Fast Five | Walmart’s Rewards Program, WhatsApp Grocery Shopping, & Instacart Goes Big & Bulky Prior Its IPO
Anne Mezzenga: Hello, everyone. We are live doing the Fast Five live-
Chris Walton: Fast Five live.
Anne Mezzenga: From Home Delivery World.
Chris Walton: Yes.
Anne Mezzenga: You are listening to the Fast Five that is still today, even at the trade show, brought to you in partnership with Microsoft, the A& M consumer and retail group take off and sizzle.
Chris Walton: That's right.
Anne Mezzenga: As you know and love, the Omni Talk Fast Five podcast is the podcast that we hope makes you feel a little smarter, but most importantly, a little happier each week, me and Chris-
Chris Walton: Yes, it does. Even from Philadelphia.
Anne Mezzenga: Today, it's the... oh, this is-
Chris Walton: I know, right?
Anne Mezzenga: It's the first of the month. Wake up, wake up, wake up. It's the first of the month.
Chris Walton: Totally off the beat, probably.
Anne Mezzenga: It is September 1st, 2022. I'm your host, Anne Mezzenga.
Chris Walton: And I'm Chris Walton.
Anne Mezzenga: And we are live from Home Delivery World in Philadelphia. And here once again to discuss all the top headlines, making ways in the world of omnichannel and perhaps big and bulky delivery.
Chris Walton: That's right. Yes, as you can see in the background, as we've talked about incessantly for the past week, we are at Home Delivery World. It's the last day of the show and we're ready to go. We're here, we're live for you, our audience. Thank you so much for tuning in. To anyone that's watching live as well as to anyone that happens to listen to the podcast recording after the fact. But Anne, what you thinking of the show, real quick?
Anne Mezzenga: Oh man.
Chris Walton: Quick take. Hot take, hot take, Anne. Hot take. Hot, hot, hot, hot.
Anne Mezzenga: Well, I would say the show has been a little hectic.
Chris Walton: Yeah, it does. Lots going on.
Anne Mezzenga: Like there's so much going on. There's so much to see. But I've had some really good takeaways, some really good revelations. I think some acceptance overall of maybe the way that I think we should be delivered-
Chris Walton: Broadening our minds. Yep.
Anne Mezzenga: Are not the only ways. There are other ways to experiment. We talked to Drone Up yesterday.
Chris Walton: Drone Up, yeah, it was good.
Anne Mezzenga: Being a prime case for listeners of the show, they'll realize.
Chris Walton: Yeah, yeah. I walked a tight rope on that one too, in that conversation.
Anne Mezzenga: You did, you did.
Chris Walton: The little Omni Talk fans will pick up my subtle cues that I was dropping throughout the course of that interview. But yeah, let's get to the show, Anne. No reviews to read this week, because we're out at the show. But please do leave us a review if you get a second. Tell us how much you like or even also important, even dislike the show. If you're happen to be listening and you're like," I hated that episode. I don't agree with you at all." Let us know. Just rant incessantly on Apple Podcast, wherever you want to leave us a review.
Anne Mezzenga: Yes. Hi, Cammy. It's great to have you on. Since this is a live show, you could also leave a comment in the comment section and tell us what you think.
Chris Walton: Yeah, that's right.
Anne Mezzenga: We'll be taking those too throughout the show. But if you are listening to this after the fact, do leave a review on Apple Podcast, heart the podcast if you're on Spotify or Google, Amazon Music, et cetera. We really appreciate you taking the time to do that because we will read it one day for all the listeners to hear. And it helps us bring you the most amazing retail content possible
Chris Walton: And helps us keep moving up those ranks, Anne. Helps us keep moving up those ranks and bringing that content to you. And every difference makes a difference is we always say.
Anne Mezzenga: Oh my gosh.
Chris Walton: All right, shall we do the show?
Anne Mezzenga: We are definitely being a telethon show at this point.
Chris Walton: Should we do this show? I know it feels so different because we've got people flying by behind us. Some people get really close. Yesterday, actually we had Ben Franklin show up. Like legitimately a dude in a Ben Franklin costume.
Anne Mezzenga: And the Grinch.
Chris Walton: Yeah, that was so random.
Anne Mezzenga: Franklin makes sense, we're in Philly. But the Grinch, where was that coming from?
Chris Walton: Yeah, the Ben Franklin I think was associated with the show. The Grinch, I'm not so sure. But today's Fast Five is brought to you with the help and support of our good friends at Grocery Shop. Are you a retailer or brand thinking about attending grocery shop this year? Well, don't even think about it without using our promo codes specifically for Omni Talk listeners. Just go to groceryshop. com and enter pro promo code RBOT1950, my favorite promo code of all time. That's RBOT1950 for your special discounted rate. All right. Today we've got headlines from Bloomingdale's opening a second store under its new Bloomie's banner. Instacart's launch of a new, what it's calling, big and bulky product delivery service.
Anne Mezzenga: The theme of Home Delivery World. That's for sure.
Chris Walton: After moderating a panel on that very topic yesterday. Meta and Jio teaming up to launch grocery delivery via WhatsApp in India. Ulta announced introducing a new store layout. But first we take off with Walmart's new rewards program for Walmart Plus members. Anne.
