https://sanfrancisco.cbslocal.com/2021/11/23/update-shaken-holiday-shoppers-changing-plans-in-wake-of-retail-smash-and-grab-crime-spree/ A violent smash-and-grab robbery spree targeting retail shops across the Bay Area has shoppers, store employees and business owners on edge at the start the holiday shopping season. ADVERTISINGREAD MORE:9 Charged In Smash-and-Grab Robberies at Louis Vuitton, Other Stores At San Francisco's Union Square San Francisco's Union Square was one of the first shopping areas hit last Friday night when a Louis Vuitton store was among several shops that were looted. Over the weekend, businesses boarded up their windows as police stepped up patrols in response to the violent spree. UPDATE: Flash Mob Smash-and-Grab Robberies Dampen Holiday Spirit in San Francisco Several other stores and shopping malls across the region were targeted, with thieves storming into stores in Walnut Creek, Pleasanton, Hayward and San Jose. At the San Francisco Premium Outlets in Livermore Monday, police could be seen in patrol cars at nearby freeway on ramps and off ramps, just in case a group tries to hit the outlets and take off on I-580. But shoppers said they were very aware anything could happen. The holiday shopping experience has unquestionably been tainted by the recent smash and grab crime spree over the weekend. “My friends were actually there when there was a robbery they had to be stuck in a store during a robbery,” said one Pleasanton shopper, referring to the incident at the mall in Hayward. On Monday, she was out at the mall shopping with her mom and sister. “It's been alarming, so that's why we are here during the daytime,” she said. When asked if the crime spree had changed her shopping hours and habits, she replied, “Most definitely. I just got back from college and I was just made aware of everything that has been going on. It's kind of upsetting,” she explained. Many shoppers said they are worried about the growing trend of mass robberies and the looming question: where will they hit next? “I was surprised, because I never thought it would happen in Walnut Creek. I don't think it will happen here in Pleasanton Or Dublin,” said another shopper. But there was an attempt at the Stoneridge Mall in Pleasanton just after 1 a.m. Monday morning. A group of nine people were seen on surveillance video breaking into the mall, but they found that all of the stories had gates up that prevented entry. Pleasanton police say nothing was stolen. No arrests have been made in the case, but are studying surveillance video and trying to identify suspects. “It's devastating to see what has happened lately,” one shopper told KPIX. However, authorities are trying to address the situation with more of a police presence visible throughout the Tri-Valley area at various shopping destinations. READ MORE:Embattled District Attorney Chesa Boudin: 'We Want Everyone To Feel Safe' In San Francisco While Black Friday sales are happening at some retailers, it may not be a driving force for shoppers. Some stores saying they will simply be extending the Black Friday sales through the entire holiday season. At least one shopper told KPIX she wouldn't be going to stores. “No Black Friday shopping,” she said. “Stay safe!” Shoppers may have returned to Bay Area retail destinations like the Broadway Plaza after a mass robbery at the Nordstrom on Saturday, but they remain concerned it could happen again as police continue to look for suspects. “Typically when we see these types of things happening, they are well organized. They are larger groups,” said Howard Jordan, a former Oakland Police chief who now runs his own consulting firm. “This has to be a regional approach, right? It's not just San Francisco, Walnut Creek, Oakland. It's everywhere.” Jordan told KPIX 5 on Monday he wants to see more coordination with law enforcement agencies to try and track down suspects before they hit another store. He also echoed the calls for tough prosecution of anyone found guilty of these crimes. Rewards for the public to bring forward information could also help in the response, he suggested. “The state is supplementing those efforts and we are going to be more aggressive still in this space to help support cities and the prosecution of folks,” Gov. Gavin Newsom said at a news conference on Monday. “I have no sympathy, no empathy whatsoever people smashing and grabbing, stealing people's items, creating havoc and terror on our streets. None. Period. Full stop.” The governor joined local leaders in his promise for more security and a larger police presence at shopping centers leading into the holidays. Critics of local leaders say they have a history of failing to take criminals to task for non-violent charges. “If they arrest all 80 and prosecute all 80 to the maximum, then I'll come out and commend them for that publicly but until then they don't have a track record of doing that,” said Contra Costa County GOP Chairman Matt Shupe. KPIX 5 reached out to the district attorneys in Contra Costa and Santa Clara counties for comment on this issue. Both declined interview requests, explaining they wanted to wait until the investigations were closed on mass robbery cases in their respective jurisdictions. Jordan says some of the work needed to stop these crimes is already happening but he wants to wait to see what charges come through on suspects in all of the cases from over the weekend. He hopes that in another month, many more suspects will be in custody. “I would be surprised if the departments in the Bay Area aren't already working on a plan to address this type of activity. I would be very shocked if they're not,” he said. “Social media has probably been the biggest vehicle or avenue for criminals to communicate.” State and local leaders hope these crimes won't keep shoppers away from Bay Area malls and retail districts as so many businesses hope the holidays will help them recover from a difficult year and half during the pandemic. Jordan says the public should be careful but should not be afraid and stay home. “You should enjoy your life and carry on your life the way you normally can. Be mindful of what's around you. Be safe,” he said. Walnut Creek police on Monday announced that the dozens of looters who rushed the Nordstrom on Saturday night made off with between $100,000 ad $200,000 worth of merchandise. Though the city began placing officers inside Nordstrom earlier this year after similar smash-and-grab robberies, no officers were on site just before 9 p.m. Saturday when the coordinated attack took place. Connors said it's not clear whether there's a connection between the Nordstrom robbery and other incidents happening around the Bay Area. She said police believed another attempt would be made at Nordstrom Sunday night, and police blocked off ether end of the street and put its ready and react team on alert. No trouble was reported. MORE NEWS:After Deadly Weekend Of Crime, Oakland Police Deploy Tactical Teams Throughout City “I don't know if that made them divert, or what happened,” Connors said. “We had some information that that same group might come back. We prepared.” See omnystudio.com/listener for privacy information.
The supply chain is facing an enormous strain this holiday season. Shoppers are scrambling to buy their gifts as soon as possible. But what if it's actually an opportunity for consumers to consume less? Vox's Terry Nguyen (@terrygtnguyen) explains. References: Read Terry's story here Enjoyed this episode? Rate Recode Daily ⭐⭐⭐⭐⭐ and leave a review on Apple Podcasts. What do you want to learn about on Recode Daily? Send your requests and questions to email@example.com. We read every email! Subscribe for free. Be the first to hear the next episode of Recode Daily by subscribing in your favorite podcast app. Learn more about your ad choices. Visit megaphone.fm/adchoices This episode was made by: Host: Adam Clark Estes (@adamclarkestes) Producer: Alan Rodriguez Espinoza (@ardzes) Engineer: Melissa Pons Support Recode Daily by making a financial contribution to Vox! bit.ly/givepodcasts Learn more about your ad choices. Visit podcastchoices.com/adchoices
Will this be the beginning of a more consistent show?! (Golly, I sure hope so...!) In this episode, I muse a bit about wanting to cultivate a more "visible" community, share a few resources from my blog that will hopefully be helpful to handmade folks (shoppers & sellers alike), and share a couple book recommendations...Also, shout out to Reclectic Goods, my amazing crocheting friend! Please check her out at https://instagram.com/reclectic_goodsFind my directory of Kansas Makers & Artists here:https://mothandrustdiy.com/made-in-kansas/An Absolute Beginner's Guide to Setting Up Your Online Craft Biz (my ebook on getting started in the world of selling handmade online):https://mothandrustdiy.com/an-absolute-beginners-guide-to-setting-up-your-craft-biz-online-free-ebook/Chelsea Green Publishing: https://www.chelseagreen.com"Folks, This Ain't Normal: A Farmer's Advice for Happier Hens, Healthier People, and a Better World" by Joel Salatin (only $1.99 right now on Kindle!) https://www.amazon.com/Folks-This-Aint-Normal-Healthier-ebook/dp/B004RD84WC"Deep Work: Rules for Focused Success in a Distracted World" by Cal Newport: https://www.amazon.com/Deep-Work-Focused-Success-Distracted/dp/1455586692- - -Music in this podcast from freemusicarchive.org:"Every Time" by Katy Kirby is licensed under an Attribution License CC BY 4.0 https://creativecommons.org/licenses/by/4.0/"Minuet - Notebook for Anna Magdalena" by Aaron Dunn is licensed under a Public Domain License CC0- - - Please feel free to reach out to me at any time!My website: https://mothandrustdiy.comInstagram: https://www.instagram.com/moth_and_rustFacebook: https://www.facebook.com/mothandrusthandmadeCheck out my YouTube channel at https://www.youtube.com/c/mothandrustdiyIf you're interested in supporting me and this show, please check out my Etsy shop where you can find handmade accessories, clothing, patterns, art, and more:https://mothandrusthandmade.etsy.comYou can also shop my original fabric prints and more here:https://www.spoonflower.com/profiles/mothandrustPrairie Craft Almanac is a podcast exploring craft, nature, and simple, creative living.
