Wendy 00:09

Wendy, hello, everyone. I'm Wendy Liebmann, CEO and chief shopper at WSL Strategic Retail. And this is Future Shop. This is where I talk to disruptors, iconoclasts and cloud specialist. Justin Honaman who is my partner in all things cloud, AI, digital e commerce, consumer packaged goods, he's a regular guest from Amazon Web Service, I can't remember the title. It's so massive,

Justin H. 00:38

it doesn't matter something in retail and CPG, anything

Wendy 00:42

with something anyway. Lovely to have you here. Happy End of Year. Thank you for joining me in our regular cloud chat. Good to see you.

Justin H. 00:54

I'm glad to be here, and I could be chief shopper in my house, for sure.

Wendy 01:14

I thought great opportunity for you and I, as we do, just to sort of level set where we ended up, what we learned this year in terms of everything from digital e commerce, AI, all of those things. But before we get into that, sure, Black Friday, did you go shopping? What did you buy? What did everybody else buy? I know, but what did you do? It's interesting

Justin H. 01:20

It’s interesting to see in retail now, just that event, but also that event is been replicated throughout the year, not only with Amazon, but other retailers. And so certainly, a lot of energy around Black Friday, a lot of excitement around the holiday. There's a lot of question on, like timing, because I think there's a one week less and other years and whatnot. But in general, from the retailers that I work with a lot of excitement, a lot of confidence in the inventory that they have, even if they had to pull forward future inventory, a lot of confidence, actually, in their approach around technology and new investments and personalization and loyalty, which I think is interesting, and we'll talk about that a little bit later, in terms of just acceleration in that space, but and then from the consumer. I mean, I, you know, I can just go off of the numbers that I've been watching around inflation, but certainly in most markets, inflation, it has has come down. A lot of concerns still around price and cost, especially in grocery Of course, and so I think that tension is still playing out there, especially around like from the from the manufacturer brand to the retailer. So there's still a lot of tension there,

Wendy 02:38

you say that tension, I was just speaking at the NACDS year end meeting in New York last week, and somebody said to me, Oh, that was a grim presentation you made. You're usually so optimistic and whatever. And I said, Listen, it's just that I'm not sure we're all listening. You know that here we were on the 36th floor of the Mandarin looking out over Central Park, talking about the wonders of the world, and when you look at all our How America Shops®, data and insight, you know, people are still people are increasingly pessimistic, you know, concerned about what the coming year looks like. It's not that they're not shopping for Christmas, the holidays, whatever it is, Chanukah, Kwanza think, on all of the above, but they're just feeling not happy. And I think that was a reflected, reflected in the election. So my message to this illustrious group was, are you listening? We know it. We intellectually know it, but are we listening? You know, people are challenging. They think we don't care about delivering quality anymore. So that was a lot of that conversation. So when you're saying that tension, I think, yeah, I would say to people, yeah,

Justin H. 03:46

I think from the industry perspective, there is a lot of tension. I mean, you know, manufacturers or food products have shrunk. What goes into those boxes and bags and charging the same price or higher, at some point, is there a threshold that customers say, enough is enough. And then you have digital, digital, native brands that are trying to make, you know, their way in that market. And they're doing pretty well, by the way, and some of the niches in that area. And then there's the high end, right?

Wendy 04:13

Yeah, then there's the luxury end, you know. And even that, when you think about luxury retail still being challenged. We're seeing that with a lot of luxury fashion brands around the world, and even luxury beauty in some spaces. So you're right. It's not it's there's a underlying tension that I think behooves us all to pay attention to, otherwise we too might get thrown out of office very quickly.