Anne Mezzenga: Yes, all right, Chris. According to Retail Dive, Walmart has launched Walmart Rewards as a new benefit to its Walmart Plus membership. Is this going to happen every week where we're like," And now an offering for Walmart Plus."
Chris Walton: I kind of feel like it, that's a great point actually.
Anne Mezzenga: Okay, shoppers can earn and redeem rewards both in store and online. For online shoppers, customers can tap the add reward option under eligible items on Walmart site or app to claim the savings and then apply their rewards balance to their purchase at checkout. When you're redeeming rewards in store, shoppers have to use a QR code that they scan that we generated through the Walmart Pay app and they can add those benefits when they use the checkout at payment. Walmart Plus members can track their rewards accumulation through the reward center on the retailer site and app. And all saved item rewards will have expiration dates.
Chris Walton: Expiration dates.
Anne Mezzenga: Keynote, meaning customers must buy the item before the reward expires. Chris.
Chris Walton: Yes. You're going to start me off again, aren't you? I know you are.
Anne Mezzenga: I'm going to start you off again.
Chris Walton: Every time you do that, I'm like,"All right, here we go."
Anne Mezzenga: ... is also choosing this question of all the topics for this week to put you on the spot.
Chris Walton: All right, let's do it. Because I got a lot to say about this one.
Anne Mezzenga: Yeah, because just two weeks ago, we had David Brown and Abhinav Chandra of A&M on the show. And we were talking at that point again about Walmart including Paramount Plus as part of the Walmart Plus benefits. They're wondering if... let me start this question over again here. They are wondering-
Chris Walton: The beauty of going live, Anne.
Anne Mezzenga: Was it enough to create subscription adoption and ask what's next for Walmart Plus? Which impact will be bigger for Walmart with this rewards program? Boost to Walmart Plus members or CPG participation in its retail media platform?
Chris Walton: I love what A&M CRG is insinuating there. I love that question. Oh my God. It's so good. Yeah, I love it because it gets the heart of the possible motivation behind this whole thing too. Which I think is really important. And to me, this is a play for the CBGs like A& M is alluding to, versus being customer first. I've said this before around this program, but Sam Walton is now officially turning over in his grave, in my opinion. Because you're creating two stratems of customers here. Almost most definitely you are. Those you want to reward that have higher incomes and are willing to pay a hundred dollars a year to get Walmart Plus, and those who don't. That smacks full in the face of EDLP as a concept at Walmart. Why should I have to pay a hundred dollars to get these rewards?
Anne Mezzenga: I don't know.
Chris Walton: There's a part of me when I read this headline, I was kind of like," Wait, Walmart doesn't already do this?" There are plenty of other perks programs that you don't have to pay for at competing retailers that do the same thing. Why am I making my Walmart Plus customers pay for this or my Walmart customers pay for this?
Anne Mezzenga: I agree.
Chris Walton: Which just makes no sense. So that's why A& M's questions so brilliant because that's the motivation here. It's the retail media network to try to unlock the dollars through this by talking to your most advantageous consumer in your Walmart portfolio for those CPGs. I think it just reeks. I don't like this at all.
Anne Mezzenga: Yeah, I completely agree. I mean, I think... especially when your customers have the option to download apps like upside, like fetch rewards for free, they're getting cash-
Chris Walton: That's a great point.
Anne Mezzenga: That they can deposit into their account that day. That's not limited to the Walmart universe. Obviously, you get cash back on rewards no matter where you're shopping. I think that makes so much more sense. There's just so many better options for the customer. So I totally agree this is-
Chris Walton: Like how is this a thing?
Anne Mezzenga: This is not a customer thing. I want somebody listening or if you're listening live, tell us what we're missing here though.
Chris Walton: Please.
Anne Mezzenga: Because I feel like somebody at Walmart had to pitch this as some kind of... like they're going at it as a customer benefit. We know the CPG angle that A&M is bringing up, which is a smart one. But like, what is the customer supposed to take? How PR teams at Walmart, what is the plan here to make sense of this for the customer? I also think... you bring up the point about how you're getting the most valuable customer here and you're giving access to the CPGs, to that customer. But wouldn't it be more valuable to open this up to all customers and have a wider data set? It's the biggest physical retailer in the country.
Chris Walton: Which it sounds like they're going to do when you read between the lines of how they're positioning this. I think they know this is going to be a criticism is what I read in it. But the point that you bring me back to is when they debuted Walmart Plus, this came under fire too. You're creating a new strata. And now you're saying we're going to do it even more. It's unfathomable to me.
Anne Mezzenga: Yeah, it clearly showing that the way that Walmart is going to try to make money from Walmart Plus is by developing a stream of revenue from CPGs to make Walmart Plus a profitable program. Not from actually having customers on the Walmart Plus platform.
Chris Walton: At the end of the day, if that's what you're saying, it's not going to drive consumer adoption. I can get these benefits somewhere else and not pay for them.
Anne Mezzenga: Yeah, exactly. Okay, Chris-
Chris Walton: Just another... oh, go ahead.
Anne Mezzenga: Good morning to Kelvin C-
Chris Walton: Kelvin C.