Dana Telsey discusses how retailers are trying to stay on top of supply chain issues, and which chains are set to win this holiday season. Plus, PwC has crunched the number on progress being made in the return of business travel. And, do you have lunch plans? Robert Frank says if you're a power player in New York, you probably do.
Retail earnings continued today with Target reporting better-than-expected Q3 results. Like Walmart however, Target investors are worried about margins as the company absorbs higher costs of supply chain disruptions and labor shortages, rather than passing them on to consumers. Target CEO Brian Cornell addresses those concerns and details how the company has navigated global supply chain bottlenecks ahead of the holiday shopping season. Investing legend Mario Gabelli, chairman and CEO of GAMCO Investors, discusses markets, mergers, and NFTs for Christmas. Activision Blizzard shares are falling after a report from The Wall Street Journal alleged that CEO Bobby Kotick knew about sexual misconduct accusations at his company before he'd previously let on. Plus, the FDA plans to authorize Pfizer's Covid-19 booster shot for all adults as soon as Thursday; CNBC's Meg Tirrell reports on the latest pandemic headlines. In this episode:Brian Cornell, @TargetMario Gabelli, @MarioGabelliMeg Tirrell, @megtirrellAndrew Ross Sorkin, @andrewrsorkinJoe Kernen, @JoeSquawkBecky Quick, @BeckyQuickCameron Costa, @CameronCostaNY
Plus: Walmart reports higher sales as it raises prices. Home Depot reports better-than-expected sales. Fannie Mae, Freddie Mac will soon back mortgages of nearly $1 million. Trenae Nuri reports. Learn more about your ad choices. Visit megaphone.fm/adchoices
President Biden signs the $1T bipartisan infrastructure plan today, but the Build Back Better plan has yet to pass the House. Covid-19 cases are ticking up in some areas where vaccination rates and immunity is low, but after the holidays, Former FDA Commissioner Dr. Scott Gottlieb expects cases to decline again. He considers a future in which Covid is regarded much like the flu, with effective vaccines and oral therapeutics. Shoppers, look out: inflation could hike up your holiday bills. CNBC's Courtney Reagan shares retailer strategies and expectations heading into this holiday shopping season. Plus, Becky and Joe swap Thanksgiving stories and head down a musical memory lane. In this episode: Dr. Scott Gottlieb, @ScottGottliebMDCourtney Reagan, @CourtReaganJoe Kernen, @JoeSquawkBecky Quick, @BeckyQuickKatie Kramer, @Kramer_Katie
Have you made a purchase in the last 24 hours? Did you stay up till midnight for the coupons? November 11, otherwise known as Single's Day in China, has turned into the biggest ecommerce shopping event since its genesis 13 years ago. Have shoppers grown smarter and more rational this year? / Who should be writing the weekly reports? Not the employees! / Heart to Heart - please send your audio questions to firstname.lastname@example.org
Cross-border COVID travel restrictions have kept Tijuana shoppers from visiting San Ysidro stores, which means a large number of businesses near the border have closed or have been struggling to stay open. Business owners are hoping that will change now that the travel restrictions at the border have been lifted. Plus: California's economy is roaring back, food banks are battling rising food prices and more of the local news you need.
The first taste of normality for Aucklanders today - with retailers swinging open the doors for the first time in three months. At alert level 3 step 2 shops can reopen but with masks and social distancing in place. Shoppers were out in full force at Sylvia Park eager to do some physical browsing while shop owners were juggling trading under the restrictions. Reporter Louise Ternouth and camera operator Marika Khabazi went to check out the first day back.
70 - On this episode of Email Einsteins, we break down our proven techniques to keep all new customers engaged and coming back for more! The secret? A post-purchase bounce-back flow that incentivizes that second purchase immediately. We will run through the specific offers you should implement, when to send re-engagement emails, and which buyers to target with your post-purchase offers. Black Friday Cyber Monday is your chance to expand your base of loyal return customers. Let's get started.
In Clear Focus: The first in a series of podcast episodes accompanying Bigeye's 2021 study, Retail Disrupted: What Shoppers Want From Brands Today. Based on a national survey of over 1,500 US shoppers, it's clear that consumers are demanding more from retailers than ever before. In this pod, we explore key data points from the report with retail futurist Doug Stephens and influencer marketing expert Paige Garrett and discuss what the findings mean for retail and direct-to-consumer marketers.
As David rehearses in Toronto for the No Sleep Live show, he and Jack present the hillscarious show Attention Hellmart Shoppers from Fatecrafters. Learn more about your ad choices. Visit megaphone.fm/adchoices
It's Monday Matinee in the blustry month of November! Warm up to Sonic Society #531-Shoppers from Hell, followed by Sonic Summerstock Replay #2.4-Suspense, and The Cryptide Tapes: Bigfoot from Red Hawk Radio! Learn more about your ad choices. Visit megaphone.fm/adchoices
I Want That! How We All Became Shoppers: A Cultural History “I Want That! How We All Became Shoppers: A Cultural History” is the title of a new book by Thomas Hine. In this book he discusses why we want objects and how they change us. He looks at early forms of trading, and proceeds through the history of materialism. Thomas Hine recommends “Refinement of America,” by Richard Bushman. Originally Broadcast: December 17, 2002
The CPG Guys, Sri & PVSB, are joined in this episode by Ashwin Nathan, VP Head of Marketing and Advertising at H-E-B. Founded in 1905, H-E-B operates more than 400 stores in a number of formats and is the #1 food retailer in the Austin, San Antonio, Corpus Christi and Rio Grande Valley markets. It is the largest private company in Texas and one of the 15 largest privately held companies in the U.S.Follow Ashwin Nathan on LinkedIn at: https://www.linkedin.com/in/ashwinnathan/Follow H-E-B on LinkedIn at: https://www.linkedin.com/company/heb/Follow H-E-B online at: http://www.heb.comAshwin answers these questions:1) So what is this word retail transformation, and how have you been embracing it?2) Since the onset of the pandemic, it feels eCommerce is the word in the room, which does not really encompass omnichannel. please explain omnichannel for us as it pertains to HEB?3) You have been a digital maverick now for quite some time, what unique role does digital play in customer acquisition?4) How is HEB leveraging digital as an asset? When along the path to purchase is it engaging your customers?5) Take us through your own career journey - why digital leadership, why marketing6) In your current role how important is loyalty and how are you leading from the front, differentiating from your competitors?7) UX and conversion go hand in hand - how do you ensure this is the case8) Give us a prediction of what comes next in customer engagement - is it shoppable media? Where should brands & retailers be placing bets?DISCLAIMER: The content in this podcast episode is provided for general informational purposes only. By listening to our episode, you understand that no information contained in this episode should be construed as advice from CPGGUYS, LLC or the individual author, hosts, or guests, nor is it intended to be a substitute for research on any subject matter. Reference to any specific product or entity does not constitute an endorsement or recommendation by CPGGUYS, LLC. The views expressed by guests are their own and their appearance on the program does not imply an endorsement of them or any entity they represent. CPGGUYS LLC expressly disclaims any and all liability or responsibility for any direct, indirect, incidental, special, consequential or other damages arising out of any individual's use of, reference to, or inability to use this podcast or the information we presented in this podcast.
Bill Handel on the legal fallout from the Alec Baldwin prop gun mishap, the Orange County oil spill and who will take responsibility for the reparations, more frequent outages will afflict the U.S. power grid as states fail to prepare for climate change, and U.S. companies are betting shoppers will keep paying their higher prices.
