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The Omnitalk Fast Five is brought to you in association with the A&M consumer and Retail Group the A&M consumer and 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 Avalara. Avalara makes tax compliance faster, easier, more accurate, and more reliable for 30,000+ business and government customers in over 90 countries. Avalara leverages 1,200+ signed partner integrations to power tax calculations, document management, tax return filing, and tax content access. Visit avalara.com to improve your compliance journey and Mirakl , Mirakl is the global leader in platform business innovation for eCommerce. Companies like Macy’s, Nordstrom, and Kroger use Mirakl to build disruptive growth and profitability through marketplace, drop shift, and retail media. For more, visit mirakl.com, and Ownit AI, Ownit AI helps the world’s leading retailers advance their eCommerce shopping experience with AI. To learn more visit Ownit.com And finally, Ocampo Capital Ocampo Capital is a venture capital firm founded by retail executives with the aim of helping early stage consumer businesses succeed through investment and operational support. Learn more@ocampocapital.com. Hello. You are listening to Omnitalks Retail Fast five ranked in the top 10% of all podcasts globally and currently ranked in the top 100 of all business podcasts on Apple Podcasts. The retail Fast five is a podcast that we hope makes you feel a little smarter. But most importantly, especially this holiday week in the US, a little happier each week. And the Fast five is just one of the many great podcasts you can find from Omnitalk Retail’s podcast network alongside our retail daily minute, which brings you a curated selection of the most important retail headlines every morning, and our retail technology spotlight series which goes deep each week on the latest retail technology trend. Today is September 11, 2024. I’m one of your hosts, Anne Mezzenga.
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And I’m still another one of your hosts, Chris Walton.
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And we are here once again to discuss all the top headlines from the past week making waves in the world of omnichannel retailing and Chris, because every week we’re not quite sure if you’re here or not.
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We’re not sure I do your own.
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Every time we do that intro, I feel like Chris is always like, I think I’m still here.
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I think I’M still here.
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Just holding on like Wilson Phillips, holding on for one more day. But joining us today, Chris, to help and support us for the regularly scheduled monthly appearance is the Alvarez and Marcel CRG team. And we have today Managing Director Brooks Levering and Senior Director David Schneidman. Brooks, David, welcome to the program. Brooks, this is your first time on the show. What preparation did David Schneiman give you for this show?
00:03:06
Well, first of all, thank you for having me on the show. Just some shameless flattery. I love the podcast.
00:03:13
Thanks for having me.
00:03:14
Thanks.
00:03:15
Brooks did not prepare me in any way.
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Perfect. You’ll do even better then.
00:03:19
That’s great. Great. Great.
00:03:21
To the sharks.
00:03:24
Tabula rasa. Tabula rasa. And flattery will get you a second appearance. 100%.
00:03:28
For sure. For sure. But, Brooks, let’s start quick. Give the audience a quick background on you since this is your first time.
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Well, just by way of introduction, my name is Brooks Levering. I’m a managing director with A&M’s consumer and retail Group. That was a mouthful. I’ve spent the last 25 years serving clients, really across the spectrum of consumer and retail, primarily in the areas of supply chain, global sourcing and get this marketed. Yes. Also marketing.
00:04:00
Supply sourcing and marketing. Okay.
00:04:02
Yes. Full bingo card here with you. Brooks.
00:04:05
Thanks for having me on.
00:04:06
Excellent. All right, Dave, let’s go to you next. Give the audience just a refresher about you and your background and role at a.
00:04:15
Of course. Thanks you for having me. It seems like I must be doing something right that you. You could keep inviting me. Or you’re just here just to. Or I’m here just so you can make fun of me. What? But I’m happy either way.
00:04:25
Yeah.
00:04:25
I don’t know. Or A&M CRG had trouble finding someone today. I don’t.
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I’m the backup plan. You know, I’m okay with that. So, David Schneiman, senior director here at A&M’s consumer and retail Group. My background is more of a mixture of operator consultants. Spent over a decade in brand management and corporate strategy within Fortune 500 CPG companies and now been with A&M for, you know, closer to four years than three years now, which is kind of crazy. Time flies. Focus mostly primarily on consumer goods. I would say I’m the Ying to the yang of Brooks. More on the commercial side and operating model side. How do we unlock process improvements and value creation more at top line? So thank you for having me. Looking forward to this. I’m excited to, you know, be Brooks’s first time, you know, co captain here today. So looking forward to that.
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That’s amazing. We’re so excited to have you both. Chris, we are going to dive into the headlines here soon, but before we do, I believe we have a little hardware to hand out.
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We do, we do. And I’m excited to get to the show because we were, we were talking beforehand. It sounds like we’ve got some, some, some good energy and some good debate topics keyed up. So. But yes, and you are right, it is time to recognize this month’s Omnistar. Our Omnistar award for those that will remember is the award we give out each month in partnership with Corso to recognize the top omnichannel operators out there. Not the pundits, not the so called experts, but the real life retail operators making a difference in their organizations. And remember, Corso’s AI copilot coaches retail leaders to optimize store performance at every level. You can transform your retail operations from data overload into data powered. This month’s award goes to Michael Diedrich, the VP of store productivity at Tractor Supply company. According to our partners at Corso, Michael has been instrumental in shaping Tractor Supply’s renowned quote unquote legendary service in stores. His innovative approach has consistently driven new and exciting methods for coaching, fostering and celebrating a store culture that is deeply customer driven. Michael’s dedication to excellence and his forward thinking strategies have not only enhanced store performance, but also set a new standard. Michael, we here at OmniTalk on behalf of Anne, myself and our entire team, congratulations. We salute you. All right, let’s get to today’s headlines team. Today we’ve got news on Dick’s phenomenal sales performance. Walmart’s new stockx partnership, Simon Property’s new e commerce storefront aptly named Shop Simon and Walmart again this time for implementing invisible barcodes at checkout. But we begin today with news that already seems to be getting a lot of slay across social media. As in CarPlay.