Anne Mezzenga: And Kelvin C would like you to take us to the next headline.
Chris Walton: All right, well do it. All right. Hey Kelvin C, I like your name. It's so hot, get it? Kelvin. Got it.
Anne Mezzenga: Oh geez.
Chris Walton: Yeah, all right.
Anne Mezzenga: Oh my God. I can't edit out the jokes this morning, you guys. I'm sorry.
Chris Walton: Meteorology joke. All right.
Anne Mezzenga: Apologize in advance.
Chris Walton: I hope I didn't offend, Kelvin. But I'm live here in the moment. All right. Macy's is about to get some rare Chris love on today's podcast. Bloomingdale's, which is owned by Macy's, plans to open its second store under the Bloomie's banner. According to chain story, the upscale department store retailer, second Bloomie's location at Westfield Oak Orchard in Skokie, Illinois. Skokie, Annie.
Anne Mezzenga: On my God.
Chris Walton: Bloomie's in Skokie. The existing Bloomingdale's store at Old Orchard will close upon the opening of Bloomie's, which is expected to take place at the end of October. And the new 50, 000 square foot Bloomie's store... I can't get over saying Bloomie's-
Anne Mezzenga: I can tell.
Chris Walton: I just love saying Bloomie's.
Anne Mezzenga: You are doing the, George loves that. You just did the-
Chris Walton: I know I did that. Totally. Yeah.
Anne Mezzenga: Chris loves this headline.
Chris Walton: I did that. Totally, totally. That might have been a function of editing pre- show. But the Bloomie's store will open at a new location at the mall. Anne, what do you think of this news?
Anne Mezzenga: Okay. I don't know, Chris.
Chris Walton: Really? I like... okay. Well, you go first.
Anne Mezzenga: I think that this makes sense in a way, because to me, it reminds me of the model that's worked for Nordstrom. And Bloomie's, I think, is much more comparable to a Nordstrom in terms of brand offerings-
Chris Walton: Oh, a hundred percent.
Anne Mezzenga: And service offerings. I mean, it's just a higher end concept than doing this at a Macy's, for example. So I think it makes sense to explore this, but I just still am missing how Bloomie'... like nothing that's coming out here, it just sounds like smaller format. They're taking what was 120,000 three story mall store and they're condensing it into 50, 000 square feet. But there's still no talk about how they're going to enhance omnichannel capabilities and how they're investing in the overall customer experience. Just being good at service is not going to pay off anymore. Clearly we're seeing that with Nordstrom and what their numbers are coming in right now. I think that 50, 000 square feet also still is big. The closest thing I think of now, when I'm thinking about this reinvention of the department store is Amazon style. Amazon style is only 30,000 square feet. Bloomie's, if you're going to really invest in this, how do you really get down to a significant sizing decrease and use the technology that you have at your fingertips... that the industry has at their fingertips to really improve the overall shopping experience. And keep that in a small footprint, keep your square footage down so that you can be functional and have that impact immediately to your bottom line by not having as much real estate.
Chris Walton: Yeah, that's an interesting-
Anne Mezzenga: Why do you love it so much?
Chris Walton: That's an interesting point. Oh, so you know I love this?
Anne Mezzenga: Well, you said that in the beginning because you were third person talking,
Chris Walton: I kind of teased it, right? Yeah, I teased it, right? Yeah. I mean, I think you're bringing up good points though. Your points about, hey, you're making these new stores, why don't you make them as advanced from an omnichannel technology perspective as you can? Because I think you're right. You read between the lines and what you're saying is, it's a real estate strategy at the end of the day. But I still like it for that reason. I'd say not all horses are of the same color. So it's a smaller version of Bloomingdale's, in my mind, is not the same thing as a smaller version of a Macy's or a Kohls.
Anne Mezzenga: Why?
Chris Walton: And I'll tell you why, and it goes back to real estate. There are damn near a thousand stores under each of those brands, Macy's and Kohls. How many Bloomingdale stores there are, Anne?
Anne Mezzenga: I don't.
Chris Walton: Looked this up, it's really interesting. It's far less than I thought. According to Chain Storage, 33.
Anne Mezzenga: Okay.
Chris Walton: So, 33 throughout the country. So a smaller version of an upscale experience makes sense because most of the nation likely aspires to shop there and honestly, can't. But Kohls and Macy's, if you have a larger one in your backyard, when you're that ubiquitously throughout the country. That's not a desirable thing to then go to a smaller option. You're going to want to go to the place-
Anne Mezzenga: That's a good point.
Chris Walton: With the larger selection. And so you have the risk of cannibalization there, too. So I like this because you don't have the cannibalization risk, you're going to get a pretty high return on your assets relative to your existing store base with this strategy that Bloomingdale's is incorporating. So I got to give Jeff Gennette and Macy's a thumbs up on this one. Which I have never done, I think, in the history of this show. But I think this makes sense. To your point, I think it's a good criticism. But I think you can also still do that over time.
Anne Mezzenga: Yeah, absolutely.
Chris Walton: This is only the second one. So they can try to fortify them. Hopefully they take that approach as they go forward to fortify them technologically.
