorts of ways. So uniformity from an operational perspective is always good. I think that’s why they were going down it. But in this day and age, everyone else is doing it. You got to do it. But yes, they will have to have some, at least they will face some operational challenges initially making sure everyone interprets it the right way. But I think they will. I mean, they’ll get over it.

00:36:40

Well Chris, I have to ask you, you were of you worked in the stores like.

00:36:44

I ran Target Stores.

00:36:45

Three, I mean they had this more strict red and khaki like was it there an issue then of like uniform conformity issues like how much of A burden is this on the stores teams to be like sorry, you can’t wear that how much was it and.

00:37:00

There was because a red shirt and khaki pair of pants was pretty easy to understand. Like there’s not, there’s not much, you know, left to debate on what that is. But I think top and I was pointing once you get into shorts. It’s a different question, but you know, I actually pulled some of my friends in Target stores. Yeah, and it was a sample size of two, but they were split. One guy loved it, the other guy didn’t like it. And as I sit back, I’m kind of of the opinion I wouldn’t have done this. And I don’t believe the Heat thing, cuz the Heat thing’s like a three month time, three month. Period of the year thing and maybe even a month period of the year thing. Whereas you know winter, if I see it a lot, people wear shorts in the winter because there’s going to be plenty of people that will. I know I would have if I could. So. And the reason I say that too is like I remember back to my gap days, Ann.

00:37:46

Yeah.

00:37:47

There’s always an issue when companies start to go away from the brand standards that they’ve held here for so long, so I can remember the gap when they went away from board folding. And it’s a slippery slope to get back like the brand standards started to slip. You never went back to that. It’s hard to create that experience, get people reenergized around that experience. So I, you know, I, I, I worried about this. The other part about it too is I feel like these are the decisions that start to happen when you have executives that are leading the company that didn’t grow up in the brand. For executives that are a little bit less experienced in their roles, which is definitely applicable to Target right now, and they’re starting to make decisions that will unwind what has been really decades long definitions of brand experience for the customer. And so that’s what I worry about. It’s like, what do I go if I go in the store and I’m looking around and like, there’s just people in all kinds of different outfits and stuff. Like I’m not going to know who’s going to help me in a Target store. Maybe, maybe that doesn’t matter in the long run, but I think it does.

00:38:43

I totally agree. I mean they said that they’re they’re giving in a red vest so that you can ID the target worker. And this I’m just like, that’s not enough for me. Like it just doesn’t make any sense. And Chris, I’m gonna get you a tshirt that has the gap folding board on it with like bring back the board. Like you should really want it back. I’m gonna throw in your last your last comments here.

00:39:05

I’ll answer Chris’s question who will help the customers in the store. It is the smart card. Yeah, the smart card, right? Yeah, their own mobile phone. But what do you think here? What do you think? We gotta get you in here on this too. What do you think?

00:39:17

I mean, listen, I took a deep Reddit, went down the Reddit, down the hole. Yes, I did. You’re welcome.

00:39:25

Back anytime, anytime. You’re welcome back.

00:39:29

Thank you. So from what I could see from my, you know, deep study of the Target subreddit, it seems like the dress code had been slipping. Right. So this is, you know, a lot of people saying, like, hey, you know, you’re supposed to wear a red shirt. But I see people wearing, you know, things that are not official or like it’s pink looks kind of purple. And that’s kind of and mixed on whether, you know, store by store, they let it slide or they’re more strict on it. So to me, this felt almost like a, you know? Kind of it’s cats out of the bag people are kind of you know not complying with uniform and we’re going to basically change the policy to reflect what’s happening versus kind of trying like okay guys let’s bring it back to to the khakis in red and like really uniform feeling of it. So you know is it a slide kind of to to your point maybe right. But it seems like officializing what was kind of happening under covers maybe not shorts but certainly the red shirts were were seems to be not. Not happening consistently.

00:40:29

And there’s no going back. There’s no going back. Once you do this, you’re not, you can’t go back. That’s what I don’t like about this move. Yeah, it’s a moment or.