Justin H. 04:41

I think the thing is, for those listening like, if you're not reading and following a couple of different industry, I'll say news, including yours, by the way, Wendy and just what you provide like you're kind of missing out. And not only that, but you could follow. Behind, like it's good to follow what's going on and what you see from different data points with consumers and shoppers. It's good to follow what other retailers are doing or not doing. It's good to follow what's happening in the brand world, if you're in retail, trying to work with those brands and now, more than ever, I mean that this, this information is available, right? You know, anytime, anywhere. So it's just kind of no excuse for it. But I feel like a little bit people are like, kind of going, getting back into their usual ways, kind of the pre COVID, you know, things are better now, no supply chain issues, kind of, and I think that's a huge mistake if you're a brand or retailer, kind of going back to siloism and how we did things before. I think to

Wendy 05:42

think to your point, I mean, I know you are hugely engaged in looking absorbing cross industries, cross retailers, you know, digital and physical. And I know you have that. That's why I love your point of view. You have a very big view about what's going on, and it's sort of, it's the same for us. We are incredibly curious about unrelated things, and getting but getting people out of their proverbial ivory towers, out of their own aisles, out of their own shelf, you know, from their own shelf, to see some of the things they know already. I mean, that was my, beginning of my presentation the other day, anything you don't already know. And they were like, Why are we sitting here? Said, because you know it, but you don't see it. So to your point, I think that's a really important call to action. And even to your point, usually, is, go to things.

Justin H. 06:32

Get out, go, try it like so for if you guys are watching or listening to this and you don't know what Wendy does, like when she does her Retail Safaris®, they are not just store tours, like you're going to see in a couple weeks at NRS, like, store tours, okay, it's one thing, but curated, like, learning about what's going on in the store and what's happening behind the store, to enable the store experience is, like, a really big deal. And if you have stores like, you should be curious, like, it's so easy and it's so interesting, right? And I think that's one thing Wendy, you do really well, and the brands should care too, because the end of the day, their brand experience really ties to the retail

Wendy 07:09

experience. And it's as you well know, Justin was we did this event in London in October, and Justin was kind enough to to recommend one of his colleagues from Amazon Web Service based out of Europe, and we had a great conversation with retailers in the UK, traditional retailers, you know, grocery retailers, like CEO of Tesco. But we had, we had Justin's colleague Marco as part of it. We had people, yeah, we because, you know, for the group who basically came from the US, which was a big ask, right? But there was so much learning from looking at the stores, with the retailers, but also hearing the conversation, hearing the discussion about everything you just mentioned. So anyway, there's just so much to be learned. Over the last year, where we are in this journey, and, you know, tell me where, where we are at this moment, over the last year, we've talked a lot about where we are in this AI journey. And, you know, tell me where where we are at this moment.

Justin H. 09:20

okay, well, let's remember, for those who haven't watched the other versions of this, AI is not new. It's been around since the 50s. In fact, most of your companies are probably using it in some form or fashion, so put that over here, and that includes what we call machine learning. So don't worry. If you're not technical. We're not going to IT today. Okay? They're all the excitement last 18-24, months. I even have my bell here, like generative AI, every time someone would say it, I was great. It was like, all day long, for like, 20 months right now, it's, you know, yes, super important. It’s evolved so quickly. Like, we're making the huge investments in that space at Amazon, and because it's so transformational. And now, though, that's just becoming part of the supply chain conversation, part of the E commerce conversation, part of the CRM or marketing transformation conversation, it's no longer we got to have a meeting on generative AI and then come talk about supply chain, and that's what's different, I think, on that topic. And also, though, I find it shocking and surprising the number of business leaders that are not already using it when it's readily available and inside your walls, whether it be from us or one of your other tech partners. But yeah. I mean, it's progressing quickly. We just had our big tech event last week called re:Invent. A lot of announcements around this. There's a lot of investments still happening across the industry. I'll call it retail and consumer goods in this space. And there's real use cases now. So we're early days. Someone last week reminded me, they were like, you know, Justin, remember when the internet came out, like, the first year of the first year or two, people doubted they was like, this isn't gonna happen, and now there would be no business without the Internet. Same thing with Cloud Not gonna happen. We have pictures of Jeff Bezos on top on a magazine cover, where they were like, will this even work? Okay, here we are. You know, that was 2006 so I think we're year two. Two of this, and with a lot of runway in front of not only us, but the industry around leveraging tech and new ways. I think what's