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I see what you did there. I see what you did there, Chris.
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Oh yeah, I’m never obvious. I’m nothing if not obvious.
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No, I know. I think we were giving you a hard time in the post when I shot this last week. And Ted McCaffrey. Man, the two of you are just going back and forth with your dad jokes on this one. But let’s get to the headline. Headline number one, Target has integrated curbside and in store order pickup services with Apple CarPlay. According to chain storage, Target is the first retailer to Enable customers to navigate to a store for a curbside or in store pickup. Using Apple CarPlay, customers can make a drive up or package order sorry, drive up or pickup order in the Target app on their phone before starting their drive. Then once you’re in the car and connected to CarPlay, the target app will automatically display the Target store where the purchase was made directly in the car display. From there, customers can view order details, get directions and notify the store when they are on their way to pick up a purchase and when they arrive in their designated parking space for drive up orders. Target also says that it plans to make a version of this service available for Android Auto very soon. We also have a video on our Omnitalk YouTube page and on LinkedIn if you want to check out exactly how this works. But David, we’re going to go to you first here. Hotly debated topic right now is integrating curbside with Apple CarPlay a wise use of Target’s technology budget.
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So we’re, we’re a big fan of Target in the Schneiman household, particularly around curbside pickup. My, my son’s has a weird obsession with their private label fruit, dried fruit. So we go there a lot. I don’t see this as a, as a game changer. You know, while this is fantastic and I think it continues to further adopt technology, it really doesn’t have that big of an impact when you think of the consumer convenience. Ultimately it has I’m here and I’m and navigate. Well guess what, I also have Google Maps which I already know where I’m going or you already know the target that you’re probably predominantly going to anyway. So the difference is now you have a little bit more convenience factor of using CarPlay to press I’m here versus you’re actually already there. You just use your phone and just say I’m here in the space. So while I think this is further adopting technology, I don’t see this as a good use to actually drive any sort of incremental purchases. I don’t see this as driving any more incremental visits. To me this is great. I’m going to continue moving on with my day. So ultimately I think there are probably better uses of their time and their money to find something that will have more impact to their top line. But I think they already do a great job with customer service and this will help. But I don’t think this is gonna this will have marginal impact to really anything.
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So not, not needle moving in your opinion and maybe not the core focus of the budget. Brooks, where do you come in on this?
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Dave, I think I’m supposed to be the Ying to your yang, right?
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If you want to be. If you could take the path of least resistance.
00:10:42
Well, look, I think I’m going to have to agree with you on this one. I don’t think the added functionality here is going to be revolutionary. So long as I can still get my Starbucks pickup order alongside the rest of my target curbside order, I’m going to be fine. But look, I’m actually a lucky American who lives within 15 minutes of three different targets. Whoa. So the navigational help actually does help me here. So I’m in on this. I’m gonna get a thumbs up on this topic.
00:11:13
Okay. All right, Chris, I, I need to hear where you are because you and I, when this came out, we had a lot of differing of opinion on the, the value here. Give us your, give us your overview of this.
00:11:27
And I’m not sure where we settled on that either. And that argument too. And I like Brooks’s point. Like if he’s got that many targets, he needs to make sure he’s going the one with the right pickup order. So that’s interesting, but I think David said it best. It’s incremental revenue. To me, it all comes down to that. I think this, this idea, this innovation, it’s fun, it’s snazzy, it’s cool to talk about it, cocktail parties. But I think unfortunately it’s another example of what is. What has typically been illustrated in the headlines that there may be some digitally naive leadership here that likes to implement things that they understand versus invest in the things that maybe they don’t because they’re not as technically savvy. But for my money, there’s better technology spend out there. Like I think of computer vision implementations, like we talked about the Unilever freezer announcement, yet last, I think last week or the week before generative AI and search, I would all, I would prioritize all of that over this. Now, it’s not saying you can’t do all these things at the same time, but I don’t think this would even make my roadmap. And the other thing about it, honestly, CarPlay is a technology that is probably going to be disrupted in and of itself here in the future. Like for all the re, like why can’t. Why can’t I just screen mirror my iPhone? You know, in the same way, like there’s a lot of things that’s going to happen in that space too. So for all those reasons. I don’t like it. I think the headline’s silly. I don’t think it’s going to drive an incremental purchase at all.
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I think you guys are all wrong. I’m going to take really the opposite perspective. I don’t think, I actually don’t even think that. Is this the right place for Target’s technology spend is the wrong question to be asking. I think if you’re strictly looking at this as, and maybe that’s Target’s fault for like pitching this as this next innovation. I think if you’re strictly looking at this as enhancing the customer service, the customer UX for Target, this is a great move. I mean, this is giving me another option as a very busy mom. Like, I do cur, I do Target curbside pickup at least once a week and not having to pull my phone out from the time I leave my house and being able to navigate and do all this, even if I’m on a phone call, I can still fulfill my order. Like, I think it’s just, it’s looking at this as you’re just making a UX improvement to the existing order pickup functionality. I think it’s hard to say that, you know, to say that you would, I would not prioritize this over any of the things that you said, Chris. I think it’s 100% right. Like if you have a clean slate and you, and you’re, you know, putting a one bucket of money towards each of these technology investments, you know, yes, this would not be topping the list. But I think if you’re looking at improving the experience for your existing customers to keep your existing customer base, I do think that this is a positive enhancement.
00:13:56
So.
00:13:57
So, Anne, one thing with that I do, I do agree you’re improving the UX and just making it more convenient. I just don’t see this as mitigating the loss of customers. I just, you know, ultimately I’m just taking my phone out. It’ll take three seconds to say where my, what parking spot I’m in. Does it enhance? Yeah, but it’s not, it’s not something that I’ve been wildly excited about or waiting for.
