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Hello, you are listening to the Omni talk Retail Fast 5 brought to you in partnership with the A and M consumer and retail group Firework, Avalara, TGW and Sezzle. Ranked in the top 10% of all podcasts globally. The Retail Fast 5 is the podcast that we hope makes you feel a little smarter, but most importantly a little happier each week too. Today is November 8th, 2023. I’m your host, Anne Mezzenga.
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And I’m Chris Walton.
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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. Chris. Yes, and we made it to November. We did as Wyclef would, As Wyclef would say I’ll be gone till November. You’ll be gone till November.
00:00:51
See, see, like like like my rude movie references on you.
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Your musical references are completely oh, come on Wyclef.
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Yes. No. No, no idea. Never heard that song in my life. Couldn’t place it if I tried.
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But, Ann, this is a big day for you. Big day for you, right? Is it today? The b-day? The birthday?
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My birthday? Yes. What are you doing to celebrate turning the tables on you? Here, Ann.
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Oh, what? I don’t. I’m nothing. I mean, I played bingo at a legion last weekend and that’s what I did to celebrate.
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That’s what you did for your birthday. This is how’s it feel. The 1439 though. Ann O42O. I was trying to help you out.
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All right, I’m feeling 42, as Taylor Swift has not even come close to saying yet. No. Yes. How does it feel? Sore soreness when I wake up.
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Night sweats like how many things do you want to know? Because I feel like I could do an entire podcast, just raise awareness about what happens at this stage of life.
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I’m good. I wasn’t expecting night sweats a minute 40 into the podcast.
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But you know, keeping it real, Chris. Just keeping it real, you know?
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Every day it’s a little bit more the older we get, doesn’t it add.
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Thankfully, we have the retail news to save us and keep life interesting. So yes.
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Yes, we do. Yes, we do well, and any big content drops to which we need to alert our listeners to this week.
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Oh yes, we have huge news here, Chris, because you wrote an article in Forbes this week with a catchy title, Catchy in some people’s words. You love a good title. Metamorphosis, how ad free social media could impact retail, which was inspired by our conversation on last week’s show. And I have one more for you, Chris.
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Yes, OK. Great.
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We also have the live interview with Microsoft’s Romeo Bowleball and Github’s Chris Couch on LinkedIn at the end of the month, so make sure if you haven’t already, go to the Omni Talk Retail LinkedIn page. Over 300 people have already registered for that one as well, so you’ll be in good company, but make sure you go to the Omni Talk retail page on LinkedIn if you want to join us, which I can guarantee you’re going to want to join us, Chris. That’s all I have so.
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I think that’s awesome headlines. Yeah, we’ve already got 300 people registered for that event. I’m pretty pumped about it. So I can’t get enough of AI and I am like in AI rabbit holes every single day.
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But you and me both. You and me both. I feel like it keeps coming back around.
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And today’s Fast 5. We’ve got news on Google’s new search features to help users find more discounts. Shein’s reported $90 billion IPO valuation, IKEA discontinuing its in store discount for loyalty members. Doordash alerting customers to potentially bad service if they don’t tip And Jordan Berke joins us for five insightful minutes on 11/11 AKA Singles Day and why? It is still an event that US retailers should not overlook, but we begin today with big news on the physical store retailing front out of Amazon.
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And that’s right Chris, Amazon is shutting the doors on Amazon Style. According to Retail Dive, Amazon will close the doors on its two Amazon Style stores by tomorrow, November 9th. “After careful consideration, we’ve decided to close our two Amazon Style physical retail stores and focus on our online fashion shopping experience where we’re offering new exciting selection at a great value in introducing innovative technology to meet the needs of every consumer, Amazon spokesperson Kristen Kish said via an e-mail to Retail Dive. Physical retail remains an important part of our business and we’re continuing to invest in growing our grocery stores business, which expands across Amazon Fresh, Whole Foods Market, Amazon Go and 3rd party partnerships.”
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Chris, how does this news make you feel?
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And I got to tell you, this one, this one saddens me. I mean, yes, this headline saddens me probably the most of any headline this year. You know, in some ways I’m not surprised, but you know, it really does. It makes me sad because on the surprise front, I’m not surprised because. The experience as it was designed, you know, guy stop style, having to wait for everything to be brought back, that introduces friction into the average apparel shopping experience.