Wendy 10:07

I think what's interesting, when we were in London, the between Tesco and Boots and a number of the retailers in the conversation, and Marco, your colleague, was part of that really talking about, as we think about AI, and just the app, the speed at which they've taken, to your point, things that they've been doing. Because this is not new news in so many ways, but using it from an operational standpoint, in terms of supply chain, forecasting, on the brand side, you know, getting my website right, getting the imagery, the content right, all of those things, updating things quickly, marketing, you know, personalization, how we thinking about what we're learning through that. So it was so interesting, because it wasn't like da-da bells and whistles, sparkles coming from the ceiling. It was more about Yeah, yeah, right. We're getting on with it. We're doing it, we're using it. And so I actually found that quite encouraging, because then it leaves you time, as each of the retailers said, to sort of step back and now say, Okay, now, how can we use it to, you know, engage differently with our customer, shoppers, whatever, as well. And so I think that it feel. It felt like, after that discussion, that we were more we were at the next, you know, two years in. What is it? What will the next piece of this look like? So I, I thought that was, that was really interesting to hear, as opposed to, you know, either hair on fire, I don't know what I'm doing, or here I am.

Justin H. 11:38

it's interesting too. It's created new conversations with companies that maybe hadn't traditionally worked with Amazon, or whether it be AWS or Broadway, Amazon, Amazon Grocery, Amazon Pharmacy, etc. You know, it really has, and in the grocery segment, there's many grocers that view Amazon as a competitor. But you know, last year, the last 12 months, that very eager and willing to then tech topic, talk about retail media. We could talk about that in a few minutes. And some of the advancements around store. I think, more broadly, kind of leveraging an Amazon partnership in a more strategic way has been interesting, right? Healthcare,

Wendy 12:19

and what I think about it, too, in the condo you mentioned Amazon Pharmacy, and I think about, you know, how that was, yes, there's a, there's a there's a problem out there. What's the solution, right? And it's not just more affordable prescriptions. That's one thing, but then it's that ability to add the layer of service, you know, subscription, that fits within that model, other things that I can get to solve a problem, solve a condition that's very easy at my fingertips. So I think about all of that, the more Amazon gets to know me. I know they're all the HIPPA rules and all of those sorts of things that the retailers deal with. But you know, the the speed at which that's begun to fill a void, both not just price, but information, efficiency, outcomes, all of that within this sort of new world that we're talking about. My

Justin H. 13:11

My coaching is, if any of you are watching and not in, it, no big deal. But find something that relates to technology that you can lean into and, like, just go learn about it. I'll give you a couple examples that will be relevant. If you're in E commerce, dive into personalization. Like, now doesn't have to be what we do, but like, how are you doing it? How are others doing it? If you're in Customer Care, like, you take calls or you're getting, you're getting orders in right, dive into contact center solution. Like, understand how it works. If you're in marketing and you're in CRM or an agency, doing, you know, driving campaigns like your CRM platform is one of my options throughout like, I'm just the idea of composable commerce that you might have heard or headless commerce or API. Don't worry about the tech, but it's more flexible way of having an E commerce platform. There's so many ways you can dive in. Like, if there's one thing, I just encourage people to dive in. If you're in data analytics, dive into the data platforms and the tools to get access to data and try the AI.

Wendy 14:10

Just begin. Play around with it, you know, play around with, yeah, buying a pair of shoes on through chat, versus excuse the expression Google, and it's amazing how quickly you know it gets to know you and I know there are scary things about all this, and everybody's worried about all of them. There

Justin H. 14:32

There are risks. There's certainly risks, and we're talking all about the opportunities here, but there are significant risks, and you all need to be aware of that too, or some of you need to be very aware of it versus others. But like, there are significant risks on the AI.

Wendy 14:43

So I think all of that have you seen as we move into 2025 are you seeing not just in the AI space, but any other things in the tech space, as it relates to consumer packaged goods or retail? Yeah. That you are looking to for NRF, or anything else that you see emerging on the horizon, speaking of Future Shop.