CONSTANTLY TRACKING PACKAGES YOU ORDERED WEEKS AGO? FRUSTRATED OVER SHIPPING DELAYS FOR THINGS THAT USED TO ARRIVE QUICKLY? WONDERING IF YOU SHOULD BE ORDERING CHRISTMAS PRESENTS LIKE . . . NOW?The massive labor shortage is now leading to massive cargo delays and shortages within the supply chain. The government is advising people to begin buying for Christmas early and even stock up on food. Gas supplies are running short in some areas. Shoppers across the nation are seeing shortages in stores. Many are reporting that food staples are in short supply. The situation continues to get worse. What can be done? How bad can it get?Supply Chain Analyst// holds a Masters Degree in Systems Management // CEO of Patriot Rail, a major operator of rail logistics in North America JOHN FENTON
Change of plans. You're chillaxing with your favorite part-time friends on The World's First Quantimino™ Powered Podcast recorded in the Beaded Curtain District especially for you and everyone you know. Double X Quantimino. Zero spending days are a myth. Band logos. The new Batman movie: The Batman 2019 film Lighthouse Chilledcow lo-fi hip hop on vinyl Bomb Queen Perspectives: Taking a shit on the clock Burrito updated his 6-disc CD changer. Let's taco bout it. Thursday - Full Collapse Strung Out - An American Paradox Coheed and Cambria - Good Apollo I'm Burning Star IV: Part 2: No World For Tomorrow Rage Against the Machine - The Battle of Los Angeles Gorillaz - Demon Days The Mars Volta - Deloused in the Comatorium Arthur the Arbiter: Sandwich shop drive-thru This Is The Newz. Man orders 100 tacos on first date, asks woman to pay for them Man plunges nine stories from NJ high-rise, lands on BMW — and survives UK Man Wears Fatsuit, Disguises Himself as a Black Woman Before Carrying Out Acid Attack on Ex-Girlfriend Burrito's Nippon Newz. Cup Noodle now has cute cats and judgmental foxes waiting underneath its lids Honda releases official doggy wheel accessories, Shiba Inu shift selectors for your car Food delivery service's payment processing error allows some people to eat for free…for 3 years Furious train otaku in Japan confront foreign bicyclist after he gets in the way of their cameras Kadokawa president apologizes and takes pay cut for his comments about censoring manga More Newz. Shoppers are shocked after learning 'correct' way to pronounce 'IKEA' Banksy artwork that was shredded after auction sells for 20 times its pre-shredded price What I Had For Lunch Unhealthy snacks Deepfake Sponsors: Julio Tejas, Booba Gettz The Crazy One, Thicccum Farmz.
Chicago's Magnificent Mile is currently not safe for shoppers and tourists. Miss France contestants sue the production company for discrimination. Trayon White of climate control fame, is running for mayor of Washington D.C. Patrick tries to tell another joke and Johnny Heidt with guitar news.
Throughout the years, Walmart has brought the idea of the superstore to life. Its name is ubiquitous, most Americans live within eight miles of a Walmart, and within the store, you can find everything from groceries to automotive services to custom paint production. Seriously, there is very little that you won't find within a Walmart. And, on this episode of Up Next in Commerce, Cynthia Kleinbaum Milner told me about how that competitive edge is something that Walmart wanted to lean into as it evolved into the digital era. Cynthia is the VP of marketing for Walmart Plus, Online Grocery and Mobile App, and part of what she does is help Walmart use the power of its retail presence to engage with customers in an omnichannel way, this includes on mobile, which we touched on a lot in the interview. We also dove into Walmart Plus, and how Cynthia positioned Walmart Plus different from the competition, by getting the deepest understanding of what customers want and why. Plus we got into Cynthia's own journey and how she has developed her skills as a marketer to land at one of the biggest global companies ever. This was such a fun episode, I hope you enjoy it!Main Takeaways:Going Backward To Move Forward: The world changes so rapidly that oftentimes the skills you are using now as the main part of your job will be peripheral or inapplicable in just a few years. Rather than continuing on one path doing only what you know, it might be a better long-term strategy to step back and learn in other emerging areas to make yourself more well-rounded. Even if you have to make a lateral or backward move right now, in the long run you will be a much better and a more skilled worker.The Full Experience, Online and Off: Walmart is more than just a grocery store for those who go to physical locations. Naturally, the online experience had to be more than just one kind of shopping experience as well. Creating an app that makes the entire experience of shopping better, has to be the goal. Whether that means bringing in scan and go features to use in-store, or an endless aisle to shop from online, or building in additional services like financial help and delivery, there has to be more to your app so that you are providing customers with the ideal experience.Making Membership Worth It: Too often, brands have membership programs that have one or two benefits that customers use every once in a while at best. But if you're going to have a membership model, you want to make it worthwhile for customers and the business. There should be services that you can't access otherwise, you should be adding value to your customers' lives, and you should always be striving to add features and services that save time and money for your customers, which will make them want to use your app and come to your store even more.For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.---Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Respond quickly to changing customer needs with flexible Ecommerce connected to marketing, sales, and service. Deliver intelligent commerce experiences your customers can trust, across every channel. Together, we're ready for what's next in commerce. Learn more at salesforce.com/commerce---For a full transcript of this interview, click here.
Jorie Waterman, Industry Manager at Facebook, is the featured expert on this episode of the Business, Innovation and Technology podcast. She joins podcast host Jordan Rogers-Smith to talk about how businesses can leverage digital technologies to prepare for the holiday shopping season. They discuss several strategies for adapting to new consumer behaviors and encouraging a smoother peak season for customers and employees. Jorie explains how tactics like pre-holiday sales and pre-ordering options take advantage of natural demand and allow for more time to cope with shipping delays, inventory scarcity, and other disruptions. You'll learn how digital allows brands to build deeper relationships with their customers through empathetic communication and entertaining. Jorie also provides a detailed overview of strategies for using data from multiple sources to evaluate business outcomes. After you listen, connect with podcast host Jordan Rogers-Smith and guest Jorie Waterman on LinkedIn. Keep up with the latest from Facebook's Solutions Engineering Team by following us on Medium.
Welcome to the The Voice of Retail , I'm your host Michael LeBlanc, and this podcast is brought to you in conjunction with Retail Council of Canada. Our second pandemic holiday shopping season is fast approaching. Because supply chains and consumer behaviour have changed fundamentally in the last twenty months, predicting the outcome of major retail events like Holiday is becoming increasingly difficult for retailer marketers. Join me in discussion with Jason Furlano the SVP of Commercial at MiQ, a programmatic media partner for marketers and agencies. Together, Jason and I unpack MiQ's latest study titled ‘The Pandemic Effect: What Holiday Shopping Will Look Like in 2021.' We break down the study's major findings, talk about key takeaways for retailers and marketers as the holiday season approaches. Stick around for our conversation about broader shifts in the marketing space - we cover the latest marketing innovations, breaking down the marketing silos and more. Thanks for tuning into today's episode of The Voice of Retail. Be sure to subscribe to the podcast so you don't miss out on the latest episodes, industry news, and insights. If you enjoyed this episode please consider leaving a rating and review, as it really helps us grow so that we can continue getting amazing guests on the show.I'm your host Michael LeBlanc, President of M.E. LeBlanc & Company, and if you're looking for more content, or want to chat follow me on LinkedIn, or visit my website meleblanc.co!Until next time, stay safe and have a great week! Michael LeBlanc is the Founder & President of M.E. LeBlanc & Company Inc and a Senior Advisor to Retail Council of Canada as part of his advisory and consulting practice. He brings 25+ years of brand/retail/marketing & eCommerce leadership experience, and has been on the front lines of retail industry change for his entire career. Michael is the producer and host of a network of leading podcasts including Canada's top retail industry podcast, The Voice of Retail, plus Global E-Commerce Tech Talks and The Food Professor with Dr. Sylvain Charlebois. You can learn more about Michael here or on LinkedIn.