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It wasn’t there before. We’ve talked about that. Like if I’m a guy and I want to come in and just buy a basic tea, that that’s not something I want to have in my experience. So for that reason we are always questioning whether this thing was doomed to fail. But it’s also why I’m really keen to see how they’re doing.
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Just walk out in peril, you know, by way of the Fan stores. Because I think that could really be a game changer as you get as thing as we get right down to it. So so and not necessary for Amazon opening up the concept, but more as a license or of the text. Other other apparel retailers too, some of whom I think and if you think about this really long term like 10 or 15 years out could also be possibly acquired by Amazon at some point too depending on what Amazon learns from the licensing of that technology. So, but the biggest reason I’m sad, Ann, is, and I think you feel the same way.
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I never got to see this.
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I know.
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And and and the time horizon was really short on it too. Like, it was like a little more than a year, maybe two years at best.
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2 years, I think. Total. Yeah, I mean, the Columbus one opened, but probably about a year ago. But yeah, such a bummer.
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Yeah, the California one hasn’t been that long. But like, you know, so like for me, it’s like it must really not have been working too, because Amazon tends to let their experiments run longer than that. But hey, kudos to them, at least for trying it. I think the. It was an experiment unlike one we’ll talk about later that I think was worth trying.
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And so I always give you points for that.
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Yeah, I mean I agree. I think I think that what I’m trying to hold on to here is that there’s still hope. Like I don’t think this is the end of what we’ll see from Amazon and apparel offerings in a physical setting. I think it’s just a a re imagination. It’s it’s doing what Amazon does best taking this back and saying what what were the friction points here?
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Because there were, to your point, there was still some friction points with having to wait, you know and that it doesn’t make for or the ease of a shopping experience that we’re used to especially when we’re shopping apparel on Amazon where you’re just going for white 5 pack of T-shirts like that that this experience was not designed for that. So I think it’s not the end but just going to be a re evaluation especially with the just walk out RFID capabilities that you mentioned that can really make this shopping experience so much better. Especially once I think you could see it combined with a grocery offering if that’s the way that Amazon decides to go because I think that that’s where you really start disrupting the Walmarts, the Targets, the other mass retailers of the world. If you can start to combine that technology which I I believe they’re starting to do. So I think, I think that’s to me where I’m going to hold on to some hope, hold on for one more day as Wilson Phillips would say, Chris.
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OK, I get that reference. Then I get that reference. Of course I get that, you know. But.
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But and bridesmaids and bridesmaids.
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Such a great scene. Yes. Both of those are such great scenes. That’s a great point though. Yeah, like if you could get this to the Super center size operation, then you start getting different logistics, different backroom configurations as well as well that could come along with this, which could play into Amazon’s already strong points of differentiation.
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So yeah, that could be a road we get to. Probably not soon, but yeah, up to 10 years out. You know, 15 years out. Very disruptive, very great idea and I love it. God, I’m getting Jones for this podcast already.
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I don’t want to hold on. And maybe just for one more day. All right. Headline number though?
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It’s like a robot singing Wilson Phillips. That’s terrible. Hold on.
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Correct.
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Like an Oompa Loompa or.
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Something I know, I know, and I’m I’m trying to control the pitch of my laugh too, And as I giggle through that but Google headline 2. Google has introduced new features on search in Chrome to help users find discounts. According to TechCrunch, Google is adding a designated page for deals on search, while Chrome is getting features that proactively look for discount codes and provide users with price insights. The New Deals search results page on Search is designed to help users find products that are on sale from across the web in one designated spot. To access the New Deals page, you need to search Shop Deals.
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Or if you’re looking for something specific, you can search for categories like Shop Sneaker Deals, something I tried yesterday. Google also announced that it’s Chrome browser can now proactively look for discount codes. Chrome will begin showing you products you recently viewed on shopping sites in your resume browsing card when you open a new tab and let you know if it’s currently discounted. Or you can also click the new discount tag icon in the Chrome address bar to see available coupon codes when you visit a product page on a shopping site.
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And yes.
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I’m curious, do these, Do these new features make you want to use Google Shopping for more than you currently do?
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Without a doubt. I think this is one of these smartest plays we’ve seen from Google Shopping yet, So bring it Google Shopping team. So excited for this. We talked a while back when Google was starting to do some different changes to their shopping page on a couple of podcasts ago. But about one of the reasons that I think a lot of people go to Google is to do that price comparison shopping.