Justin H. 15:09

so I'll take, let's take consumer goods. I'll highlight maybe two or three things. We won't go into a lot of detail, because we'll have time today. But in the manufacturing world, a lot of focus on putting tech into their production facilities, or better insight, and then operation of those facilities. So you might hear that called Digital factory, digital manufacturing, connected factory. We do that, for example, with Heineken. They're, we're the connected brewery platform with them. So it's kind of interesting in supply chain. On the CPG side, consumer goods side, a lot of interest in inventory, visibility, traceability, right? That ties to retail and then using data to better plan. I know we've been talking about this for years, but right order, right place, right time, right amount, right quantity, not having out of stocks like those are things that aren't new to the industry, but the data and the tech behind it is getting better. I'll just say, um, Okay, one more on the CPG side, consumer and shopper marketing. Consumer said inside shopper marketing, a lot of times, they're doing everything in Excel. They're downloading Nielsen IQ data or other syndicated data. They're matching that up with submit data and POS data and big, glorious spreadsheets that your job could get easier soon because of the tech.

Wendy 16:24

Yeah, and so Let's also not forget the discussion you alluded to before, around retail media and you know, I get crazy about it's not just screens, people, it's not just another big pocket the retailers are digging into. But actually, if you get it right, you can take that data and you can personalize the conversation, and you can solve a problem, and you can do all of those things for a shopper. Of course, obviously, you can sell some space, but, you know, I keep thinking about where that's going, because that was the other big topic.

Justin H. 16:55

It felt like every event or a meeting at Grocery Shop was tied to retail media. So I'd walk into one room and it would be retail media, and I'd walk into another room and retail media. I mean, I know the whole event wasn't retail media, but, man, it was such a big focus and so and there is good reason, right? I mean, analysts are saying the big numbers, retailers expect big revenue outside of trade promotion dollars, and CPG brands are expecting a better way to sell products. So there, I think the next year will be a big year for that to come to fruition or prove itself out. Let's just say that, and

Wendy 17:31

that, and that's the thing I'm looking for. I did. I had head of digital, sorry, the head of retail media from CVS Health, on, I don't know, earlier in the year, is this really where we're going to be at the one to one personalization? Are we really going to, am I going to get the message that's right for me to encourage me to buy solve a problem? So I have that vision in my head, and we're going to do some I'll be out at CES I don't know if you're going. Are you going to the Consumer Electronics Show?

Justin H. 18:00

I am, I'm doing a session on shoppable video, yeah,

Wendy 18:03

okay, well, I know. Let's talk about that.

Justin H. 18:06

When you think about this, though, an app like there is a very good opportunity for the one to one engagement, right? I think, in source

Wendy 18:15

So for everybody who's not who's listening, not watching, Justin, just waved that infamous I waved my phone. We all have nav hands all the time, whatever we're doing right all the time. So he was just waving that. But that's the other piece I think about too a lot. How do I, you know, use that and not be getting rubbish stuff, but getting stuff that I really, really, really want in all of this. So AI, digital commerce, retail media, Amazon, all of that.

Justin H. 18:48

I think in-store tech is an area that we haven't talked about. But yeah, there's kind of two, well, I won't say two. There are retailers that are growing, expanding stores, opening new stores, investing in tech, in store, there are retailers that are struggling. There's a couple, but as we know that the business model isn't working right, and they're not investing now because they just can't really afford to. And then there are like, new markets that are opening and growing, where you kind of got digital savvy shoppers that are expecting that digital experience. And so I do think there's new and I have to say RFID, because I feel like it's going to have some play in certain fashion, apparel and whatnot, but in other areas, but in-store tech is certainly a big focus, not only for us, but our customers, and whether that be using cameras and digital and store or personalization and loyalty or Cloud POS, like we have a number of customers now moving their POS systems to the cloud, and that, you know, a couple years ago was, well, what about latency? Or, you know, will my orders go through? And that's just not. Yeah, a concern now for our customers, and so they're investing.