EP277- Holiday 2021 Preview Holiday 2021 will be one of the most uncertain holiday events in modern retail history. Major disruptions to the supply chain, the last mille, and to consumer behavior as a result of covid, will make this year extremely hard to predict and manage for brands and retailers. Will shipageddon 2.0 play out again this year? Will the supply chain become the supply pain? With Amazon and Target starting holiday deals early in October, and consumer still looking for scarce inventory late into January or even February, Holiday 2021 is likely to be 5 months long. In this episode we break down all the potential issues, and make some prediction about how it might all play out. http://jasonandscot.com Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Co-Founder of ChannelAdvisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing. Episode 277 of the Jason & Scot show was recorded on Sunday October 3rd, 2021. Transcript Jason: [0:24] Welcome to the Jason and Scot show this is episode 277 being recorded on Sunday October third 2021 I'm your host Jason retailgeek Goldberg and as usual I'm here with your co-host Scot Wingo. Scot: [0:40] Hey Jason and welcome back Jason and Scot show listeners, Jason this is a really good time for listeners to pause because we're going to do a deep dive here so that means it can be a little bit of a longer episode. And leave us that five-star review this episode is going to be so good you can go ahead and pre leave us the five star review so we'll wait for second for you to come back. All right thanks for doing that that really helps us out as we get the word out about the show, Jason last year at and I went back and had a one of our many interns look at this and it was exactly this time last year I think was actually October 2nd recording this in October 3rd so it's a pretty darn close. We coined and we were doing our annual holiday preview and we both coined and predicted ship again and that is where we saw pretty early on I think before a lot of the rest of the folks in the industry that there was going to be both a surge in digital adoption due to covid plus the normal holiday increase from e-commerce and that that was going to more than absorb all of the available last-mile demand and that's the why we coined ship again and it happened and it was bad but we all survived and made it through and hopefully the folks listening to this show got in front of that both on their business and personal side. [1:58] Well this year we want to use this episode and do a deep dive into what that's going to look like this year and it's a more complex situation last year was pretty easy to lie to read those tea leaves because you know we were already pretty close to capacity before covid and it was kind of pretty easy prediction to say that we're going to far exceed the ability to deliver the packages. This year we have a lot to unpack for you spoiler alert it's going to be worse than last year much worse because not only is it that last little piece of the whole digital retail chain of events The Last Mile that's going to be a problem but it's all the other pieces leading into it that are going to be a problem something we call the supply chain but this year we are going to call it the supply pain so we're going to peel the onion on this and first we're going to look at the economic setup heading into holiday 21 then we're going to look at the global state of supply chain then we're going to look at some of the holiday trims that are kind of factors we think that are going to tie into this last some of the pontificate errs are out with their forecasts and we're going to go through those and kind of see what we think about those. Jason want it could suck kick it off with the economic setup coming into holiday 21. Jason: [3:15] Yeah awesome Scott so first of all let me start by saying on the macroeconomic picture most of the professional analysts that look at this. Are pretty uniform in feeling like the consumer is generally in a good place that the economy is in a pretty good place and they are all very bullish on the consumers ability to spend this holiday. And I say that because my own personal feeling is that there's a little more uncertainty cooked in there there certainly are some encouraging favorable things. And there's a few worrisome things and I think. What's going to become the theme for all of these sections we talked about today is there's a significant amount of uncertainty there's a lot of things that could swing either way and have a dramatic impact on holiday so. It is what it is but. Sort of giving you how I look at the macroeconomic situation the first thing we'll talk about is inflation and there's a bunch of ways to look at inflation but a simple one is there's this thing called the Consumer Price Index which kind of. Factors in how much of each good consumers purchase and how much prices are raising for that, and the the CPI is it about 5.25% right now so that's pretty significant we more expensive Goods that consumers are having to pay. And ordinarily that inflation can be problematic for the economy a couple of things to know though. [4:43] If you kind of look at the shape of that CPI it actually is going down a little bit from a peak in July and so possible we've seen the. Peak of inflation and it's starting to come back down. Inflation is a mixed bag for retailers and holiday because they get more money for everything they sell they tend to sell less stuff but make more on each in certain circumstances it can be more profitable. Um but you know the goods are costing more we've got this 5.25 percent inflation. We also though have a pretty significant increase in wages so people are getting paid more for their work, particularly low-income people, are getting paid more for work retailers and warehouses and all kinds of companies are having to raise their wages to compete for the for this labor force that's been hard to find right now and so, wages are going up and in general the analysts would call those two things Awash that that consumers. Are getting bigger paychecks and they're having to spend more on their necessities and that at the moment that's about Break Even so two interesting things to know. [5:52] A kind of predictor of future spending is this this huge survey that University of Michigan does every month the consumer confidence index. And when when we were kind of in the peak of recovery from the first wave of covid-19, that index was a leading indicator that said consumers were starting to feel good about the economy and it hit like it's this index it over a hundred today it's sitting at 71, which is the lowest point since January of 2019 it's not, like a historic low or anything like that that you know you go like oh it's way below normal, but it does appear that consumers are in general feeling less good about the economy than they were, um you know just a month or two ago now there's a bunch of political news out right now and there was fear of government shutdown that we've already averted and those kinds of things have a big impact on the consumer index oh. [6:49] Um I that consumer index doesn't have a perfect correlation with spending so I don't spend too much time thinking about it but just to know, that's a number that had been favorable and is kind of shrinking down. A big one we talk about is unemployment because people don't have jobs it's hard for them to spend on Goods obviously at the beginning of the pandemic we had a huge spike in unemployment, unemployment is actually pretty good right now we're at five point two percent. The kind of pre-pandemic average was about four so we're not all the way back to pre-pandemic average but that pre-pandemic. [7:22] Point was a historic low so historically 5.2 percent is pretty decent for unemployment. Um so like most most analysts would say that's a favorable indicator the two things to know there is, that's based on the people that are seeking jobs and not getting it there actually is a ton of people that kind of took themselves out of the workforce we. Fully understand where all those people went but a big chunk of those people were second incomes for household so like a lot of women. That like maybe don't have as good a help childcare as they had before or more school challenges or things and so they haven't gone back to the workforce and many of them are seeking work so they don't show up in the unemployment number so. Just be aware like household incomes are somewhat stressed because of that factor and then as we've talked about before on this show like as of July. People that make over $60,000 a year the unemployment is actually ten percent better than it was before the pandemic so they're doing great. And the low-income people that are making less than $30,000 a year their unemployment is still 21 percent lower than it was. The beginning of the pandemic so so a little bit of a bifurcated recovery on the jobs thing. [8:38] One of the reasons that we historically have that we had high unemployment was because there's all these rich benefits this enhanced unemployment benefits that people got that all expired last week. So if people were staying at home because they could make more and unemployment that that justification probably ended. The bad news is that ended in 26 States over two months ago and in general the data shows that people did not rush back to work when it ended. So there's not necessarily a reason to think a ton more people are going to rush back to work now that that it's ended everywhere but we'll have to see. Um the other macroeconomic things all these natural disasters are negative to the economy so you know when hurricane Ida takes a hundred billion dollars out of the economy that's a bummer. Um [9:25] Another hugely favorable one in the one that most of us are hanging our hats on that are looking for a good holiday is the savings rate and this is the most unprecedented recession of all times. Unemployment you know went way up at the peak of the pandemic but so did savings which has never happened before, and part of that was because we had all this stimulus money we were pouring into the economy but the savings rate normally hovers around 8% it shot up to 32 percent during the peak of the pandemic, it's way off of that Peak it's a nine point six which is still a little higher than it was before the pandemic and that. All that extra money that a lot of household socked away because they got the stimulus and they spent less during the the peak of the pandemic. [10:18] Arguably puts consumers in a good place to spend for this holiday the counter-argument would be all that stimulus. Is mostly over there still are you know very lumpy employment situation and a lot of that savings has dwindled, um so we'll see how it goes, um but then the last fact I'm going to throw up before I go at Scott get a word in edgewise is that the stock market has done phenomenally right and, we're way up from the pre-pandemic level and so the investor class and people that have you know as a meaningful portion of their wealth. Tied to the market. Did terrific right and so if there is economic uncertainty and instability in this economy it's bifurcated and it's the lower-income people that like do not have equity in the stock market. Um there were her but roll all that up and the the professional analysts feel like. Macroeconomic situation