Anne Mezzenga: Yeah. I guess I just have concerns about... I forget who we were interviewing the other day. But it was like," When do you get to phase two?" Is this going to get killed because it wasn't successful in it's first rollout because it was still too big. Even having the opportunity to shop at this Bloomie's that they haven't had the opportunity to shop at because the closest one is 150 miles away. You still have to be investing the equivalent of the new store format and design in technology, I think, for this to truly be successful. So, I don't know.
Chris Walton: Yeah. I got to hunch though, that first one's working. I just got to hunch. I got to hunch that.
Anne Mezzenga: Well, we're going to be down... it's in Dallas, right? Oh no, I'm thinking of the small format Macy's store.
Chris Walton: I can't remember, I think the first... yeah, the small format Macy's store-
Anne Mezzenga: We should go. We need to go.
Chris Walton: We definitely have to go see that for sure.
Anne Mezzenga: We need to add that to our list. Yeah.
Chris Walton: But Skokie's not far, actually, we could probably hit that in a day. Stay tuned, folks.
Anne Mezzenga: Your friend Kelvin said it is really hot-
Chris Walton: Nice.
Anne Mezzenga: In Singapore.
Chris Walton: Yes, Kelvin gets the joke. I love it.
Anne Mezzenga: I always appreciate when people pander to Chris's jokes.
Chris Walton: Kelvin, I'm now your biggest fan, Kelvin. All right.
Anne Mezzenga: Oh my God. All right, let's go to headline number three. So according to Chain Store Age again, Instacart is launching Big and Bulky, a new fulfillment capability that enables same day and scheduled delivery for large items that are big and bulky nationwide. Big Lots, The Container Store, Office Depot and Staples are just a few of the retailers who have already signed up to use this service. These retailers and others are now offering same day delivery of large items, such as outdoor furniture, home office supplies and electronics via the Instacart app. In some cases Big and Bulky is even offered via retailers' own Instacart powered websites.
Chris Walton: Yeah, that was interesting.
Anne Mezzenga: It should also be noted that the fulfillment technology behind Big and Bulky runs on Instacart's carrot delivery and enterprise solution from Instacart, that provides end to end fulfillment for retailers. Chris, I think you're our resident big and bulky expert now after yesterday's panel. So please pontificate on what you think of this new headline from Instacart.
Chris Walton: From Instacart. Oh my God. Two words that have never been said about me in my life, big and bulky. So backstory there that Anne's alluded to, I moderated a panel with two cool companies actually yesterday, on big and bulky delivery and how it's transforming the industry. Which I think is important, I learned a lot from that discussion and here's what I'd say about this headline, Anne. And then want to hear what you've got to say, as well. I think it makes sense strategically if I'm Instacart, especially as they're trying to add revenue to goose their IPO. I think that's kind of potentially what's going on here.
Anne Mezzenga: I think that's a hundred percent right.
Chris Walton: You think so?
Anne Mezzenga: Yeah.
Chris Walton: Okay. But I would also say that this is really hard to do well. As I know from-
Anne Mezzenga: Exactly.
Chris Walton: The former head of home furnishings for target. com, which is all about big and bulky delivery, you're talking sofas, couches.
Anne Mezzenga: See, you are the resident expert on big and bulky. I joke, but you actually have experience-
Chris Walton: I know relatively more about this-
Anne Mezzenga: Stemming years back.
Chris Walton: Than I do some of the things we talk about on a weekly basis. But, yeah, I mean some of the issues that come up. For example, you have products that are harder to ship, they're big and bulky. That goes without saying. The other thing you have is customers typically need to be home to take these orders, which is an important factor. Then the other part that's really hard with this is when a product arrives and it's not in the condition that the customer expects.
Anne Mezzenga: Oh yeah.
Chris Walton: That return process is a nightmare.
Anne Mezzenga: Yeah. You don't want to be that delivery person.
Chris Walton: No. So the other point, one of the companies I interviewed yesterday was called Dolly. I interviewed their CEO. They've been trying to basically nationally brand LTL delivery for the past seven years.
Anne Mezzenga: What's LTL delivery for the listeners who might not know that acronym?
Chris Walton: Basically it means when you have a nonstandard product that you need to deliver in a bigger truck than a car or a trunk. Like the DoorDash Facebook story we covered a couple weeks ago. This is different. And so they're trying to build a national brand around that, but it shows you that it's really hard, they've been doing it for seven years and they still haven't accomplished that. Now Instacart's saying," Oh, we're suddenly going to do this with all these new complexities." So to me, if I was Instacart while it maybe makes sense strategically, it wouldn't be where I would focus my revenue and profit driving efforts to goose an IPO right now. Because it's going to take a hell of a long time.
Anne Mezzenga: Yeah. Okay, we said we've been hearing tons at this conference at Home Delivery World about the challenges of what you're talking about of shipping large items, big and bulky delivery. You've been shipping these products for the last 10 years since you were at Target, as you mentioned. And I get the IPO like upcoming and how you expand your offerings and everything. But this is really hard to do.
Chris Walton: Right. That's exactly my point.