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Like, you know what you want to buy? You want to buy a pair of, in my case, like Chrome Slingback pumps. OK, I know that’s what I want. But now going to Google, I’m seeing like, what’s the rate, especially this time of year when you’re searching for these deals? Google has taken the work out of deal shopping for the consumer.
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And I think with consumers spending sentiment right now, like that’s a Dang good thing. Like I think this could be one of the best reasons Google can provide its consumers to go to Google Shopping in in reasons that they weren’t going there before for reasons that they weren’t going before. Now you’ve got this plugin that you can get. I can get emails. I just went into my group Chrome browser on that page.
00:10:53
Yeah, you can turn on to get alerts for for that item so that it just automatically sends it right to your inbox and says, hey, and you know those those pumps you were looking at, now they’re on sale at this site. They’re 60% off. Go snag them now. It’s like Google Flight Alerts too. I mean, it’s like so, so smart.
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I’m getting so geeked up about this, but you tried it. I want to hear what your experience was like. Two geek outs in the I know, I know I.
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Wasn’t expecting this at all today.
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What did you what did you deal search? What was your experience like?
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Oh, I, of course, looked up. Phoenix Suns hats on sale or whatever it was you know and and got a plethora of them.
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Just your your Phoenix Suns hat is my my Chrome sling back pump.
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So, yeah, it is. Yeah, I’m always searching fan gear and but yeah, I mean I I love it. And I I would add, I think your points are dead on because like you’re hitting on the DO which we’ve talked about, which was a hallmark of our conversations very early on when we started Omni. There’s a very big difference between search and discovery and you have to understand what mindset the consumer is in as you’re creating different experiences for them within a commerce experience. Overall.
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And this is about search, it’s not about discovery, it’s about I know what I want and I want to find it at the best price, give it to me, Google. So for that reason I love it, but it’s also like it’s also great. The second reason I say I like it is because it’s also a great way to shop for things when I don’t care about the brand either and.
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So I think, I think categories like furniture, sporting goods, certain types of apparel like fan gear, like I just said, like pumps like you said, pumps like if you don’t care about the brand, that’s a great point. Yeah, it’s a. Great way to go about the brand. I had a price point in mind, but I didn’t have AI, didn’t have a specific brand that I had to have, yeah.
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Yeah. And so, like, but so for like Nike and Adidas, I’m still going to go there. You know, because I want to see what they’ve got right? But but for the other stuff, and I don’t care what, this is a great option. And so it makes me think like I would potentially choose this over Amazon in the battle of search.
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Or at least this gives Google another leg up in that unending battle between those two companies, I think, yeah, that’s. So that’s such a great point I think because yes, you’re right, we are going to Amazon so often when you know what the product is, but you just kind of want to get a variety. But this is giving us a broader picture inclusive of Amazon. I mean we still have the Amazon like the Amazon offering right alongside other retailers that we may have loyalty association with all these things like yeah, you’re totally right. I hadn’t even thought about the the like.
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I don’t necessarily care what brand it is, I’m just going for this specific object. So.
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Which is the wave really, when you think back to the wave of how ecommerce evolved too, like those are the categories that were highly penetrated first. So this is just a further extension of this and a value grab. By Google to make it easier for us as consumers to shop and find what we want. So I I see your point. I think it’s brilliant.
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Nice work, Google. All right, Headline 3, Chris Sheehan is reportedly seeking a $90 billion with a BIPO valuation in the US According to Tech Crunch, the $90 billion price tag is up from the $64 billion valuation it was given in a funding round earlier this year. Chris $90 billion What do you think? Is she an overhyped? Like, is this real?
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Is this really happening?
00:14:13
Wow. And by the way, Full disclosure. So no one take my advice on this in any way, shape or form because I have no idea what I’m talking about and I don’t even really want to get into the evaluation of whether it’s overhyped or not. But you know, I think it’s a good question and we’re going to have Jordan Burke on in a second to explore both Shein and Temu with us because there’s a lot of interesting angles that I think our audience needs to know and but. But on the surface, I mean, I would say maybe I have no idea, but I think the more important point of this conversation is really let’s look at Xian’s business model against some US comps.
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I thought this was a fun experiment I did yesterday and we started having fun with this yesterday. So. So some points of reference, ’cause I don’t think, I don’t think the and I don’t maybe some people are, but the average person may not be looking at the market caps of US retail companies all that often. I have no idea.
00:14:53
Maybe some of the casually over coffee, yeah.