00:14:24
Yeah. I guess the last question I close with you guys is like, is something that I posed online when I posted this video is like, is there anything valuable that Target can learn from this experience? Like, is there more data that they can gather from this number of consumers? Has CarPlay. This is how many people are interacting, like Brooks said, you know, like, what do we need to add to this, do I need to add Starbucks order pickup? Which I think is a great idea like that being added to this overall experience. Like what can they learn from that? And is there value in that learning? So I don’t know if anyone has an opinion. And closing on that, Chris.
00:14:57
Yeah, I thought about that too. I mean, I thought about, okay, maybe, you know, there’s also talk about advertising through CarPlay, maybe that’s an extension of the retail media network here long term. But I really doubt that’s what they’re thinking about here because there’s a lot of things and steps that have to happen there. But I don’t know. And I think you kind of talked out of both sides of your mouth, quite honestly. You said you like the idea, but then you wouldn’t prioritize it either. So like, I don’t know. Budgets, budgets are finite. You have to decide where the money goes, I guess every year. So if you’re not prioritize it, you know, I don’t know.
00:15:28
To clarify though, I think this is not, I don’t know, I guess that this is coming out of the same technology innovation budget. Like this to me feels like a UX app enhancement, not something that is being considered as part of the like overall Target budget. And this has been worked on for a long time. Like this is not something that, you know, they’re, they’re just getting, getting into right now. It’s probably been two years in the making. And is Apple contributing to this? And how much did Apple put towards, you know, this first partnership? So I think there’s more to it and I guess that’s the point that I was trying to make.
00:16:01
Yeah, right. Although, you know, when they roll it out to all the stores, that touches a lot of people and a lot of employees. So this is a, this is a big endeavor if they’re going to do it, you know, in terms of getting this. The store teams acclimated, how it works. All right, well, let’s keep on rolling. Where is my next headline? There it is. Headline number two. Dick’s Sporting Goods delivered a surprisingly strong Q2. According to retail dive, net sales at dicks were up 7.8% to $3.5 billion. And comps in the quarter were up four and a half percent, while net income increased an astounding 48% to $362 million. For those keeping score at home, Dick’s also raised its full year outlook as a result, with comps now expected to rise 2 and a half to 3 and a half percent. For the year, up from 2 to 3% previously. It should also be noted for further impact that Dick’s recent Q2 sales were also up almost 54% over 2019. I think that’s good. All. I think that. I think that’s good. I think that qualifies as pretty good. All right, Brooks, what is Dick’s doing, right? Or is it just riding the wave of multiple trends converging at the same time? What is your opinion here?
00:17:14
Well, look, Chris, I’m a big fan of Dicks. Like Dave said earlier, full transparency. I’ve got two teenagers in the house. We’ve got nonstop sports. So I love what Dix is doing. I think the assortment. You asked what’s special about Dix? I think the assortment is amazing. Maybe not every category, but all the ones that sell. I love what they’re doing right merchandise at the right, right time. That used to seem impossible in the sports and outdoor business.
00:17:46
Right.
00:17:48
I love the way that they’re connecting Omnichannel experience end to end. I don’t know what their store pickup percentage would be for E Commerce, but I would guess that it’s one of the highest in the industry. They do it so well. My son Shingar breaks in the morning, you need another one, you punch it in, you pick it up. It’s right up front. I’d love the experience connecting Omnichannel end to end. And then I love the double down on experiential. I mean, that’s a big trend. But I think Dix is ahead of the curve here. I mean, we’ll see how it all plays out. This is a big investment. When you talk about the house of Sports format, by the way, I’m still waiting for my first house, House of Sports format store here in New Jersey. But I like the idea of rock climbing walls, indoor tracks. This is a big capital investment, but I see it paying off. So you.
00:18:47
So net net. You think it’s more about the execution and the strategy of Dix than the capitalization on the capitalizing on the trends in the. In the sporting goods space?
00:18:57
Well, I would say yes. On balance, I think on the flip side, look, you got to give credit to some of the brands that are just on fire right now. Think about Hoka. That’s a $2 billion brand right now. This is a brand that’s on fire on getting back to athletic performance. So it’s not everything that Dick’s is doing. And look, this is an industry. Sporting goods. It’s still extremely fragmented, a little bit sleepy. Other than maybe Amazon and rei. So it’s easier to grow and take share than in other categories here for Dicks.
00:19:34
Yeah. It’s funny, it reminds me of an anecdote my. One of my old mentors at Target used to tell me. He used to. Used to be the buyer for sporting goods. He said he never saw more chest hair from the salespeople in sporting goods than anywhere else in the world. So, yeah, let that sink in, Omnitalk fans. All right, and on that note, what’s your take? I have a feeling.
00:19:52
I love that I’m the segue for chest hair. That’s where it’s like, let me see. Slimy salespeople with lots of chest hair. Let’s go to Ann.
00:20:01
Why not? You know, I try, I try, but I have a feeling your take, similar to Brooks, is it.
00:20:05
Yeah, I mean, I think, look, there’s a couple of things that you’re doubling down on here that doesn’t get talked about as much in the headlines, and that is also the investment in community. I think Dick’s as a giant retailer, a national retailer, really doubles down on making sure that they’re offering opportunities for the community to get special discounting when it’s time. You know, they partner with all the local community sports leagues to give special discounting, like, ahead of the seasons. They do. Did you know that fun fact for those listening at House of Sports, you can drop your kids off for parents night out for $20 and leave your kids there to do whatever. Like, they get to play in the dome here. They get to do whatever they want, like batting practice. You name it. You just drop your kids off there for $20. And I think whether or not the parents are spending time during that ind, which there’s a lot to look at for me as a mom. Like, they’ve got right price, right design product for me, for my husband. And I think when you look at more time spent on site, what Brooks was saying, too, more time spent on site means higher sales. And I think that community element, the. The experiential element is what really is setting dicks apart and providing these kinds of numbers for their Q2.