all to all in is pretty good and of course when rich people do well that help certain sectors of the economy quite a bit right and at the moment luxury and jewelry are doing phenomenally well for example so. That's kind of my snapshot of the macroeconomy Scott anything you'd violently disagree with or anything you pay particular attention to. Scot: [11:45] I think I think that's right I think you know there's a lot of folks that feel the inflation the CPI isn't the right inflation number it's kind of this old metric. This basket of goods and doesn't capture a lot of things you know there's, I follow a lot of the crypto people and, so there's been a huge wealth creation through crypto and that whole world which is kind of interesting and then you know there's there's a feeling that the FED has pumped so much cash into the system that is just sloshing around and kind of crazy ways which is why you saw that savings rate kind of go up as high as it did and you know they're they're talk track goes that that's why we're not seeing as much employment where folks have taken so those free free dollars and and you know. Done something with it so that they don't need a job now or they're going to be less likely to enter the workforce but I think at all. Yeah I would say I agree with the analysts on that it's going to be a pretty good holiday. [12:51] But I think the problem we'll get into that as I just don't think there's going to be a thing to buy so I don't not sure if it matters. Jason: [12:56] So step one American families probably have some money to spend okay so now as we've already alluded to the next challenges what is the supply chain look like and what could they spend it on and Scott what's your kind of read there. Scot: [13:13] Yes Supply chains from those things we always talk about but then you know in in your mind you have this kind of linkage these things linked together I remember as a kid when you would cut out the little construction paper strips and make the little chain to go around. The holiday tree there II reminds me of that and we kind of vaguely talk about it as this big, big thing and we want to really unpack it on this episode so as a summary you know there's when you make a product let's say it's one time in a million familiar with right now is a vehicle that which is one of the more complex products or even a. You're relatively simple product like an electronic toy or an apparel item or almost anything it's going to have first of all it. It's going to have component parts right so there's going to be some form of pieces that go into that I kind of mentally think of them as the Lego blocks that make up that item so if it's a cool trendy trench coat there's going to be obviously fabric buttons may be a variety of fabrics and things like that so there's generally it's hard to make any product without there being at least 10 inputs and then many times, thousands if not tens or hundreds of thousands as you get into like iPhones and vehicles and stuff like that. [14:33] So that's important to remember is each one of those component parts has a supply chain right and you can't make a widget until its component pieces are all there so what happens is we're seeing this really interesting and it's hard to know the root cause or theirs some of the economic stuff you talked about is part of it we're we're just having labor shortages that cause things but then you know we'll talk about some of this there's we import a lot of our goods from China and they're having all kinds of issues of their own there's covid related things non-covered related things but generally let's think about the supply chain and kind of the broad sense of you have typically the bulk of goods are made offshore some of them are are made on Shore but let's kind of assume in this example A lot of these products are coming from offshore or at least income the many of the components maybe there's some assembly in the US but at least the the components for a any widget are made offshore so that's number one so that has to be made in a factory somewhere and then shipped here so there's the port of origin so it leaves a port in a foreign land and then needs to come on its way to the United States for a consumer to buy it. That Journey can go a variety of different ways will to it can go by boat or air, the standard way that products are moved is through containers so you by everyone seemed these containers there's all these cool. [15:57] We just opened up here a restaurant container Village kind of a thing so you have those containers their specialized boats that carry these and and or you can put them on airplanes. So then they get on a boat let's say the bulk of products do go by boat there is some by are then they have to go over the sea and then they get to a destination port so there's you know there's two ports involved with every product that comes across in a container then it has to be unloaded from that boat you've probably seen these giant cranes somewhere. [16:29] Fun Star Wars fact those are the that's where George Lucas got the idea for at-ats he saw some of the cranes and one of the ports on the west coast and thought of what if you had a giant walking robots that look like that so those have to be unloaded and then typically you're going to put them on either so then when they get to the United States in one of the ports they're going to be offloaded onto either a truck and then part of the truck that's really critical in this is called a chassis so if you've ever seen you've probably driven by a million of these container trucks but if you take the container off that's the chassis part as you've got the front part of the truck, then you've got the chassis which holds the container and then the container sits squarely on there it's pretty clever if you think about how it's all been designed or that same container can be put over on rail so there are specialized railroad cars for carrying containers and then and then the product goes on its way then it makes it to a warehouse and then it goes to from that fulfillment center it gets distributed many times do a couple maybe from a big kind of inbound fulfillment center to some regionals to some locals and maybe even one step closer to kind of hyper local and then it gets into the last mile delivery part of the world so it gets onto the virtual shelves and then is sold and goes into that last month so [17:52] There's there's a lot that has to happen right in there and we're going to go through some of the things that are not working right now and you know like any any chain any. There's at least common denominator problem so all that can work great and if you don't have Last Mile Vehicles then you've got a problem or, the factories aren't making things fast enough then the whole chain is compressed and you've got this other set of problems and you know where we are now is almost every single part of that chain I just walked through is is kind of you know sport or in a bad situation right now and we'll take you through some examples. Jason let's start with factories what's going on there. Jason: [18:34] Yeah well a couple challenges with factories so obviously the we have the most factories in China and the good news with China is. Covid is mostly under control they definitely have had a. A spike from from Delta they almost had had down a zero before Delta. [18:55] Because of their their concerns about the the virus they have China has what's called the zero covid policy and what that means is. If they have a single case of covid they will they will shut down an entire business or. Even a sector of business so while there's not huge outbreaks of covid and factories right now. There have been a bunch of examples where only a few cases of covid showed up and that caused a factory to be closed for two weeks so there there have been some disruptions with the Chinese factories. But the bigger problem has been that it, from before and in the very beginning of covid a lot of manufacturing got Diversified and moved out of China right and so the second biggest manufacturer of apparel behind China right now is Vietnam. Vietnam has had a lot of trouble with Delta and about a third of the factories in Vietnam are shut down right now so a lot of the factories that make goods are not making as many Goods either because. [19:56] They don't have very good access to vaccines and they're having covid problems or they have really rigid government policies like China. And then forecasting a future problem that's a huge Debbie Downer, is China is actually experiencing a real energy crisis right now and China always has to kind of, ration electricity and they give quotas at the beginning of every year to these factories and factories often have to shut down because they exceed their quotas. Well this year like they have less. [20:31] Energy capacity in China for a variety of reasons in the cost of coal has gone way up. Um there's there's fixed pricing for for energy in China and said the producers can't charge you more even though the cold cost more and so they have less incentive to make it which means there's less energy and so there's a lot of fear that there's going to be a ton more slowdowns of Chinese factories because of this looming energy crisis so all of those things. Our kind of conspiring to make like the amount of product available from the factories like. Significantly inconsistent and hard to. Scot: [21:12] And then say the call thing and because I have read a couple articles on this and I haven't under Center so they're in an attempt to be green they've lowered the price of coal so cold manufacturers have stopped making goals that. Jason: [21:26] So I think that's what the the green thing has a significant impact here but the the communist country they set the the. It's a. [21:37] The energy industry is a tightly regulated industry and so the prices are fixed so that so the government decides the beginning of the year what the price of electricity is going to be. [21:47] So then these factories are only allowed to charge that price or plus or minus 10% of that price, and coal is four hundred percent more expensive so a lot of factories don't want a lot of power plants don't want to make energy electricity from coal right now because they can't do it profitably, they don't have permission from the government to charge for hundred percent for their electricity but they're having to pay 400 percent for their coal so. There is less production because of that it is also absolutely true that China has some, zero emissions by wants a 2060 things and they have concrete milestones in place every year and so even before cover that constrain how much electricity they were going to be able to make this year with current production means. And it meant that factories had a quota, um and and often that means Factories do periodically shut down when they use up their quota factories are rushing to get more efficient so they're all its, it's like everything it creates all these Downstream effects whatever equipment you use to make your stuff there's probably a more energy efficient version of that equipment that you now want to buy. But it's hard to get your hands on so all the factories are competing for the more energy-efficient versions of all this this materials, but the it's likely that more factories are going to be shut down for longer