Anne Mezzenga: Why Instacart is taking this on with all of the other things that are out there? Even if Instacart just said," Hey, Meta, we see you're partnering with DoorDash. Do you want to partner with us too?" Just finding other ways. Because it's not just about... I don't know. The gig drivers that they're talking about here, that was another thing that occurred to me. Do you remember the early days of Uber and how much longer it took to get an Uber XL? Now you need the gig workers for Instacart who have larger vehicles to be able to sign up-
Chris Walton: They have to be trained.
Anne Mezzenga: For this kind of thing. I just don't see that happening. With gas prices being what they are. The average gig worker I imagine is using their most fuel efficient, fastest, smallest car that they can to run as many deliveries as they can to make as much money as possible within that hour. Who's signing up for this service offering as your gig worker? I think it's going to be a challenge for Instacart to make this profitable.
Chris Walton: A hundred percent. I think you're hitting on the head. What it actually makes me think about too, is if you're actually Office Depot or Staples in this headline, I'd actually be questioning your judgment here. Because you're right, this is going to be harder than the garden variety thing Instacart does day in and day out.
Anne Mezzenga: Yes.
Chris Walton: They don't have the muscle memory on how to do it. There's already profit questions around Instacart. This is going to be a less profitable activity at startup than what you were doing before. It has to be. Fundamentally, it just doesn't necessarily make sense. It seems like another stretch or a reach. And probably an indictment on those companies, too. Because like I said, this company, Dolly, they've been doing this for seven years and he talked all about the training, the intense training they put their drivers through to get the gig workers to make sure the truck is up to standard. Instacart's going to have to learn how to do all of that.
Anne Mezzenga: Yes. There's a reason that nobody's touching this with a 10 foot big and bulky delivery.
Chris Walton: Yeah, it's really hard. Most of the deliveries are done very decentralized. It's like Joe and John and their truck that are just happening to be contracted by a given retailer to do the delivery. It's a crazy space. All right, let's keep moving. According to tech crunch, Meta and an eCommerce venture between India's reliance retail and Jio platforms are bringing grocery shopping to WhatsApp. And what they said is the first end to end shopping experience on the popular instant messaging platform. The launch of JioMart on WhatsApp follows Meta and JioMart beginning to test an integration with select users two years ago. I think I remember talking about that, actually.
Anne Mezzenga: Yeah, I do too. It sounds familiar.
Chris Walton: Customers in India will be able to browse JioMart's entire grocery catalog on WhatsApp, add items to a cart and make payments via local payments, rail UPI without ever leaving the instant messaging service, the companies both said. WhatsApp, it should also be noted is used by about half a billion Indians each month.
Anne Mezzenga: That's crazy.
Chris Walton: I know that's nuts. I put that in there because I thought that was an important context-
Anne Mezzenga: Oh, I agree.
Chris Walton: Especially for the US market. Anne, do you think this is a sign of the future? Do you think we'll all be shopping via text messaging at some point in time?
Anne Mezzenga: I don't know. I'm going to go back to what I said at the beginning of this podcast, in that I'm trying not to remove the possibility that some people will want to shop that way. Do I think it's going to be grocery order pick up in store or buy online pickup in store right away? I don't know. But I do think that it's important, like you noted. Half a billion-
Chris Walton: Yeah, half a billion.
Anne Mezzenga: Indians are already using WhatsApp as a day to day-
Chris Walton: That's crazy.
Anne Mezzenga: Behavior. What I'm most curious about is will they start to shift behavior then of going to... bell peppers, like where can I get bell peppers going from Google and now doing that behavior, if they can, inside WhatsApp. Where they have open already on their tablet, if you can start search behaviors now in WhatsApp. I don't think it's too far fetched to say," Yes, this could now be an opportunity for me to build a basket." I think especially if you can connect this to other friends or family members in that same order to be able to just execute those ones and twos in a quick pick up order for the week. I definitely think that this could be a viable option. I think this is a great way for the pickers to be communicating then inside WhatsApp as well. Again, you already have that open. So instead of having to go to the JioMart app in order to communicate with them-
Chris Walton: The customer service side.
Anne Mezzenga: Yeah. It's like everything's staying all within that one space. Asia, in general, is much more familiar with one app, the super app, to control all of your day to day activities. So I don't think it's too far fetched. I don't know that we'll see this happening in the US right away. I do like this. I think it's really cool. And something that we should be watching really closely.
Chris Walton: Yeah. I like how you think about that. I like how you said it, too. I think what you make me think of is kind of the live streaming conversation that we've had of why it works in Asia, but doesn't necessarily work in the same way over here. I think the context of the country matters. And so for me, I used to think that we'd all be doing this shopping by text message. But now I'm not so sure because it's so prevalent in India and it's prevalent here, but there are other options here that aren't necessarily as ingrained over in India. So for example, for me, Amazon here, it's going to be really hard to thwart the Amazon, find what I want, one click buy. That's just such an easy experience. So for text messaging to work long term, it's going to come down to the UX. It has to be a really different vision, which I can't even fathom what that is in my mind. But if someone can come up with it, it could happen. But I think it's more likely to happen there than I think it is in the states. And so therefore from my perspective, as I was thinking about this last night, I wouldn't be investing on the commerce side of it if I was a retailer. I'd be investing in more on the points you brought up, which is how do I create that one- to- one communication connection with my customer on the customer service side of things. Once I've placed an order or keeping an ongoing conversation with my customers as well. That's how I would think about this.