00:21:14
So there’s more room to grow here from you. For you.
00:21:17
Yes.
00:21:17
All right, Dave, what do you think? Are you going to throw the contrarian point of view here?
00:21:21
No, I’m all in.
00:21:23
Unfortunately.
00:21:24
I wanted to disagree with Brooks, but I couldn’t agree more. I think there’s a number. There’s a lot of reasons why dips is performing well. I think one is their Marketing as a whole, you don’t see many retailers within the sporting goods space really trying to double down on awareness and consideration and actually driving people into the store. So I think they’ve done a really good job. You know them, you see the Gatorades, the Nikes of the world, but they’re the only brick and mortar that’s really trying to win in this space. I think that’s one. Number two, this is completely. I have no data to. To validate this, but I think sports in general are somewhat recession proof, especially when it comes to kids. Soccer will always be around. Little league will always be around. High school. Sports will always be around. You will always need shin guard, you will always need soccer balls, you always need cleats. So I think that is an interesting play. Three is their private label is on fire. Yeah, I think they’ve done a really good job with their assortment, but I think they’ve. They’ve done a really unique way of actually leveraging their own private label to specific customers and specific categories. Their UX and app, I think, to Brooks’s point, is great. I love that I can actually see the inventory of specific products at my local dicks. And I actually think what’s unique about what they have versus it’s accurate.
00:22:47
Yeah, right.
00:22:48
What a concept.
00:22:49
When they say there’s 10, they’re like, well, it might be nine, it might be 11, but it’s not out of stock. And something that’s out of stock isn’t that. I think they actually do a really good job. And ultimately this concept of athleisure is still on fire right now.
00:23:04
Yes.
00:23:05
So they. There’s, you know, fashion has been. Fashion today is very different than fashion ten years ago. High fashion doesn’t really exist. And so you. A lot of people still wearing their sweatpants to a bar or something like that. Nike sweat. So I just think it’s on trend with their overall assortment, and I think they’re doing a great job and they’re taking advantage of all of these macroeconomic trends and these, you know, consumer trends right now.
00:23:30
Yeah. Yes. Okay. So I’m gonna. I’m gonna. I’m gonna. I’m gonna. I’m gonna slow the roll a little bit on this one. On my opinion, I don’t think I disagree, but I think I do. I. There’s some caution here I’d put to this headline. You know, I think, like, with everything, there’s always a balance of both. Like, it’s usually somewhere in the middle right when everything settles out, you know, the, the whole, the whole sporting goods is a recession proof trend, especially coming out of a pandemic. That’s another thing that’s been going on here too. And we like the teams addict. They are good stuff. We like them a lot. And so, and to get great execution like this or get great numbers like this, excuse me, it of course takes great execution. But I think you have to, you have to go back to what Han Solo told Luke the first time he blew up a TIE fighter. You can’t get cocky. And I’ve seen retailers do this a lot where they think they start, you know, drinking their own Kool Aid and thinking they’re really great. But there’s a ton of tailwind that’s helping this brand. And so at some point the comps are going to get difficult and it just depends on when that is. But I think they’re execution wise set up for that because the one thing that does concern me is there’s a lot of talk about the house of Sport being this next great strategy for them. But if you really think about the numbers and the impact that’s having, it’s probably likely very small because there’s only 15 of them and they have almost a thousand stores. So to be that’s getting overleveraged in the media as the growth engine for Dick’s going forward. So I just would caution everybody here and say, hey, keep your nose to the grindstone everyone at Dick’s. You’re doing a great job and keep it, keep it going as best you can.
00:24:55
Let’s go on to headline number three, Chris. Walmart is betting on collectible sneakers to grow its marketplace. According to Bloomberg, Walmart is teaming up with sneaker marketplace Stockx to offer dozens of pre verified shoes ranging from Nike Inks, Air Jordans and collaborations with Travis Scott to those from New Balance Athletics and Asics. Hundreds of items will be available on Walmart’s website starting next week and Stockx will fulfill and verify the products. The partnership could expand to tens of thousands of products, Michael Moser, vice president and category lead at Walmart Marketplace, said in a recent interview. For StockX, this marks its first third party platform deal, a deal Stockx hopes will help it reach a new consumer base, including customers who may be unfamiliar with the brand. David, we’re going to go to you first. Interpret this how you want but are you buying or selling? High end nike kicks on walmart.com I am cautiously optimistic. Are you? Let’s talk more.
00:25:52
I’m not buying yet. I’m going to Wait to see a little bit. But, but, but I’m intrigued here.
00:25:56
What’s making you cautious about the optimism?
00:25:59
Well, I’d like to understand better around their overlapping of consumers or lack there of overlap. And so you know, Walmart has scale and a great marketplace. StockX has a really good brand, but probably can use help when it comes to traffic or even awareness. And so what I would love to see is, is this an overlapping consumer where then all of a sudden we’re going to start driving more and more sales and awareness to the StockX platform. And then all of a sudden now Walmart’s going to be driving more and more loyalty along with incremental sales and incremental revenue. So I think there’s something intriguing about this, about this partnership. I’d love to, just as a consumer junkie, I would love to learn more about the data behind it in terms of the consumer overlapping, the demographics, what the expectation will be. But I think this is a really intriguing partnership that might have actual legs if, if done correctly and if they’re targeting the right consumer. So I’m, I’m looking forward to seeing more to see how successful this is and how much this will roll out. I’m not against it. I think this could be a really cool pilot.
00:27:16
Dave, are you a sneaker head? I have to ask you this question. Like, would you consider yourself mildly interested in sneakers?
00:27:23
I would say I’m not a sneaker head. Do I, do I like sneakers? Yes, but you know, I, I, I, I other places. But I do have a couple of, like I have a couple pairs of Jordans.