this year than ever before because of energy shortages. Scot: [23:14] And I saw an interesting graphic I forget I think is there Bloomberg or Wall Street Journal where the government then said well if you're going to shut down energy they created these zones and they put like a lot of that Apple manufacturing plants in The Greener zones that we get more power but then they neglected a lot of the input parts so. But the factories that can make the iPhone 13 or operating but they're sitting there idle because the the red zones that aren't getting a lot of power or only able to run like half a shift are. Jason: [23:44] Per your point like even if the Lego factories allowed to make Lego castles if they're not allowed to make red blocks. It's tough to make a lot of weight so castles so that that is yeah. It's a mess and then to give you an idea how cute it is normally they only shut down the the industrial areas there's so much constrained energy now that they're starting to shut down residential areas so people are. Are like having their power in their residences turned off as well. Scot: [24:14] Interesting and then I've been tracking ports here in the US very closely but what are you seeing at ports of origin in other countries. Jason: [24:24] Well this is one we're very publicly this zero covid policy that China has instituted has come into play. So that that all the biggest ports in the world are in China the third largest port in the world is divided into four terminals one of the four terminals was just shut down for two weeks because of a single. Positive test of covid and so that again to the extent that the factories are making stuff and they need to load up all those containers, um if they have to stop loading for 2 weeks that that creates a real lumpiness in the in the supply chain and that is a particularly hard thing to predict right like if you're just saying like oh man of. Factory you know has a bunch of sick workers it's going to shut down you can kind of watch that and see it coming but what you can't see coming is, you know a very small number of cases having a very material impact on the supply chain like these these ports that are shutting down and so the. The those impacts are sort of outsized on the supply chain at the moment. Scot: [25:34] Yeah and then so so now we've got our products you know, if they can make it through this Gauntlet that we've already laid out they're going to get on a boat and they are going to go get packed into a container and there's a fun if you're a business you're trying to get as much of this product into a container as possible because it's pretty much all you can eat once you once you buy a container there's fractional containers whatnot and because of there's a shortage in containers and then the cost to send these containers has gone way up so right now as we record this the cost there's actually an index you can look at this so if you were will put a link to show notes but if you Google Freight Fredo's fre IG HT o s index there's an index that tracks this and we have hit a record of 20500 86 average dollars to send a container and that's twice what it was in July of this year and that was twice of what it was in January so we effectively you know in July it was about ten thousand dollars and in January as about five thousand dollars now another interesting Factor here is depending on how many units you put in a container you divide that that unit cost right so if you're putting I'll keep the math easy a thousand units in one of these containers which would be something relatively big you're going to you know you just added effectively another. Yeah. [26:57] Let's see I should have smelled your $15 to the product just in kind of Landing cost with this with this increase so whatever your cost is on a per unit it's gone up effectively 4X since January so that's a factor to consider. [27:15] And what I'm what I'm hearing from people on the ground is you'll go bid and you kind of get get in front of this number right now so you're actually out there bidding today 30,000 to get a container and then you think you'll have one and then they'll say oh you know we need to re-evaluate that because they can the shipping company I'm talking to is now saying is 33,000 so there's this like running auction to get. Space on these boats that are coming over because of some of the rest of the supply chain that will talk about so. [27:46] So how about are so that's that's what it looks like by boat what are you seeing on the air side. Jason: [27:51] Yeah and obviously the most cost-effective way to get all this stuff here is via boat so you'd prefer to do that but when the boats aren't available or if you you need stuff considerably faster like a, in Good Times it takes about about 40 days to move a container from China to the west coast of the US so. Some Goods do come via air and little known fact 50% of Air Freight that comes into the u.s. comes on the bottom of, passenger airplanes right so it's not it's not FedEx and UPS planes flying from China to the US cargo planes it's, it's the bottom of these passenger planes and guess what is not happening right now is. International so there's just way less flights and said there's way less capacity for this Air Freight and so both, because there's more demand for Air Freight because of all the problems with the ocean Freight and because there's less Supply that the air option has you know been dramatically diminished from where it would normally be. Scot: [28:56] Yep so then so then you decide okay well I've got to put on a boat you do that you wait your 40 days and then what you find out is your delayed for a very long time because the heart problem is the u.s. ports are all pretty much maxed out so we've kind of done this very big under-investing in our ports so one of our our biggest one is in Los Angeles at Long Beach and then we have Savannah New York New Jersey and then there's a lot of secondary and tertiary ports but those are the big ones and there's another index that Bloomberg, puts out which is effectively the number of boats that are anchored offshore and you know what you want to you never want to Anchor these things because effectively they're just sitting there all that product just sitting there you know. Doing nothing waiting and the reason the reason why they're sitting there is the ports are they can't unload the products fast enough. [29:55] There's a million reasons why we'll talk about that in a second but this just actually ticked up over there's over 40 boats, and this is interesting I've read a data point this has 74 Los Angeles and 40 I think there's 40 anchored in 30 actively kind of being done there's these Maps if you look at my Twitter feed I just tweeted one to just show you know the port and the congestion there's just all these boats just sitting there waiting to come on shore I have a friend that lives in LA and they can just as they drive around they can just see the boats out there just fact it's very unusual time frame. Jason: [30:30] One of the supply chain guys I work with suggested that we should start a new company Uber barge where we deliver like In and Out Burgers to all these boats that are stuck offshore. Scot: [30:39] Someone someone tried to actually get a helicopter to go out one to get their container often. You can't do that because if you've ever seen these things are stacked like 50 deeper someone is crazy you can't just say I really need that one right there so this this index just ticked over 70 for the first time ever since has been created which is just just crazy. [31:00] And so why is it taking so long to offload the boats well we have under invested in these things and then we have this discontinued problem with the supply chain. Number one there's not enough people to I think it's longshoreman there's a lot of these Union type jobs that you hear about that do this so there's a longshoreman or the ones that offload products for a long time due to covid they were only running like half the number of shifts that used to so they have actually spun that up, they're running more shifts but now there's a shortage of chassis and then because of that. [31:37] You know if you don't have chassis you can still off load the boat but now you have to put it into kind of medium term or short term storage and then all that is full so there's not enough chassis there's not enough truck drivers if there is chassis and then if there's not chassis all the storage is full and then, the one when a product comes off the boat at the Port it can either go by truck or rail the whole rail system is all jammed up as well the this is interesting I read this one article that. Near you in the Joliet train yard which is one of the biggest ones in middle of the country they're so jammed up they have over 8,000 containers stacked there waiting for more training capacity and then some some days the trains are backed up for 25 miles waiting as they're loading these containers on there to try to do this, normal turnaround for a chassis to go at a port to deliver something to where it's going and come back is three and a half days due to all these various shortages that is extended out to 17 days so that's pretty crazy. A big factor in this port jam up is also the shortage of drivers and I call them CDL Drivers which is a commercial driver's license. [32:49] To drive one of these 18-wheelers that's going to carry a container you have to have a you know a certification for a certain type of vehicle there's It's relatively, no time-consuming to go get the certification and the number of drivers that have this is actually decreasing over time as they age out and enough people are coming into the profession so I read one article and this was by one of the one of the professional groups of CDL drivers that there's about 240,000 shortfall of CDL Drivers compared, kind of where the demand is there's about you call it to and 50,000 fewer drivers than they need so we're seeing you know I think I can remember was you or someone but Amazon and Walmart are ineffectively gunfighter these people where they're charged their they're paying crazy signing bonuses and hourly rates and salaries for any kind of truck drivers and so because they're the biggest. Employers of these things they tend to have the better economics and its really starving out other parts of the market as they absorb all the available CDL drivers. Jason: [33:57] Yeah that Walmart's paying a hundred and for a new driver $160,000 a year and eight thousand dollar signing bonus. Scot: [34:04] Yeah yes it's not uncommon uncommon thing to see out there it's pretty crazy, so that's what's going on at the ports it is a hot mess on this side as well so even if you are fortunate enough to get your product here to the US then you know you're looking at probably an extra 40 days I think is kind of you know what everyone's saying right now and that's average it can take a lot longer the LA Port is so jammed up that people are are they're rerouting you know rerouting boats across the sand getting them to other other ports but there are no like there's one in Georgia and it's the Savannah one and it's getting backed up I just saw they authorized building this this kind of effectively opening up a big giant parking area to put containers and that's going to give them some more storage capacity but you know where if you add up those, here we are you know in October and you start adding these things together the the holidays pretty much baked at this point right there's you maybe have 15 to 20 days of window here for stuff you already ordered. 