00:14:56
Tuesday morning. Yes, of course. Right, exactly right. So let’s let’s start from the biggest like Walmart. Or not the biggest ’cause you know, Amazon’s.
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Greater than this but Walmart. Traditional Army channel retailers, $45 billion. OK, big one. Then there’s a big fall off after that really. And.
00:15:10
And I and I just a little bit of a gap.
00:15:12
Yeah, I picked some random copies that are in CHI in space. So you got Lululemon, which? Surprisingly $52 billion, Anne, that was that blew me away because you have target then at $51 billion. So Lululemon is valued more than Target right now, which is astounding to me, Gap at $5 billion, Macy’s only at $3 billion and Kohl’s at just over $2 billion. So, and this is all as of yesterday, November 7th.
00:15:35
So so when I look at it that way. When the US comps are, you know, even though they’re smaller in total like I think when you look at the size of the pie that Shein’s going after, I think you have to take this valuation at least seriously because you have to remember that Sheen is a worldwide business. These companies I just mentioned are not they. Their business model goes directly from factory and they also have the best. Some of the best front end hooks of their ecommerce experience going right now.
00:16:04
So, so I’m kind of actually buying into it. When you look at how much business, ’cause there’s a lot of other retailers I could have named with market caps, you know, in the, you know, in the billion dollar range and she and potentially could take a slice from all of those because they’re a cheaper option.
00:16:19
Yeah, yeah, totally. I think it’s really important the points that you call out and just for all of the our audience for the US retailers to be paying attention to, not only because of what their market cap looks like right now, but more importantly, I think how they are changing the expectation of the next generation of shopper, low factory to consumer direct prices, gamification, group buying like all these things. To me, this is like what Amazon did to the retail audience when they came on the scene, you know decades ago, how they changed our expectations of things like next day delivery, how they changed their expectation of assortment, price point, all those things. Sheehan is doing this for that next generation of audience and I think if for nothing, no other reason you’re paying attention to what the expectations are of your future consumers. A.
00:17:10
100% All right and well, let’s bring Jordan in now to get his perspective on Singles Day and the rise of Shein and Timu. Joining us now for five insightful minutes is Omni Talk, friend and CEO and founder of Tomorrow Jordan Burke. Jordan. It’s almost Singles Day in China. Few years ago this was all the rage.
00:17:28
Seems like it’s died off a little bit recently. Is this something that US retailers still need to pay attention to?
00:17:33
Chris, actually now more than ever we believe because what happens in China on Singles Day is going to appear on the front ends of Timu Xian and the other cross-border players that are disrupting the Western markets like the US So if you think about. Learning about what’s happening on cross-border Pay attention to how Pinduoduo that owns TMU, JD, the biggest seller on Walmart Tiktok. How they’re generating demand in China is what they’re going to be applying in their US businesses and Western businesses in the next 6 to 12 months.
00:18:07
Well and Jordan, I think that’s an important thing for the US retailers to be listening to. Can you explain just how much share some of those cross-border players like TMU and Xi’an have with today’s U.S. consumer?
00:18:19
Yeah, so Tmu’s the fastest growing ecommerce business in the US history, and it’s now the fifth most visited ecom app in the country, surpassed Target in eight months. Over the last 12 months, Oh my God, more Americans have downloaded TMU than the Amazon app. Walmart, Target, Starbucks, McDonald’s, Nike, Apple, Home Depot combined. 60 million Americans browse and shop on team every month. And what we’re seeing from a cohort perspective that’s interesting, Anne, is it’s typically lower income middle-aged females that are the first adopters.
00:18:55
Wow, that surprises me.
00:18:58
Yeah, they they they win with that consumer 1st and then they move up market as they mature in a country like the US.
00:19:05
That is unbelievable. All right, Jordan. Well. Timu and Shein aren’t aren’t the first cross-border players by any such imagination. We’ve had Wish before Aliexpress and even others before that most likely.
00:19:17
What makes them Timu and Shein so much more compelling?
00:19:22
Yeah, Chris, you and Anne know more has changed in the last eight years of retail than probably the last 80. And so this generation of cross-border players in our research appears to be much more durable. They’ve got staying power for three reasons. The first is that they source direct from factories. All of the previous cross-border platforms work with distributors and trading companies Timushi and go direct from factory.