00:27:33
Okay, okay. All right.
00:27:36
I think I’d say okay with the Kendrick Lamar Nikes. So.
00:27:39
Oh my God. Oh wow.
00:27:41
All right, sneaker head.
00:27:43
Okay, 11 yeezys yet I don’t think Travis Scott’s. I have a couple of just, you know, low.
00:27:49
But you’re interested, you’re interested. You may find yourself searching for Travis Scott Lowe’s at some point in time.
00:27:58
A number of times, even though they have, they have not just passion forward ones like the real trending ones. They even have historical running sneakers that you can’t get anywhere else. And so I think there’s something intriguing about this. Looking forward to see this.
00:28:14
You’re, you’re flowing right into my trap, Dave. I think this is the question. Chris has got a comment here too, but I think this is where I really think that there is momentum here. Like if you’re going to search for any of these products, Walmart is not a place that you’re going to be going and now searching any of those things. Walmart will now show up and probably show up very clearly now as one of the first options for you to get that product at an affordable price. But Chris, you, I know you’re nailed it, a huge fan of this but like tell me about your perspective on this one.
00:28:46
You nailed it and I went on the experience yesterday and Dave, you should try it out because you, if you’re on StockX, you’re going to like it. It’s pretty easy to use and pretty, pretty cool what popped up. But and I mean I’m all in on this. I freaking love this. I think it’s just another example of Walmart killing it. And there’s three reasons I would give for why I like it. Number one, Walmart should never have gotten this deal. I mean when you think about it Target and Dick should have all been ahead of them with StockX but somehow Walmart got this which so kudos to them. Secondly Dave, I think your point’s a moot point because it’s a marketplace, either sell it or you don’t. And it’s a search game and so Walmart gets the search traffic too by based on who who Walmart is. So that’s going to happen. So the customer overlap question isn’t as big of an issue here. It’s all just additive incremental revenue. But third, the best thing I love about this, it’s another example of Walmart moving up market via digital, not necessarily in stores but via digital. And that is why it has been stealing share from places like Walmart which publicly it’s been saying it’s been doing. It’s been getting a higher income demographic and it’s Marketplace and Walmart.
00:29:49
Target you mean?
00:29:50
Yeah, sorry, Target, yes sorry, thank you for clarifying that. And the reason for that is it’s Marketplace and Walmart plus are more appealing as a general offering than what others particularly Target again are doing digitally. And so kudos to Walmart there. This is an absolutely brilliant move. It’s a stroke of genius that plays in to where they’re differentiating themselves.
00:30:13
Yeah and you add in like you layer in the pop ups that they were doing with their scoop brand for New York Fashion Week last week. Like all of these people who never would have gone to Walmart in the first place are going to start searching for these products and they’re going to find themselves on a Walmart for the first time ever. Total chess move against Target.
00:30:31
And that’s the unlock here I think Ann is that, I thought about this last night. Digital is what’s enabling them to extend their demographic and that’s the key point here.
00:30:41
Yeah, that’s the real growth channel for.
00:30:42
So I agree with you. I think from a Walmart perspective this is genius. From a StockX, their brand is very important to them. So clearly this is the first time they’re dipping their toe into this. And so to your point, was Walmart the right move? Should have gone with, with Dick’s, should it have gone with Target? And I think that’s where I’m not sure if StockX is all in yet.
00:31:07
Maybe.
00:31:07
And so maybe Walmart, if I was Walmart, I’d be like, yes, give me everything I could possibly handle.
00:31:12
Right.
00:31:12
I’m still intrigued to see where it’s going to go. It depends on what lens you’re looking at.
00:31:17
Yeah. And is there an acquisition play here in the long run too? You know, I don’t know.
00:31:21
Right. Yeah, I think that’s a great point. And to me, David, like Dick, seems like it would be the next. That seems like it would have been the right spot for sure, but just because of the category that they’re already carrying. But Brooks, we’re going to give you the last word here. Close this out.
00:31:34
Hey, when it comes to Walmart, market, marketplace, I’m 100% in. I think my only concern as a seller knowing Walmart would just be pricing control. But honestly, Amazon, Marketplace, you’ve got the same issue for this kind of high end item. But look, I love it. This is no longer primarily approving ground for products before they make it into the physical stores. This is separate, this is marketplace. This is the growth engine for Walmart. Love it.
00:32:03
Yeah.
00:32:03
And the great thing about marketplaces, the sellers control the price. Walmart does not get involved in setting the price right, so, so that’s key too. All right, headline number four, Simon, the real estate investment trust has engaged that typically engages in the ownership of premier shopping, dining, entertainment and mixed use destinations, has launched Shop Simon the quote, next phase in its journey to create the ultimate omnichannel shopping experience. End quote. And man, I just read that and I got so excited. According to Simon’s press release, Shop Simon, available@shopsimon.com and via the Shop Simon app offers a comprehensive single source of premium and luxury sale price products from more than360 retailers including Adidas, American Eagle, Cole Han and more. Shop Simon builds upon the success of Shop Premium outlets and now the expanded and rebranded digital marketplace will be adding on sale and discounted merchandise while continuing to offer outlet products from leading brands. With Shop Simon, shoppers can easily search by image or color, view similar item recommendations from their search and experience hyper personalization to guide them through thousands of choices to land on the perfect product. I tried out yesterday, it’s pretty slick. In the future, Shop Simon will utilize Simon’s nationwide network of shopping destinations and retailers to seamlessly merge the best of online and in person shopping to get consumers what they want at the right time, including, and this is key, same day pickup and at a great price. All right, let’s go to the gingham shadow here. Dave, will Shop Simon become the standard by which American mall goers shop their malls online?