80 days ago to kind of get here but none of this stuff is going to get fixed fast that's going to be part of the problem. Jason: [35:17] Yeah yeah if you follow the earning calls like Nike for example like dramatically lowered their guidance and they said Hey look it's it's cost four times as much to get a container of shoes here and the container takes twice as long to get here, and so we're just not going to have the supply to hit our original guidance and and Nikes better this than a lot of other people so it's a. [35:41] Pretty prominent problem and then there's all these secondary impacts right so you mentioned the math of the container right like you'd like to fill up that 40-foot container with Goods if your goods only take up 90%. Ordinarily you'd put someone else's Goods in the last 10% to try to make it more. Cost effective and efficient and share those costs but when the unloading is so gummed up what you don't want to do is have a secondary process where that container comes off the boat has to get re packed your stuff goes One Way their stuff goes another way, so people are actually shipping containers less full than they normally would which is entirely counterintuitive for what you would expect. The boats are all slowing down because they can use less gas to come here and 80 days then to come here in 40 days because there's no place to unload them. Um and the the supply chain guys I'm like we've been helping a lot of retailers hire truckers lately and they kind of summarize it real simply like the average commercial truck driver was 55 years old with multiple comorbidities a bunch of them. Retired and all the trucking schools that can teach people to get these licenses shut down for covid so there were no new licenses being issued for like. [36:54] Year and so there's just this this huge acute problem. And then you know without those truck drivers with the train problems and Barge problems of your on the Mississippi there's just like no place to move all those goods. You mentioned people are moving the boats from from some ports to secondary ports. That helps somewhat but the biggest cargo ships can't even fit in these ports right so I Long Beach the one of the most advanced Sports we have certainly the most advanced on the West Coast, um [37:27] Can't take the two biggest class of ships it can only take the third biggest class of ships and then as soon as you divert that ship to Portland instead of Long Beach. The the that class of ships won't won't fit there and so like there's there's a limited option to just move the stuff around so we're just we're gummed up like never before and most scary of all Gap and their earnings call kind of said like Hey we're loading our guidance and we're going to very lumpy inventory and we don't see any alleviation of these inventory challenges until at least 2020 3. Scot: [38:06] Yeah in the Auto World we're having a huge problem here where there's a chip shortage and then. [38:14] Another problem is you spend down these factories they don't just get spun back up because all the component parts are you know they stop ordering them and then those factories and everything so so even as chips are starting to come in a lot of vehicles can't be made because there's some other component that now is stuck in one of these containers that that were talking about I read this other interesting article where Coca-Cola has several of their bottling facilities that are down waiting on replacement parts so they went and basically least 20 or 40 bulk ships they didn't even worry about getting containers and they just jumped onto those ships the pieces they need to make their factories work and and are bring him over in this kind of crazy never done before way for a big company. Jason: [38:58] Yeah and I guess that that's one last point on this supply chain thing. It definitely is favoring the biggest players in every industry right so if you're the you know the biggest receivers of goods in the US. You're still being impacted by all of this but you're first in line for what capacity does exist and you you mentioned the games that the Brokers are playing with the price of containers that's going to happen a lot more to the independent shipper than it is the you know number one or number two shipper for that port and so. Well this this is a pain for every retailer in America it's going to be less painful to Walmart and Amazon then it's going to be to the, the medium-sized specialty retailer for. [39:49] And I was just going to point out I think you saw this as well as got but like Salesforce kind of put together a holiday forecast and they looked at all these supply chain problems and they're estimating, that this is going to add about 233 billion dollars in extra supply chain cost to holiday sales for the US so that's. Going to come like straight out of margins basically or or drive more inflation. Scot: [40:13] Yeah that's for the products to get here there's this another side of that equation where which is the opportunity cost right because you know. There's not gonna be a lot of exciting merchandise on the Shelf so we're what's opportunity cost of that we'll have to kind of. We'll get to that I guess we talked about forecast so what what holiday behaviors are feeding into this. Jason: [40:34] Yeah so tricky this one is there wild swings both ways right so you think if you remember at the beginning of covid there. Fundamental changes that happen people spend a lot less on travel they spend a lot less on restaurants they spend a lot more on their homes and they spent a lot more grocery stores right and so then as, people got more comfortable as people start getting vaccinated as infection rates are going down we started seeing all those things swing back right and you started seeing, a lot more bookings that are being be you saw a lot more Airline reservations you saw a lot more traffic coming to stores and you certainly saw a lot more people going back to restaurants. Then Delta hit. And we saw a dip again and people started returning to the the the kind of earlier covid behaviors not as dramatically as the first wave. [41:25] You kind of had a second wave and so predicting which of those, behaviors are going to be at the at the peak for holiday is really hard right now so retailers are looking at consumer sentiment and Doug mcmillon in his investor call he's like hey. Our consumer has told a strongly they want to have a normal holiday that they want to sit down with their family and have a meal, they want to travel they want to do the normal things and there's a strong desire and that if it is remotely safe they will do it and Doug's I kind of under his breath comment was. [42:05] Even if it's not safe they're probably going to do it right so, his viewing is there's there's so much fatigue in all of these like covid change behaviors that were going to see a significant return, you know closer to pre covid behaviors but you know we are we are seeing some signs go the other way, in the u.s. store traffic never fully recovered we are still down about ten percent versus pretty covid levels in China store traffic totally recovered and then Delta hit and store traffic drop back down, 30% below pre-pandemic levels and so since China has historically been about 4 months ahead of us. That that would predict that we're going to see another drop in. Um store traffic which again doesn't mean people won't spend it means they're going to buy more online instead of in store and that exacerbates all of The Last Mile problems that we talked about last year and we're going to talk about it. [43:09] Again this year so it's really risky to predict. What's going to happen with the coded behaviors people were starting to buy a lot of clothes again after having not buying clothes in here and now the closed sales are slowing down and then we talked about. Apparel is one of the categories most impacted by all these supply chain issues so there just may not be close to buy and so really hard to predict that stuff. Um but what I can tell you is retailers now have a couple of reasons to desperately get you to shop earlier right one reason is they're not going to have very much stuff and they don't want to be the Grinch that caused you to miss Christmas so they desperately want you to come in early, and give yourself the best chance to get the stuff you want so, the every retailer is more loudly than ever before trying to incentivise and entice customers to shop early. [44:03] Also if this ends up being another digital Christmas where people shop a lot more online than they do in stores, we have a huge problem with the last mile we don't have enough capacity in FedEx ups and u.s. post office to deliver twice as many packages over holiday, and so we need to spread that those those orders out over more days and so for all of those reasons we're seeing retailers start their sales earlier than ever so. To kind of paint you a promotional picture Amazon Prime day normally is in summer it historically celebrated Amazon's birthday which is in July. So then the pandemic kids they can't have a July sale so they have an October sale and it went really well. So this year they went back to Summer but they went to earlier summer they had the sale in June and a lot of us think they did it earlier in June for one of two reasons either they hate their own C fo and wanted him to have to talk. On earnings calls about the sale being in a different quarter every year for the last three years or. They were having a sale earlier to make room for a second big sale they intend to have this year during holiday to kind of repeat the success of. [45:11] Of holiday Prime Day last year and we haven't seen any all the announcements yet but Amazon has already announced a 30 day. Beauty and personal care sale starting in October of this year Target match that and said hey we're going to start our deal days in October, and we're price-matching for the whole holiday so if if you don't believe us and you think we're just making a joke about these early sales and you think there's going to be better sales waiter know if you buy it early will guarantee you, that will match any lower prices that you see anywhere for the rest of holiday so targets leaning heavily into that. And we think most retailers are going to launch their sales. Earlier than ever before to try to pull in these these early Shoppers because of all the supply chain and inflation issues. The sales aren't going to be as good as they usually are like that what used to be 40 percent off is going to be 25% off but what deals they do have are going to be earlier in the year to try to drive those, those sales earlier. [46:21] And people aren't going to get everything they want they're going to be limited inventory and so what's going to happen people are going to get more gift cards people are going to celebrate the holiday later and we're going to sell more stuff in January January is always a good holiday month anyway but January is going to be disproportionately large this year because of the lumpy supply chain think so, if you think of holiday as generally like being a strong peak in October between