00:19:48
That’s a 15 to 50% cost of goods advantage that they bring. Second, they bring what we call ninja level promo capabilities. They are the world’s best, Chris at generating demand by looking at every pixel of the app and making sure it’s exciting using crazy fun promo mechanisms. And constantly optimizing in day rather than in week or two weeks like often retailers. The biggest thing we think on the on the Third Point is that they are subsidized by profitable parents, people with the law that owns team who she and are not now profitable.
00:20:23
So they can subsidized scale in markets like the US in a way that’s really disruptive and allows them to get to that maturity pretty quickly. There’s one more I want to throw out there which I think people discount, which is look at the Ping Duo Duo playbook from China. It also started with lower income, less educated users. But the moment it reached scale, it brought brands like Chanel, Nike and Apple onto the platform and ultimately moved up market to attack JD and T Mall. We see that same trend playing out in the Wednesday get mature.
00:20:59
Jordan, are there retailers in the US who have? Been successful in defending against Timu and Xi’an and if so where?
00:21:08
Where should US retailers listening, be looking for inspiration or to try to get a hold on what to expect from from these retailers, these cross-border retailers and globally? And in the US, we’re still in the early stages of the response. So Amazon is betting on its same day experience as being its strategic Moat versus Timu, right? You guys have talked at length about it. They’re also working, we understand from inside sources are they’re working on a lower price point version of Amazon where for certain users they’ll be surfacing those sort of discount treasure hunt items that team was famous for.
00:21:46
Omni channel retailers on the other hand, are trying to combine 3 capabilities to fight back. The 1st is loyalty and creating a more sticky experience with the brand. The second is physical stores in the vicinity of customers creating convenience and different experiential elements that can give customers something that the cross-border players can’t. And then third is getting Ninja. You’re seeing across the retail world retailers adopting this demand generation skill set that is like I said, much more about in the moment Tiktok generation promo, really looking at how do I create stimulation throughout the day to be able to engage like they are.
00:22:26
Yeah, it’s kind of scary Jordan. I mean retailers were slow on front end development for the past 20 years, the traditional legacy bricks and mortar retailers. And then when I think about the product categories too in terms of you know what do you need quickly versus what are you not and the fact that you’re direct from factory and you get the cost breaks on that, it’s pretty scary proposition in a lot of ways. So let’s. So let’s get you out of here on this.
00:22:44
What? What’s your audience, which is, you know, a ton of retail executives, you know, particularly here in the United States but also abroad. What should they be on the lookout for as we head into the next couple years around this dynamic?
00:22:57
Yeah, Chris, I think the number one question we get from Omni channel retailers is help me understand at a molecular level, Timu Shein and the cross-border Insurgency. So I think what you’re going to see is retailers really putting the time in to understand why these players are different, why their customer is responding and how their proposition can stack up relatives. We’re estimating that these players could reach up to 50 billion in U.S. dollar sales in the US market within three years. That’s a giant sucking sound that retailers are realizing they’ve got to figure out how to counter counter attack.
00:23:35
And so I think you’re going to find a lot of retailers figuring out, OK, I see how I can compete on value. I see how I can compete on experience. I see how I can create excitement with my user because we see that as a trend that’s not turning around. We think users are going to want that daily dopamine hit that team who’s so effective at creating. And so I think you’re going to see a shift towards adopting some of these practices, but fitting it into your value prop in a thoughtful way, not being team who being you, but just winning, winning in a way that you can uniquely win.
00:24:07
Thanks, Jordan.
00:24:08
Great stuff, Jordan. Great stuff. All right, headline 4. And. And as an aside, doesn’t Jordan look like the priest from Sopranos?
00:24:16
Like he’s like a dead rigger for the priest from Sopranos. But I.
00:24:19
You’re going to have to provide.
00:24:21
Him anymore. Father Intentola is his name and Father Intentola. But yeah, he looks exactly like him and sounds just like him. But anyway, you’re.
00:24:29
Going to have to put that in the in the notes section because unlike people don’t have like a photographic memory of who the hell that person is. And that’s not like just it’s not like Taylor Swift. Chris, you got to give us some reference points.
00:24:44
You’re probably right, but somebody listening to this podcast will know exactly what I’m talking about and will likely message me on LinkedIn telling me yes, Chris, you are 100% right. He’s a dead ringer for it and I said that with affection to Jordan because I’m sure you’re listening at this point too. So, all right, headline 4. IKEA is discontinuing in store discounts for loyalty members. According to Retail Dive, as of February 1st next year, members of its IKEA family loyalty program will no longer receive a 5% discount on in store purchases of furniture and decor.