00:33:47
So I love this. I think you kind of alluded to that. I think this is the next evolution of that omnichannel approach since they are really winning in brick and mortar and the way in which the marketplace exists. I also went on it yesterday and the UX is great, the personalization is great. I think the brands they have there really will work together. The only thing I’m worried about is I never, I’ve never been to shops, I’ve never been to Simon.com or I’ve never leveraged their app. And so do they have the credibility, which I believe they do, to be this marketplace? But when they, I was reading they’ve done a hundred million annual website visits, I didn’t even to me I was like, really? That, that was extremely surprising to me. So maybe they do have those underlying, the underlying activity to validate this. But to me that’s the only big piece is how do you become a premier destination in the consumer’s eyes from a digital aspect. But this is the next step for them and I think this makes total sense. And creating that omnichannel approach, the market, the marketplace approach totally makes sense. So I’m all in on this.
00:34:57
Yeah, yeah. No, I love it. I love it too. And I think your point about the customer acclimation is definitely the key point. Right. But yeah, when you read the numbers, you’re like, oh my God, that many people like are checking out what’s at their local mall. Yeah, right. And so there’s a couple reasons. I like that too. Like for me it extends the reach of retail media. Like if they’re getting a hundred million visits, this just adds to that. And second of all, like when you think about where this goes, if they enable curbside pickup too. Right, Dave? Like then it enables you to shop the mall differently. Like you can coordinate your entire experience before you get there, which should drive even more traffic to a destination like, like Shop Simon, which is great. And so the other reason I love this just self servingly and you’ll remember this is I wrote an article back in Forbes in 2019 outlining the three steps that it would take to reinvigorate the malls. And basically Simon has now done two of those. The third one is co op fulfillment, which maybe we’ll see at some time. But kudos to them for following the blueprint and the roadmap to reinvigorating the mall. I love this idea. What do you think, Anne? Yeah, go ahead Dave. Yeah, back to you.
00:36:00
Well, I was just going to say I think as a brand I love this also because it’s unique and incremental points of distribution to your consumer and so it’s more touch points. So now yes, I’m competing a little bit more with my competitors as it relates to this marketplace, but it also could potentially drive incremental sales and in more of an organic, spontaneous manner. So I think that’s great. And if as a brand I’d be all in on this as well. And you’re creating that more of that omnichannel approach.
00:36:30
Yeah. And it’s interesting too that they’re starting off with sale priced items too that they hit that in the press release too, which makes me think they’re using this help to help clear through the inventory that many of these brands and malls need to clear through. But Anne, what do you think?
00:36:43
Yeah, I mean I, I don’t know that I have much to add. I think it’s kind of a no duh that like a mall should have the best digital marketplace available for the brands that are inside their walls. Like it helps with leasing.
00:36:53
Well said.
00:36:53
It helps with other, you know, traffic drivers to the mall online and offline. Everybody wins. I think it’s just going to come down to, you know, what we were talking about earlier and that’s getting traffic to shopsimon.com like how are they doing? How are they getting that taken care of to like make that the destination that I’m searching for. But I also, I have to commend them. Like if you look at it, one of the things that I think is really important is looking under the hood and they are, you can upload images and search. So they, they have invested heavily in things I imagine like computer vision to make sure that, you know, when I upload a photo or if I’m looking for something or that they’re using that kind of thing to really be able to scrape so that if I search for something, I’m getting good results back because it’s only this, this app, this shopping experience is only as good as the search results that are returned. And I think that it looks like they’ve invested pretty heavily in making sure that I’m going to have a quality experience as a consumer. So yeah, I think it’s great. I think it makes sense.
00:37:51
Yeah, the no dog comment and what you said after that just totally nailed this, you know, in my mind too. Brooks, what’s your thoughts? You got any other insights or wrinkles you’d add to this conversation?
00:38:01
Well, I’m just going to echo the no dog comment. Look, I’m from New Jersey, so I love everything malls and I love the vision for the outlet channel here. I mean that was begging for more online sell through. So no duh.
00:38:18
No duh. Way to go, Simon. You’re. You got the no duh seal of approval.
00:38:22
I’m glad that that’s, that’s what’s going to resonate from this podcast. All right, well, let’s move on to headline number five. Walmart has implemented invisible barcodes at self checkout. According to the street.com In a recent TikTok video, which has amassed over 200 views, a Walmart customer showed herself scanning great value items through a self checkout machine at Walmart without using a barcode. The TikTok Creators Discovery comes after Walmart partnered with Digimar, the company that’s behind the new feature, to innovate its barcodes for $3 million a year. In 2022, Walmart expanded its partnership with the tech company in order to help, quote, help further optimize store operations, end quote. According to Digimar’s website, the technology involves embedding codes that are, quote, invisible to the human eye, end quote. Unquot product packaging, which makes it easier to be detected at self checkout machines. Brooks, we’re going to you for this one. How should Walmart ultimately judge the success of these invisible barcodes?
00:39:22
Look, I think this is a great question and the answer is shrink, shrink and shrink. I mean I love this move. Yeah, if you’re in retail, you know, shrink is a massive $130 billion problem this year. And self checkout, think about it, it’s a major driver of that recent increase in shrink. Something like 3 to 4% shrink on self checkout lines is what we’re seeing in our grocery work. So that’s just orders of magnitude bigger than the cashier lines. But I would say, and I think hopefully Dave agrees with me, I mean invisible barcoding isn’t going to be the silver bullet here because shoplifting, that’s the biggest driver of shrink, particularly on self checkout. It’s not scanning errors. And I would just say the easier you make self checkout, the more you’re diverting customers from those cashier lids.
00:40:24
Yeah.
00:40:25
So I think solving shrink still comes down to operational excellence. This is going to help, but I don’t think it moves the needle as much as Walmart needs it to here.