Anne Mezzenga: In a platform that they already have opened.
Chris Walton: I'd be watching it. I'd be investigated to say," Hey, what are they doing with the UX in India as it comes about? And can we learn from that?" But yeah, that's how I'd be thinking about it.
Anne Mezzenga: All right, Chris, let's go to our last headline. Number five, Ulta plans to introduce a new layout in its stores coming this Fall. I love this headline.
Chris Walton: I know. Yeah.
Anne Mezzenga: So according to-
Chris Walton: It's going to get spicy, everyone-
Anne Mezzenga: It could, it could.
Chris Walton: Hold on.
Anne Mezzenga: So according to Retail Dive, the company plans to introduce a new front of store presentation in September that will focus on editorial, storytelling, around trends, events, and new products. Ulta's current layout is organized for you, Chris, who I think we've been into an Ulta store together a couple of times. But if you don't remember, they currently organize by price point with prestige makeup brands and other skincare on one side of the store and then mass makeup and skincare on the other, kind of goes down the center aisle. Fragrance is in the middle of the stores and hair care is in the back. This new vision involves consolidating categories, meaning it plans to place mass and prestige together still with clear brand delineations. How they're going to do that specifically will yet to be seen.
Chris Walton: Still to be determined.
Anne Mezzenga: Yes. Still to be determined. But why are you a little" hmm" on this?
Chris Walton: Oh, you can tell already?
Anne Mezzenga: Yes.
Chris Walton: Yeah. Because I think this is a big nothing burger. This story is absolute nothing burger. The reason I say that, especially in the realm of omnichannel evolution, it's your job to merchandise the store to the trends and how people shop.
Anne Mezzenga: Fair, fair.
Chris Walton: I mean, at the end of the day, if I put my merchant hat on, it just sounds to me like good, better, best merchandising to me. That's all it is and I don't get it. But I'm not the beauty consumer. So this resonated with you, so as the theme of this podcast is just trying to keep an open mind. You did love this. So why did you love it?
Anne Mezzenga: I mean isn't this what retail merchants are supposed to be doing?
Chris Walton: Yeah, exactly my point.
Anne Mezzenga: Yeah. So following trends is right, I think it's following how we are shopping online and what the physical equivalent of that is in the store. It doesn't have to be the exact same thing, but we merchants should be testing new ways of doing this. So yes, Ulta, let's continue that. I think though, that this allows for other products to be entered into the universe of consideration. So say for example, green is a trend color. It's like the Pantone color of 2023. I don't know that for sure, but let's just play along with that theory. I think from a shopper's perspective, it's really cool to be able to go in and instead of just seeing the NARS end cap that shows what the NARS green trends look like and-
Chris Walton: Or what trend their playing up.
Anne Mezzenga: How it looks like. Yeah. And then Kylie or the Ulta beauty owned brand, I would love to see one display where it's like," Here are all the coolest green... the top 10 green makeup trends that we have in the store." And giving the opportunity for the associates in the Ulta store too, to be able to speak to that, to take people to it and be like," Hey, if you want the budget buy for the NARS eyeshadow, here's the version right here." You have that at your disposal all in one centralized place. Plus I think once... as we've been talking about, supply chain at this conference a lot too. I think it allows when out of stocks happen to quickly be able to put other product in to still capture that sale. Which frequently happens with some of the makeup palettes that come out-
Chris Walton: That's fair.
Anne Mezzenga: That are limited time offers. If that's gone, if that end cap display is gone, how can you put in and still keep with this theme? That's true to how your customers are shopping online is a great way to do this.
Chris Walton: Yeah, it's interesting. I hear your points. I think you're over attributing it a little too much in terms of what's happening here. I think all of those things could be done in a traditional merchandising setting, especially the reorganizing. But at the end of the day, if you want to play up a trend story and you think as Ulta, you need to play up your trend stories more in a new way, kudos to you for doing it. I don't think it's that big of a deal. I think-
Anne Mezzenga: Let me ask you this as a former merchant, do you think that it will encourage the retailers? Oh God.
Chris Walton: Sorry. Whoa, random cough.
Anne Mezzenga: Do you think that it will encourage retailers to work differently with the brands that they... just to be thinking about these displays differently. Instead of brands typically executing an end cap, again, we'll use the NARS example. Where it's like," This is our holiday pallet. This is what is included in that. Boom, we just shipped this out to every single retailer." Versus now trying to work with the creative team, truly create a better selling experience.
Chris Walton: Yeah, that's a good point. And I think that's the point that I like about this the most is... and especially in the beauty category. It's always seemed to me that the beauty category is at the behest of the brands. They are merchandising to what the brands want, which is good and bad in the sense of you get a lot of dollars that way, but you're not always merchandising it to what your customer wants or how your customer wants it to be presented. You're merchandising to what your brand expects you, but that's a middle person, that's not you as the brand. The approach does potentially free up more creativity and merchandising for you to tap into what your customers want day in and day out. Which is just an axiom that I think every retailer should believe in. And figure out the right balance of that mix between how it's traditionally been done and how it is going forward. But I think that's a great point.