00:40:38

It is. It is. All right. Well, Target, we’re waiting to see what happens here. But, man, oh man, I don’t know about this. I’m gonna take us into the lightning round next. Question one goes to you, Abanov. Instacart announced Tuesday that it’s B2B unit has become the official same day snack beverage and supplies marketplace for industrious as US Co working spaces. Abanov, I want to know when you’re at a project at a client’s office, what’s the best snack that you’ve seen stocked in a client’s kitchen?

00:41:13

All right, the best snack I’ve had was on this project. At a retailer. And the snack mix that I had available to me was milk trail mix, beef jerky and fruit Loops. And the reason, and the reason I had those was because, yeah, all of them were available. Why? Because we were in there. Kitchen helping them reformulate these products for their private label.

00:41:47

Brand. OK, fair, fair. I was like Abhinav. Your stomach after that day. Must have been so gurgly.

00:41:58

Things that don’t go together, Fruit Loops and and.

00:42:01

Beef jerky, yeah.

00:42:03

All right, Manola, next questions for you. Over 100 people were recently trapped, literally trapped, during a tour. Of Agatha Christie’s home. They were trapped inside of her house. What is the most haunting experience in your life in which fiction mirrored real life?

00:42:22

I mean, listen, to be honest, when I hear that, all I can think is 100 people in a house. Like what? What? What is this house?

00:42:32

Like a murder mystery come to life.

00:42:33

You know, it’s crazy. Yeah, that is against fire code, I feel. I mean, I don’t know how big this house is, but I mean, it must be quite massive, right? So not to me. It’s like all my brain was like, wait, 100 people? Does he mean 10? Like, what is going on in Agatha’s home? Quite The mansion. Listen, I don’t have, like, a great answer. I live in New York, so I have a lot of, like, stranger than fiction moments.

00:42:59

Every day is a living nightmare.

00:43:01

Every day can be, you know, stranger than fiction for sure. So, but yeah, I don’t know, more impressed with the the size of the real estate there than anything else. All right, Manola, we’re going to go back to you for 3. According to research done by the business of fashion, vintage gap products are commanding higher price points than current gap products. Which would you prefer, a vintage gap item or a current one? You know, I’m literally guilty of this. You know, I I did spend enormous amount of time in the recent weeks looking through eBay for a vintage men’s denim jacket from from Gap, which happy happy to report, I I’ve secured. But it’s the cut, you know it has that. It’s the nostalgia of I guess, the Y2K 90s aesthetic which is not. Has available in the new product that that’s coming out. So I jumped on the Gen. C bandwagon of nostalgia and just you know I bought 1 so and it certainly wasn’t board folded right Chris?

00:44:07

No, most likely not. At that point in time, definitely not. And thanks for that slag, but well deserved. Well deserved. And also the starting from my youth. So I’m very proud to hear that Manila wanted the denim jacket. I think I owned one or two of those. All right, Last one, restaurant chain Taco John said this past Tuesday it is giving up its fight in defending its trademark on the phrase Taco Tuesday. Abhinav, how do you like your tacos? Soft or hard shelled? Sump sumps out. Oh man, oh man. I totally disagree with that one. But all right, both Happy birthday today to Carlos Santana Omar Epps and to the man who had one of the tastiest burgers in movie history, the Big Kahuna Burger, Frank Whaley. And remember, if you can only read or listen to 1 Retail Blog in the business, make it On Me Talk, the only retail media outlet run by two former executives from a current top 10US retailer. Our fast live 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 we do it all just for you, and we try really hard to make it fit within the preview pane of your inboxes. 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 podcasts or on YouTube. And Abhinav and Manola, if people want to get in touch with you, pick the brains of all you great consultants at the AM consumer and retail group. What’s the best way for them to do that? You can find us at alvarezandmarcelcrt.com. You can find me on LinkedIn. Abinav search for Abhinav Chandra Manola.

00:45:47

You can find me at m.solar@alvarezandmarcel.com.

00:45:52

Awesome. Well, until next time. Until next month when the Fabulous AM Retail Consumer group returns for the regularly scheduled monthly appearance on behalf of them and all of us here at Omni Talk Retail. As always, be careful out there.

00:46:07

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