00:40:35
In the short term, would you recommend that other retailers be considering this? I mean the $3 million investment to do this that Walmart’s looking at, like what are your thoughts there? Is it something that you’d still say go for because it’ll, it’ll kind of attack some of that shrink number that you were talking about or is this something you’d hold on?
00:40:52
Well, well no, I think it’s a go for it at this point. I mean the shrink has become such a major issue across retail, particularly in self checkout. I think it’s got to be one of the things that you put in place. And so I’m thumbs up. I agree with the move. I think there’s other ways that you’re going to be able to reduce shrink, but I think this is going to help. Look, I mean RF tags, nothing’s the silver bullet here.
00:41:24
Right.
00:41:24
Employee training by the way, putting some staff back into the self checkout areas. I mean that, that’s a thought. I mean this is a big enough problem that we’ve got to take it from multiple angles.
00:41:38
Yeah. I was just at the Total Retail Technology Conference and we had three retailers on stage, Bells, Busy Beaver Building Supplies, which I was not familiar with until this, this week. Yes, everybody knows PBBS and ipsy and it’s fascinating like to your point Brooks, like they are investing in everything from like badger shelf scanning robots, like blinking and honking at people in the aisles or as they’re getting ready to try to deter from theft all the way down to you know, self checkouts that you can, you know, simultaneously turn on and off to have be cashier manned or to be, you know, self checkout machines. Everybody’s attacking the problem at this point and I think you’re right. It makes sense to kind of invest in, in barcodes as another proof point. But it goes back to I think what John Clear, one of your colleagues said in a insightful minutes not too long ago. It also is about the operational Investments that you’re making to make sure that the internal issues that are causing some of the shrink to show up or theft to show up are remedied too. But Dave, I’m curious what your thoughts are here, what you’d add in.
00:42:40
I, I agree with Brooks. I think the one thing that I want to double down on that he mentioned was this will help with scanning challenges. I believe my, my hypothesis is that the shrink is not due to scanning challenges. It’s because I put a candy bar in my pocket and I do it on purpose. So. Or they just forget. So you have some sort of customer service rep that’s helping. Usually with the scanning challenges, the weight’s not right. I think asset protection only goes so far when you’re actually doing it at the exit and not at the self checkout. So I think there’s actually a disconnect in terms of where you have asset protection, which could mitigate some of this. But you’re not going to stare at a receipt that has three things and you see three strings in your, in your hands, there might be a fourth in your pocket. And so I think the way in which you actually rethink where the issue is, I think you can actually come up with more innovative or even simpler solutions to mitigate this.
00:43:51
Okay, Chris, close us out here. What are your thoughts?
00:43:55
I mean, I think we have to set some language here too. I think there’s unintentional shrink and there’s intentional shrink. This is designed to curb unintentional shrink, which is like I just unwittingly forgot, didn’t realize I didn’t scan my item and I put it in my bag. And that is an issue. And we’ve seen the videos from grocers where that is happening, where people that are ethical just make mistakes. And so that will on the margins help things. And if the $3 million cost is what’s at stake here, that’s a drop in the bucket. I mean that’s like two executives annual bonuses. You know, potentially if the, if the, if the company’s doing well. So. And then I also think the other reason I like this technology.
00:44:36
Yeah.
00:44:37
Is it goes beyond shrink. Like for example, there are many other use cases I would be using to evaluate its success. Like it should actually make your scans at the traditional checklanes by your, by your cashiers more efficient and faster. It should help you to replace abandoned at the end of the night because you can scan the products wherever. You know, you don’t have to find the barcode that should Speed things up. It should speed up return processing. It should help you identify each is in the back room more efficiently as well. So the answer to those questions should be yes to all of that. And so for me, that’s the mark of a good innovation that has a lot of scale in use cases throughout the operation. So that’s my take here. This goes well beyond shrink in my opinion, but it is unintentional shrink. What it’s designed to help.
00:45:23
Yeah. Bargain basement. Really, $3 million to do all speed up all those processes seems like a no brainer.
00:45:30
Yeah, it makes me wonder if that number is actually correct, you know, when you get right down to it. And, and the fact that the CPGs have to put this packaging on their products too. So there’s some element of that too that has to come into play.
00:45:40
Right. All right, let’s go to the lightning round, everyone. Brooks, you get the first question because you’re a first timer. Amazon just announced the largest just walk out technology expansion yet, which will go out to even more stadiums and colleges. I want to know what was the last thing you purchased from a just walk out location and did you find that it made your mission simpler?
00:46:03
Well, look, I’ve been on a diet for a long time here, but I’m going to say lay’s potato chips, sour cream and onion and yes, yes, and yes. Love it.
00:46:13
Yeah. Where were you, where were you when you bought those? Airport Stadium.
00:46:19
At. At a close. At a stadium here in New Jersey. And it makes it a minor league stadium in New Jersey. It makes it very easy.
00:46:29
Excellent. Excellent.
00:46:30
Awesome. Awesome. All right, Brooks, back to you then. Rolling Stone. And this one we can open up to everyone because, you know, I just love television, so. I used to love television. Rolling Stone just released its rankings of the 100 greatest TV episodes of all time. Brooks, what would top your list?
00:46:48
Well, this might show my age, but I’m definitely going to say Seinfeld.
00:46:52
Yes.
00:46:53
And I’m going to go with who told you to put on the balm? Jackie Chile’s best episode in Seinfeld, bar none.
00:47:01
Wow. Okay. I thought you’d go to the contest. That’s mine, Dave, what’s yours? Just out of curiosity.
00:47:06
That was the second loss.
00:47:09
There is that episode where the numbers came out. Numbers I like. I remember that. Where my mind was blown. I’m still frustrated that the numbers didn’t really manifest into anything. But for six years, it was what I would always play on any sort of bingo or any sort of lottery numbers. Always the same numbers. So Lost. Easily lost.
00:47:32
Had the habit of doing that, didn’t they? And what’s yours?