00:25:15
However, those who sign up for IKEA family will continue to get benefits like exclusive offers, discounts on same on some. Delivery options and a free hot drink when they visit a store and IKEA spokesperson said that the change is part of a wider effort “ to create more value for all our customers and IKEA family members who look to us to help design A life they love at a low price. Starting in November 2023, we will introduce a new lower price offers on hundreds of products across our range with plans to create new exciting offers for customers in 2024” and Yes, this is also the A&M put you on the spot question.
00:25:54
I bet you could tell that was oh.
00:25:56
Dang. I can get.
00:25:57
In there again, we need some sound effects for the put you on the spot question. Like don’t put you on the spot. Question of the week, you know something.
00:26:03
Like that Again, getting back to last week’s podcast, we don’t need you to have a sound board.
00:26:07
You won’t let me do that though, but all right and here it is, and I’m glad it’s you and not me, IKEA. Is getting rid of the 5% in store discount for their loyalty program members as part of a wider effort to introduce lower price offers on new and existing items for all customers throughout the store? What do you think IKEA loyalty members will think about this announcement announcement? And additionally, as other brands retailers rethink their own retail loyalty programs, is this a script they should follow? Yes, or No2 Parter and yours.
00:26:40
As. And IKEA friends and family member, I was very, very saddened to get this e-mail in my inbox yesterday telling me that they’re getting rid of this like, perk for the plan. Like all Now you’re going to tell me that you’re going to take away my loyalty program and all I get is a lousy free cup of coffee. And then to like, come in here and also say like, we’re we’re going to just give benefits to everybody. So who cares about your loyalty?
00:27:07
We’re just going to knock down low prices across the board for every other person like. What cutting of cutting the perks of a loyalty program is never a good idea. Look at Delta Sky Miles doing it to us this year too. Like come on people like to answer A&Ms. question, no, this is not a move that other retailers should follow.
00:27:26
I think if you listen to any of the experts right now who are talking about how retailers can retain consumers, right now it’s about investing heavily in the loyalty programs. What are what are people telling consumers this holiday to focus on? Investing in loyalty programs, joining loyalty programs so that you get those discounts and the retailers get that one to one relationship with their customers. IKEA doing this does not make any sense to me. I cannot make heads or tails of this, Chris.
00:27:55
I am very upset. I I really don’t see what the benefit is going to be of removing this. Even even if it’s a hit to the bottom line of IKEA, I have to imagine it’s not going to be significant enough to cut this perk. From loyal, loyal IKEA friends and family members like myself.
00:28:14
Wow. So on a scale of 1 to 10, one being love the move, 10 being hate the move, you’re kind of A10 aren’t.
00:28:19
You. I’m an 11. I am really mad you’re.
00:28:21
Dialing up to 11 You’re spinal tapping this one I.
00:28:23
Kind of feel like talking.
00:28:25
Tapping.
00:28:26
It they don’t need it, they don’t need me to go into IKEA, but well, I’m disappointed.
00:28:31
I got to tell you and you might not like this. I kind of agree with you actually.
00:28:36
Oh God, you’re going to say you disagree with me. It was like.
00:28:40
I did some misdirection there. No, I agree with you, I think.
00:28:42
I’m going to throw a Falden Robin chair right in your face if you keep up with that.
00:28:46
Because I think you’re right. You’ve got to be insane to pull back on your loyalty perks at this point. Which tells me, and you brought this up too, it it had to have been costing them a ton. And I think. And it likely probably did as well because all of those weekend load trips that outfit your whole house trips in one go, the bread and butter of IKEA, when you get, when you stop and think about the program they rolled out, they were basically giving everyone a 5% discount on those trips just for showing up.
00:29:11
And that’s probably not a good move business strategy wise, but once you do it, it’s hard to go back. And but the other point to me that’s really interesting is now do you want to compete on price versus brand? IKEA’s a great Omni channel retailer, one of the best. So why not lean into your Omni channel capabilities? Your brand versus solely on price?
00:29:29
Price is not a place you want to be, especially in furniture, when you’re competing with Walmart, Target, wafer, Amazon, all of whom, man, this is important too, all of whom compete on price. But they also provide a wider aesthetic variety too, which is something that IKEA has to think about.