Wendy 20:04

The other question I want to ask you about this past year is, so there's, there was a lot of conversation about self checkout versus in person checkout. What are you seeing from your broad purview of where that's all headed, as we as opposed to the Go I really self checkout, right? What are you seeing retailers where they're keeping it, not keeping it, doing both. What are they doing?

Justin H. 20:29

Yep, yeah. So I mean, for us, if you, if you haven't been to an Amazon Go store which there's like, for example, I live in Atlanta, there's not one here, but many cities have them. And you, and we've shown this before, but on the app, the Amazon App, you have an in-store code at the top. You scan that code, the gate opens and you pick up product and just walk out. It's called, just walk out technology. In fact, in Las Vegas last week, there are two retailers that have or a retailer that has two locations, they have the just walk out technology kind of built into it in the Las Vegas airport, so you can try it out there if you happen to be going if you happen to be going there soon, which you will be for CES so outside of that, yeah, certain markets like, look at Europe, look at the UK, and then many others, by the way, including North America, self checkout is working. Yeah, there's a lot of noise around is the theft concern an issue? , and it depends on who you talk to, what you read, and which retailer you connect with. But certainly, we've seen, you know, with my customers in retail expansion of self-checkout technology, and what about you? You've done so many of these store tours the fact that you were just in the UK, so,

Wendy 21:43

yeah, absolutely no, you're right. And that's sort of, what I would call the Amazon Go model, versus being in a store where they've got checkout and then, I mean, people checking you out, and then they've got self checkout, but with somebody self checkout areas, so they're the things that people still seem to be struggling a bit with. But versus, it's my phone, I can go. They also seem better with the theft solutions, as opposed to us, we just lock it all up. Whereas, you know, Tesco has created a a piece that wraps around their expensive wine bottles, or liquor bottles, kind of like this thing that, you know, if you steal it, it goes off and stuff goes all over that. So other solutions, yeah.

Justin H. 22:27

yeah. I mean, I'll give you two examples. I think I look at a couple of retail examples, and these are northeast, North America centric, if you are listening or watching here. But I think Home Depot has just expanded their self checkout area, and they got a lot of small items in that store that are not locked up behind glass. And so they are expanding. I don't work there, and I don't know the insights on it, but the fact they're expanding that is interesting. Costco. Costco, as you all know, you fill your card up, and it's most likely easier to go through the line where you have an agent helping you check out, but they got self checkout now, so if you got a couple items, you're in and out of the Costco in minutes. So you see, even in some of the major chain, I will say, from what I've read and heard, by locking everything up, there's this tension of, do I reduce my sales versus, you know, preventing theft?

Wendy 23:24

Yeah. Well, we, we said that certainly in from our sentiment work, we see that, that, you know, people the irritation, the aggravation, the Okay, well, I'm going online to get it, or I'm not going back to that store, because they don't trust me. So on a, you know, future forward note, Future Shop. Couple of things that you're thinking about for 2025 expecting to see at the National Retail Federation, at the Consumer Electronics Show. What are you What are you looking for there? Interesting is we're going to see as we move into 2025

Justin H. 24:02

um, for so number one would be an increased interest in brand and retailer collaboration. And I think of that through like the lens of FMI, for those that know, the Food Marketing Institute there, I already seen, just from the planning for their meetings early next year. Just a real interest in the brands engaging with and looking at new channels, being open to new ideas, wanting to understand data and tech in a way that I haven't seen before. So that'd be one. NRF, there's no doubt, I think this year you will see a lot of AI for us and others, I already know for us, for sure, and then others, but some really cool ways of activating campaigns and creative and, you know, content, like one of our really cool demos at NRF that we're gonna You should all come by and say hello. By the way, but um is really showing how you select a model and let it you know based on what you're wanting to market, whether it be, you know, tennis shoes or other items. Selecting every part of the campaign, the content that created, the creative, the listing, the text, the everything across channels in seconds, right? So think about an agency or a marketer, especially in retail. It's powerful, right? It's kind of brings it to life. And you go, we can do that now, and we're not, you know, like, so that's going to be interesting. And then there's all kinds of new engagement tools and tech that are powered by not only AI, but just other types of technology. So I think there'll be a lot of that force at NRF. At CES. You know, CES is a different kind of show. It's not retail, it's not consumer goods industry, like visionary kind of really the place to go to really get big ideas across industries. And for those that have been there, it is. Is the Consumer Electronics Show. So a lot of tech is there. You see a lot of marketers. There, a lot of marketing and branding, a lot of ideas around products. So I think that's what you can think about there. If any of you haven't been and want to attend, yeah,