00:47:35
Mine’s not funny. But I have to say that the Bear, the Christmas episode of the bear was one of the most impactful pieces of film I’ve ever seen. I think it was very. I just have never felt something and been so invested in a show as that episode. I think it’s really one of the best acted episodes in TV history.
00:47:59
Jamie Lee Curtis in that episode.
00:48:01
I know, right? Just crazy.
00:48:03
Everyone seen that show yet? I need to watch. I need to get that into rotation. I’ve been going back and watching Family Ties, which is. God, there’s a lot of episodes of Family Ties.
00:48:11
Oh my God. You need to get into the bear immediately.
00:48:13
I know, right? Abort. Abort.
00:48:16
Yes. What’s yours though? You’re the real, like, film.
00:48:18
Oh, mine’s a contest. Yeah, for sure. It’s 100. The contest. Which. Which sadly was ranked number four. You know what number one was? Was?
00:48:24
What was?
00:48:24
Amandias from Breaking Bad, which.
00:48:28
I don’t know what episode was that? I don’t even.
00:48:31
That’s the one where they kill his brother in law in the desert. You know, that whole where basically everything goes to hell and he becomes, you know, the guy he becomes.
00:48:41
Oh, man. All right, I think I’ll have to go back into the archives for that one. We’re gonna move on to question number three. All right, Dave, it’s your turn. Lululemon announced they’re expanding membership perks to include the discounts of Sweet Green and Berries to your membership. Given what some listeners might remember your love of the former Sweet Green, are you more or less motivated to join the Lululemon program? Question number 1A and 1B. What if they gave you double chicken for free? Double chicken. Dave, what’s your answer?
00:49:16
No. And then yes. So.
00:49:18
Really for Double Chicken?
00:49:20
Yeah, I’ll do anything for double chicken.
00:49:23
Quote of the show. Quote of the show.
00:49:25
It’s But.
00:49:26
But.
00:49:26
But. As it helps with just additional rewards. No, it’s the same thing like airlines. You can connect with Uber or Lyft. Will I connect it? I think that’ll help with maybe some data and some synergies, but it’s not going to actually impact. Wow, my behaviors.
00:49:42
Even though it’s free? Even though it’s time to join. Yeah. Wow, that’s free.
00:49:46
I’ll add it.
00:49:46
But I. I mean, but I. I don’t. I don’t shop enough at Lulu.
00:49:51
Where.
00:49:51
Where I think it’s that. It’s that Mind blowing.
00:49:55
Not a compelling ad for you?
00:49:57
No.
00:49:57
Wow. All right, well, this might be compelling for you, Dave, because Barney the Dinosaur is getting relaunched as a new animated Max series. I checked your timeline on LinkedIn. I’m pretty sure you’re a millennial, so does that mean you were a Barney the Dinosaur fan growing up as a kid? And be honest with our listeners, we always prefer candid commentary and frankness. Dave.
00:50:21
So I’m what I would call an older millennial or an, oh, so an analog childhood and then a digital adulthood. We had Barney in the house. In the house, but it was for my younger sister. I was a little bit older. I was more of a Ninja Turtles guy. And then a Saved by the Bell. I watched. I watched Saved by the Bell at a very young age. So no, no interest. I think nostalgia’s in. So there might be someone that wants it back. And, you know, you know, with a younger child with it, with two young kids, I. I like that nostalgia.
00:50:58
And.
00:50:59
And so you’re seeing that with Disney, in particular with. With Marvel. And then Ninja Turtles is back. So I like it. But no, not in the Schneidman household. That will not be watched.
00:51:10
And I got a question for you. We’ve had a lot of millennials on the show. It feels like everyone tries to disown being a millennial. Do you think, like the younger millennials, like Carter, do they embrace it? Or like Carter Jensen, a general. Do they embrace it or do they try to disown it too? What’s your take on that real quick?
00:51:24
I think it’s the Xennials. I think we don’t want to be associated with the millennials and their neediness. We want to be more independent and like our own people. So I. I don’t know. I think it’s just this, like, you know, the people right on the cusp.
00:51:38
Like the 4 to 5 year cusp, they don’t. They don’t embrace it. I think the name is just such a moniker too, you know, versus, like Generation X. But anyway, I love you, you love me. Happy birthday today to Amy Madigan, Brian De Palma, and that little darling, Christy McNichol. And remember, if you can only read or listen to one retail blog in the business, make it Omnitalk, the only retail media outlet run by two former executives from current top 10 US retailer. Our Fast Five podcast is the quickest, fastest rundown of all the week’s top news. And our daily newsletter, the Retail Daily Minute, tells you all you need to know each day to stay on top of your game as a retail executive and also regularly features special content that is exclusive to us and that Anne and I take a lot of pride in doing just for you. 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. You can follow us today by simply going to YouTube.com omnitalk retail. Dave, people want to get in touch with the A M Consumer and Retail Group after listening to this fabulous conversation. What is the best way for them to do that?
00:52:43
I think there’s two ways. One is we have a dedicated website. It is alvarezamarsal-crg.com we are actively monitoring, monitoring our submissions. So that would be one in our contact forms. Number two is our LinkedIn. We’re actively monitoring that. So feel free to reach out at any time on our LinkedIn. It’s Alvarez Marsal, Consumer and Retail Group as our account name and hopefully people reach out. We’d love to respond and converse with you. So thank you.
00:53:14
Wonderful.
00:53:15
Well, Brooks, David, thanks so much for being here. Thanks. Joining the ranks of the Unshaven today, two, three unshaven lads here with Anne for this podcast and on behalf of both of them, Anne, myself and all of us at Omnitalk Retail, as always, be careful out there.
Omni Talk® is the retail blog for retailers, written by retailers. Chris Walton founded Omni Talk® in 2017 and have quickly turned it into one of the fastest growing blogs in retail.