00:29:46
In this.
00:29:46
Battle So. So it seems like a really bad decision to me in the long run, especially the part about leaning in on prices. And last thing I’ll say, it reminds me of an anecdote that I’ll always remember. When I was interviewing at The Gap, Mickey Drexler had done an article for Business Week and he said the way he looks at a business is which business are most insulated against the price, the price competition. And at the time Gap was Gap had the brand right.
00:30:10
Yes, Yep.
00:30:11
IKEA is potentially going down that same Rd. Rd. of making themselves about price. They’ve always been a great price value offering, but there’s so much more the IKEA experience, and I hope they don’t lean too far into that. So that’s my cautionary tale here to the other retailers out there.
00:30:26
So you would say do not do this. To answer A&Ms. question, you’re saying no.
00:30:31
No, I don’t think I’d do it. I think I’d figure out some other way and try to keep it going for longer. A year is just not long enough.
00:30:37
Yeah, 100%. All right, let’s close it out with headline 5. Chris DoorDash is testing warnings about bad service if you don’t tip your driver. According to CNN, if you try to place an order through the DoorDash app without leaving a tip, you may get this pop up. If you’re part of a new pilot which tells you quote orders with no tip might take longer to get delivered, Are you sure you want to continue?
00:31:03
And the note then goes on to say quote. Dashers can pick and choose which orders they want to do. Orders that take longer to to be accepted by dashers tend to result in slower delivery and.
00:31:16
Chris.
00:31:17
I know, I feel like yeah man, is this a concert concept worth testing. I I’m like so baffled reading this. I still can’t believe it.
00:31:26
Yeah, you’re still on 11 from the last.
00:31:28
Headlines. I know, I know.
00:31:31
Is it a concept worth testing? No. I kind of. I kind of hinted to this in the in one of the previous stories. Absolutely not.
00:31:38
Not every test is a good test. Which is why I hate when people say and they do this all the time. Well, it’s just a test. No? By that rationale rationale, everything gets greenlit and that should never be the case.
00:31:49
And so it drives me nuts when people say that because tests will take resources, they still impact your brand. And with that said, the former merchant in me hates. Hates, hates, hates. I think that’s four hates and any marketing tactics to give my customer a reason not to buy something that’s like 101 in merchandising. So inherently it’s always a bad move and that is what you have here, plain and simple.
00:32:13
Sure, it’s going to push some people to tip, but some people are also just going to walk when they see that pop up and they’re going to go somewhere else or also just start choosing a different delivery service down the road that doesn’t make them feel that way, so. I think this is a terrible thing to test and potentially hints at some other bigger issues at play here.
00:32:32
Totally I as a as a door dash customer who regularly tips. I, yes, I was shocked to hear this and I totally agree. I mean I think people are going to start leaving the platform over this because how much is it? How much tip is enough? Like just that warning in that thing like right now, like you know here make sure you give a bigger tip like what’s the threshold like?
00:32:55
How do you know where there’s not nothing for me as a consumer that’s really going to tell me like that’s enough and my order is going to get prioritized over another one. And the second point is. Is that tip really going to make the difference in what’s able to retain a DoorDash driver? Like I question how this came up in the 1st place where the drivers asking for this update. Was this DoorDash trying to like figure out a way to compensate drivers to keep them on the platform so that it or like by giving them the ability to choose?
00:33:24
Like I think that this is really up to DoorDash to improve here and I think that it goes back to what we were talking about a couple weeks ago was shipped offering benefits to their drivers like I think that. This is up to DoorDash to make sure that their drivers are incentivized in the right way, that they’re being compensated in the right way. I I think it’s a bad move on Doordash’s part to put this in the hands of the consumer because I think a lot of people are going to just walk off the platform.
00:33:52
Yeah, now the interesting part. I would say too. Some couple caveats here too. I want to make sure that the audience hears this too. The story comes from CNN, which historically has a reputation of trying to create really salacious retail headlines.
00:34:05
So whenever you read a CNN headline audience, please be aware of that. And with that said also we we we’ve had the chance to interview DoorDash executives quite a few times. I think we both interviewed their CRO on Sage’s Shop Talk. Very smart people have nothing but respect for them. So my hunch is they’re thinking about this.
00:34:22
Very, very. They’re very conscious of this test, most likely, and trying to figure out what the best step forward is for them as well, given given how they’ve talked to us in the past about these types of things. But yes, I think you’re right.