Anne Mezzenga: All right. Well, Ulta, we'll be checking out the new displays in store.
Chris Walton: Yeah, watch what'll go in and we'll be like," Eh, okay." Who knows?
Anne Mezzenga: All right. So we're going to get to the lightning round now. Chris, question number one is for you. If you find yourself in New York, not too far, a hop, skip and a jump from here in Philly, which of the following items require that you now be 21 to purchase?
Chris Walton: Okay.
Anne Mezzenga: Franzia box wine.
Chris Walton: Franzia box wine.
Anne Mezzenga: Pabst Blue Ribbon.
Chris Walton: Pabst Blue Ribbon.
Anne Mezzenga: Reddi-Wip.
Chris Walton: Reddi-Wip. Okay. Well I'm going to guess it's Reddi- Wip because one of those is not like the other.
Anne Mezzenga: You now need to show an ID that you were 21 or older to consume Reddi- Wip... to purchase and consume Reddi- Wip in New York.
Chris Walton: How does one actually consume a whip it, by the way. I actually don't know the answer to that.
Anne Mezzenga: We are not legally able to talk about that on this podcast.
Chris Walton: We're not able to talk about that on the podcast.
Anne Mezzenga: Let's go to-
Chris Walton: Okay, can you tell me later?
Anne Mezzenga: Yes.
Chris Walton: Because I actually don't know. I feel like very naive right now.
Anne Mezzenga: We'll have a little heart to heart on it.
Chris Walton: I don't know why I'm assuming you know that, but if you can help me with that-
Anne Mezzenga: I mean, I think for good reason probably.
Chris Walton: I think that'd be... all right. All right, let's keep going. New Jersey recently banned shopping bags, both paper and plastic. I've heard a lot about this at the conference actually. People in the halls talking about this. So people are resorting to stealing the little plastic hand baskets, like legitimately. It's causing a ton of problems for these retailers. My question to you is, what percent of your grocery shopping trips are hand baskets versus carts?
Anne Mezzenga: Oh, I would say 90% hand baskets.
Chris Walton: Really?
Anne Mezzenga: Because I only-
Chris Walton: I'm so shocked.
Anne Mezzenga: I only do the infield trips-
Chris Walton: Oh you do?
Anne Mezzenga: The quick, like we need these few things.
Chris Walton: That's right, Mr. Omni Talk does the Costco run, right?
Anne Mezzenga: He does the Costco stock up weekly. So I'm just going for the things that Costco doesn't have, basically. Which usually fit in a hand basket, but I'm not stealing them.
Chris Walton: Yeah, right. No, you're not. Yeah, that's true. Mine are probably like 50 hand basket, 50 nothing, I think actually
Anne Mezzenga: You're just juggling them.
Chris Walton: Yeah. Right. It's usually like," Hey kids, you take this, I take this. We're going in quick."
Anne Mezzenga: Oh my God.
Chris Walton: Get it done.
Anne Mezzenga: Don't drop the melon.
Chris Walton: Get her done.
Anne Mezzenga: All right. Chris, Panera is piloting voice AI ordering tech called Tori, that will now take orders at its select New York locations. Again in New York. What's the last thing you ordered at Panera? And when was that?
Chris Walton: First of all, why do all these things need names?
Anne Mezzenga: I don't know, it makes some more human, I guess.
Chris Walton: More catchy for marketing?
Anne Mezzenga: I don't know... yes.
Chris Walton: I don't know. I just don't get it.
Anne Mezzenga: The latter.
Chris Walton: That's really the answer, right? You're not going to believe this. But back in 2009, 2010, I was running the-
Anne Mezzenga: Sounds like an appropriate timeline.
Chris Walton: Baby department at Target. I religiously ate at Panera every day.
Anne Mezzenga: That does not surprise me at all.
Chris Walton: And it was a tuna sandwich every single day. Then, once it just stopped and I never went back, never went back. Overate it.
Anne Mezzenga: Okay, good. I'm going to remember that when we have our next discussion about the Panera coffee subscription and the fact that you haven't been there since 2009.
Chris Walton: Ooh, good dig, Anne. Damn, that one burned. All right. A man aptly named Cinder Fella. Something I never thought I'd say on this podcast, plans to set a Guinness world record by paddling an 846 pound pumpkin down the Missouri River for a total of 38 miles.
Anne Mezzenga: We got to do a deep dive on gourd density and how that's possible for a pumpkin that heavy to float.
Chris Walton: There's actually pictures of him in the pumpkin-
Anne Mezzenga: Yeah. I just don't understand the-
Chris Walton: Waiting down the river.
Anne Mezzenga: The physics of that. I got to... okay.
Chris Walton: So my question to you is, what is the most memorable thing you have ever done with a pumpkin?
Anne Mezzenga: Okay. Chris is coming up with all kinds of ideas. I'm sure based on your Reddi- Wip, whip it question that you're expecting me to say something totally inappropriate that I've done with a pumpkin. But I'm actually going to say something very sweet and my most memorable pumpkin memory is going to a cooking class with my now deceased grandmother who I loved and adored. We made a pumpkin lentil soup that was her favorite. So that's the best thing I've done with a pumpkin.