Wendy 26:11

yeah, with 30,000 of our most intimate friends, right?

Justin H. 26:16

Right? Yeah, you get, you see some things there that you just don't see anywhere else, and that's what they've, you know, done, a really nice job of curating. And the speaker set is different, and the companies, every big brand, and is there, you kind of, it's just, it's really interesting environment. It's unique,

Wendy 26:32

unique, yeah. And I think, you know, my last call to action, which I think is, is also yours, because you've raised this before, is, you know, we've all got a lot of day jobs. We've all got a lot of things we need to get done, but it's really important that you get out of your own heads, that you see things, and sometimes it's with the older or more established associations you just mentioned, FMI Food Marketing Institute, you know, as organizations continue To refine, not just the membership, but more about, you know, what they're trying to deliver to their membership? These are things that it seems like, oh, I have to go for a weekend. You know? I'm going to CES for a day. Would you believe it? Or you want to stab yourself? Wow, yeah, exactly. So you'll be, you'll be my entree into what else did you see? I'll be the locked away somewhere. But that part of things, the ability to look beyond, and I think the other thing that you just raised was this, you talked about it in the context of FMI, this ability to build different and different quality of partnership. I know that term has been overused with retail and manufacturers in any industry, yeah, but the really good ones now, on both sides, you're absolutely right. I mean, we're doing an immersion, actually, why I have to leave CES, we're off to Grand Rapids, Michigan right after CES, to do some work where we're bringing companies to that wonderful retailer, Meijer, to really spend some time one on one, look at stores, talk about issues of the day. Those things are really powerful now, because then you you can really they are very personalized approaches to what you want to do. Yeah, just so to your point on that they're the things on my list. Anything else before we you're going to be my last Yeah, on

Justin H. 28:22

that topic, I'll just mention, for those of you that maybe haven't, you know, you haven't been involved in the industry itself, like there. So first of all, you can do a quick search, and you'd find the top three or four or five industry organizations and retail and those also in consumer goods, and you'll see the ones. There's a couple that do some really good I'll say overlap, if you want to call it that, and you may be a leader. And yeah, you can buy a ticket, or you get the tickets for free. For most of these events, you can travel there and all that. But if you're an analyst, you're a manager, and you just, you know, you don't have an expense ability, right? You can still engage, and you can still learn from these groups that most of their contents online available because they want to build their brand. And so there's this is just another opportunity to learn. If you want to win in the industry yourself or with your company, you've got to engage with the industry. Okay, if you want to win there, you got to engage there.

Wendy 29:18

I love that. I think that's a great stepping into the new year, point of view, because we were forced to lock ourselves away for three or four years, and now, as we've moved out, we really have to, I think, aggressively move into this new world, because so much has happened, and we intellectualize it, and we don't pay attention. And I would say, also just, just to reinforce what Justin said, also really stays very close to your shoppers, your because they have changed, as we all have, personally, so much, and sometimes we forget that. So that would be my last leap into the into the new year. So I, as always, dear Justin. I thank you for that As always, always interesting, always compelling. Get out there. Everybody. Absorb what's going on and act, act, act, leap into the future. So then exactly,

Justin H. 30:12

thanks for having me. It's always enjoyable. I can't wait. We're gonna be a fast start to the year. I'm really excited for the next years.

Wendy 30:18

Me too. I feel the same way. So thank you for their vision of the future, and Cheers for now see you soon. You.