00:34:33
And correct us. Come back. Tell me what we missed about this. Tell me how you’re thinking about it. As for DoorDash, as with any story that we ever cover on this show, I think if you have a, a point or something that we’ve missed on this, please come and tell us.
00:34:47
On its surface, though, Chris? I don’t get it.
00:34:51
Yeah, it’s a test. I wouldn’t have let go through the gates. Yeah, 100%. All right. And let’s close the show out.
00:34:55
Let’s go to the lightning round.
00:34:56
All right, Chris, question 1 amazons. Jeff Bezos has officially said goodbye to Seattle, noting that he wants to spend time with his family in Miami. What do you anticipate? Jeffy’s first exorbitant purchase will be a a bathtub of champagne from a Miami nightclub a la Sam Bankman freed B the rights to Will Smith’s Miami or CA mermaid carving of himself to place next to the Lauren Sanchez inspired one that currently adorns his yacht. Or I guess you can fill in the blank if none of those suit you, Chris.
00:35:30
Well, we know it’s not B because that’s a song, so I have no idea. I’m not going to say that one. I’m going to go with the fill in the blank option and and I’m going to go with a well stocked pantry of human growth hormone. That’s what I’m going to go with human growth hormone, which is very hard for me to say. He’s got a whole pantry full of human growth hormone supplements.
00:35:48
That’s my hunch. All right. A woman in Fort Myers, FL in a Fort Myers, FL store recently put an actual human skull. This is true story, folks. On display with a $4000.
00:35:59
Price tag? Putting all other thoughts aside and what do you think of a $4000 starting price point for a skull? I want you to put your merchandising hat on here. Is that too high? Too low?
00:36:09
Just right? What do you think?
00:36:11
This is another one of those times, Chris, where you’re going to be like, how in the hell do you know the answer to this question? Because this summer I actually went to an art fair. I found this this. Piece of art that I really wanted to buy and I learned that it was an actual pencil drawing of a human skull, which are called the correct term for human remains that are sold are called human artifacts. And given given what I have to imagine is an extremely difficult procurement process, I would say that $4000 is a fair price for a human artifact.
00:36:47
I think it’s right on the money that it seems like something that you know. Based on the complexity of acquiring that that object, I think that’s fair.
00:36:57
Wow. See, I think it’s too high. I mean, my head sits at the top, my shoulders for nothing. And so like I I just don’t get the $4000 price.
00:37:03
It’s not an artifact form yet, though, Chris, it’s not. It’s not quite there, but.
00:37:08
It’s not yet art. Yes, my my head is definitely not art.
00:37:12
All right, Chris, question 3, Doritos is debuting what it calls Doritos silent. Gamers, many of whom make up the audience who consume Doritos regularly, can now download Doritos Crunch cancellation software. And when the technology is turned on, the software detects the crunching sounds and silences it to keep the gamer’s voice intact. If not Doritos, what is the most annoying food, Chris, that you have to listen to somebody eat?
00:37:40
Wow, man. Tough one, actually. I would say it’s probably anything that someone’s eating while I’m watching a movie, while I’m dialed in on a movie, especially a movie from 70s. But more often that’s like the rustling of the bag than the chewing. I’m generally not bothered by people chewing at all.
00:37:55
Oh, I know, or bothered by my my chewing. But I’m not bothered by other people’s chewing at all, which I think is what makes it hard for me to empathize for those that are bothered by my chewing. All right, A recent report by Water Filter guru.com said that the sink faucet checked in as a germiest place in Airbnb with almost 60,000 times as much bacteria as a toilet seat. Do these findings change your hotel habit of wearing a head to toe, sleep suit to bed when we travel, or only embolden you even more, Anne?
00:38:28
Oh no. I will forever have the sleep suit head to toe. Now I just need to bring Lysol wipes to wipe off the handles of the sink. Thank you for now, inflicting this new pain and concern on me when I’m staying in hotel room. Christina Gossipson.
00:38:44
You know what?
00:38:44
I’m talking about yes, you are. You’re the shower in that suit. All right, happy birthday today to Alfie Woodard, Mary Hart, and to the woman who always gives enemies something to talk about, the great Bonnie Raitte. And remember if you can only read or listen to 1 Retail Blog. The business Make it Omni Talk, the only retail media outlet run by two former executives from a current top ten US retailer.
00:39:04
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00:39:27
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00:39:38
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