Chris Walton: That is amazing, Anne.
Anne Mezzenga: I know. Don't cry.
Chris Walton: God, I can't even use your out of your gourd joke that I was going to use. This just didn't work.
Anne Mezzenga: Well, Cinder Fella's out of his gourd.
Chris Walton: Cinder Fella is out of his gourd. Actually he-
Anne Mezzenga: Will be out, he's in his gourd.
Chris Walton: Gourd, yeah. I hope he stays in his gourd. All right, so it looks like we got some questions from the audience too. Let's do some audience participation right now.
Anne Mezzenga: Cammy wants to say that we're right on about the text messaging question that we're talking about with JioMart. And she said that we in the US are using text, iMessage more comparing to people in Asian countries. She said," Most of my family and friends in Southeast Asia are using WhatsApp and Line to communicate." Which I think plays into that earlier question of, does this become more collaborative in ordering in communication with your shopper?
Chris Walton: Yeah.
Anne Mezzenga: And then Kelvin-
Chris Walton: Yeah, Kelvin back again.
Anne Mezzenga: Kelvin also is dropping back in to say," Related to Ulta story, just read the article, NARS Drops NFTs to Mark it's 20th Anniversary in Hong Kong Retail."
Chris Walton: Oh, nice.
Anne Mezzenga: So we got to dig into that a little bit.
Chris Walton: Yeah. Got to dig into that.
Anne Mezzenga: Thank you so much to everybody for participating in the show today. Please leave your comments again and reviews in Apple Podcasts and wherever you're listening to this today.
Chris Walton: Yeah, that wraps us up and we got to give our happy birthdays today to Zendaya, Gloria Estefan and Anne, believe it or not the woman who can take all of me, Lily Tomlin.
Anne Mezzenga: What?
Chris Walton: And remember, you can only read or listen to one-
Anne Mezzenga: Like Lily Tomlin from the giant chair? Or are we talking Grace and Frankie?
Chris Walton: She's in the movie, All of me.
Anne Mezzenga: Oh.
Chris Walton: Oh, yeah.
Anne Mezzenga: Which Lily Tomlin though, I'm saying.
Chris Walton: The joke is lost.
Anne Mezzenga: Oh.
Chris Walton: She's in the movie, All of me. It's like my favorite movie... it's like my second favorite movie of all time.
Anne Mezzenga: So you don't really want Lily Tomlin to take all of you? Just clarifying.
Chris Walton: No, I don't.
Anne Mezzenga: Okay.
Chris Walton: But she can take all of me in that movie.
Anne Mezzenga: Okay.
Chris Walton: Does that make sense?
Anne Mezzenga: It does to people who understand the movie, All of Me. Yes.
Chris Walton: We are crashing and burning as we speak. All right, remember if you can only read or listen to one retail blog in the business, make it Omni Talk. Our Fast Five podcast is the quickest, fastest rundown of all the weeks top news and our twice weekly newsletter tells you the top five things you need to know each day and also features special content exclusive and it's just for you. We try really hard to make it fit within the preview pane of your inbox. You can sign up today at www.omnitalk. blog. Thanks as always for listening in, please remember to like and leave us a review wherever you happen to listen to your podcast or on YouTube. And remember, to use our promo code RBOT1950 to register for Grocery Shop, which is only two weeks away, roughly.
Anne Mezzenga: It is.
Chris Walton: That's RBOT1950. Anne and I will be there. We are now moderating multiple panels on stage and doing live streams throughout the show.
Anne Mezzenga: You're going to be sick of hearing us from Grocery Shop because-
Chris Walton: Yeah, probably.
Anne Mezzenga: We have so much coming at you. But it's really exciting. We can't wait.
Chris Walton: Yeah, so from all of us at Omni Talk retail, as always, be careful out there. Live from Home Delivery World.
Anne Mezzenga: The Omni Talk Fast Five is a Microsoft sponsored podcast. Microsoft club for retail connects your customers, your people and your data across the shopper journey, delivering personalized experiences and operational excellence. It 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 Takeoff. Takeoff is transforming grocery by empowering groceries to thrive online. The key is micro fulfillment. Small robotic fulfillment centers that can be leveraged at a hyper local scale. Takeoff also offers a robust software suite, so grocers can seamlessly integrate the robotic solution into their existing businesses. To learn more visit, takeoff. com. And Sezzle. Sezzle is an innovative buy now pay leader solution that allows shoppers to split purchases into four interest free payments over six weeks. To learn more, visit Sezzle. com.
- Shared mutual distaste for Walmart’s new rewards program for Walmart+ members
- Were somewhat split on Bloomingdale's second “Bloomie’s” store
- Discussed what the Meta and Jio WhatsApp partnership in India could mean for the future of text commerce in the U.S.
- Questioned what again seems like a desperate IPO-incented move by Instacart to get into big and bulky delivery
- And closed with a look at Ulta’s new in-store merchandising strategy
There’s all that, plus Lily Tomlin, Panera tuna, and Anne’s favorite pumpkin-shaped memories.
Music by hooksounds.com