that that the kind of turkey five, this holiday more than ever before that spending starting in October and is going to last all the way through January. Scot: [46:58] And then as we get to the last mile we're definitely have another ship again so we've got we haven't increased our capacity hardly any because you can't really buy Vans and the everyone's renting Vans and there's just this fixed number of biliary vehicles and if we're going to have this Less store traffic even more e-commerce than last year even if you throw you know maybe. [47:23] Low middle digit low single digits on there like five or 7% or something well we effectively had 98, we can only deliver like 97% of the packages last year so it's going to make it a now will only be a little deliver maybe 90% of the packages so it's going to be really tough delivery, set up coming into the holiday. Jason: [47:46] I think the like some data points I saw the that are alarming like so number one. All the Fulfillment centers have an average turnover rate of like four hundred percent a year right so they're having a hard time hiring people and keeping people. FedEx in their earnings call said that like we just can't staff some of our distribution hubs so we're having to reroute packages in a less efficient manner, because for example we only have sixty percent of our labor force in our Portland Hub right so ordinarily they would try to, be at a hundred and twenty percent of their labor in these hubs for holiday with all this seasonal labor and this year. [48:24] They can't even fulfill all the permanent jobs they have so there's not going to be a seasonal Flex. For the main carriers you know the Retailer's do a lot of seasonal hiring for stores but they're prioritizing the seasonal hiring for their fulfillment centers over the stores because they're so. Worried about enough labor to fulfill all these packages and then you know when when FedEx and UPS have less capacity. What do they do they smartly charge more for it so we've seen gas surcharges we've seen holiday surcharges and and they're now announcing their rate hikes for January and FedEx announced the largest rate hike they've had in the last ten years so on average, it's almost six percent as 5.9 percent rate hike it varies wildly depending on the class of service so some kinds of shippers are going to get hit much harder. Um and just like last year all of the the big shippers have a quota and they're not going to be allowed to ship more more packages. The maybe one silver lining in this is that. Because readers are likely to be more successful in spreading the demand out this year than last year that's going to help a little bit and. [49:37] As a as challenges everyone's going to be with the capacity last year there were political challenges that that particularly got the US Post Office sideways which is a big part of this whole chain. And they don't anticipate that that will be as bad this year and so there is absolutely going to be ship again in 2.0 this year with the, the The Last Mile but the most of the analysts I'm talking to are saying the first mile is going to be so disrupted this year that the last mile is going to seem. Less severe in comparison whereas last year the the holiday challenges were all about the last mile. Scot: [50:16] Yeah and you know the double-edged sword of there not being enough product is maybe there just won't be enough product and it won't you should be getting but if whatever there is is going to get jammed up I think. Jason: [50:29] Yeah so that's a great transition to so like that's a lot of Doom and Gloom what's going to happen for Holiday should we all be shorting the retail stocks like what's. What's going to happen. And spoiler alert I don't know well we'll talk a little bit about our educated guesses but maybe before we do we can walk through some of the the forecast from the the brave souls that have been willing to share their holiday forecast. Scot: [50:56] Yeah the one the one I saw was from Salesforce and they, they say that e-commerce is going to be up 7% versus kind of that huge surge last year which was like you know fifty percent so they're coming in kind of with a moderate 7% growth which which is done yeah I think that would be the probably the slowest e-commerce growth since 2008-2009 yeah. Jason: [51:24] 2008. Scot: [51:26] Yeah that's that's the one I was tracking and you know when I read through the bullet points it made sense they're definitely putting a pretty wet blanket on things due to the this kind of quote-unquote Supply pain. Jason: [51:38] Yeah and it is tricky so they were the only one I've seen that's done an e-commerce forecast right and I would say that's the most uncertain because. Of we just don't know whether people are going to go back to stores or whether they're going to be worried about health and ordering online when they start having constrained. Um supplies is that gonna. Push them to online more because they can hunt more places or is that going to entice them to go to the store because they can use their eyes to see the inventory for themselves like there's, there's a lot of variability in that e-commerce number but I would remind people even as low as 7 percent sounds its. 7% on top of the huge bases from last year right so it's it's that's not a decline in e-commerce by any means that's a slowing of the increase just as a reminder for. People. But then I did see several like of the other the kind of traditional Consultants put together an overall holiday forecast right so beIN predicted that they were going to they thought holiday was going to be up seven percent from last year. [52:45] Deloitte said that they thought holiday was going to be up between seven and nine percent from last year. And MasterCard said they think holidays going to be up 7.4 percent from last year so. To put all three of those numbers in context those are all huge numbers. Um last year was the best holiday year in 10 years and sales were up 10% but the average is about 6% so saying we're going to grow if. You know these three things kind of all averaged out to about seven percent growth if we're here we go. If all holiday store an e-commerce gross 7% on top of the ten percent from last year, that's a phenomenal holiday and so that says, that these guys are pretty confident that the consumer is going to spend even if they can't find exactly what they want right that the supply chain is going to be painful but that the all the macroeconomic stuff we talked about at the beginning is going to win out and consumers are going to spend a lot of money this holiday I. [53:49] I want to believe this I'm going to be pleasantly surprised if it plays out like that right and my um, the the one caveat I'll say is that us retail is incredibly Diversified right and so for every category that's going to get shellacked by the supply chain or by changes in covid behaviors. Some other category is going to benefit right and so. It is true that the holiday could absolutely hit these numbers like I'll remind people that cars are 25 percent of retail sales gas is another huge chunk of retail sales. Some of these forecasts have those things in some don't some of these forecasts are for November and December some are for November December and January like everybody has a different definition of retail and a different definition of holiday so, you can't really apples-to-apples any of these but I pulled all the US Department of Commerce data and again last year November through January 10 percent growth, average of the last ten 10 years is about 6% growth so 7% growth is a. A terrific number and. I don't know I could see it happening if it happens it's going to be because there was a we had the most Monster January ever because I just don't think there's going to be enough Goods on the Shelf in November and December to do. Scot: [55:17] Yeah I'll take a so I think the winners are going to be the companies that have the most power and smartest supply chain operators so I think Walmart and Amazon. Maybe Target I don't know them as well do they have a you think they feel like they have a pretty dialed in. Jason: [55:33] They Walmart and Target both in their earnings said like look our inventory isn't going to be isn't where we want it it's not going to be where we want it but we we in general are feeling good and neither one lowered its guidance for holiday in their last earnings call so they both felt that they were going to weather the storm but you know below that you go look at like a Bed Bath and Beyond and they're like look there's no way we can hit our numbers with the supply we're gonna get. Scot: [56:00] Will they miss this quarter and if you miss this quarter you're just going to get worse the next quarter Seth. Jason: [56:04] Exactly exactly. Scot: [56:06] It's a poop storm now and it's gonna be a bloodbath and in 90 days yes I think I think if I kind of do the calculus on that I think those three guys win I think everyone else is net negative and. You know I don't think those three are big enough let's say they represent Amazon's kind of half of e-commerce only think about e-commerce the rest of retail is. That's your bailiwick yeah Amazon's half, yeah I could see it being flat to down five percent because. Amazon Walmart and Target doing decent isn't it be enough for to make up for the whole that it's created there so yeah so that's kind of, where I see it it's going to be the big get bigger and stronger and because they you know they have Prime, they have more technologies that this has been on their radar longer they have more containers they have more trucks they have more dollars to spend on solving these problems they're going to be the winners so that's going to be you know it is going to be I think a bad year for the small medium sized business the incumbent brands that are just getting their legs under them and you know having to kind of have a Miss effectively miss a holiday because you couldn't get a bunch of product it's going to be be a rough rough year for everybody. Jason: [57:25] Yeah no I in a way it's going to be the exact opposite of last year when covid first hit nobody obviously had Advance warning or was prepared for this and so a secondary impact was a bunch of eCommerce sites that didn't traditionally get a lot of consumer visits, got a lot of Trials because Amazon constrained FBA in Amazon head supply chain problems right and so suddenly you were looking to get your instant pot from Bed Bath & Beyond suddenly a bunch of people are looking to see what eBay had, that hasn't shopped eBay in five or ten years right so a lot of those kind of second-tier eCommerce sites got extra visits as people were. Trying new address the supply chain shortages this year I think we're going to have exactly the opposite there's going to be a ton of supply chain shortages there's going to be a lot of, news stories every day about supply chain shortages and the big players with the best infrastructure in the most advanced supply chain planning, like the Amazons and Walmarts of the world and and targets, are going to be the winners and it's going to be a lot harder for those specialty retailers and Regional retailers to compete unfortunately. Scot: [58:41] Yeah I think that that is the setup and we will continue so that hopefully that gives everyone an idea of the big talk in the industry and you were just at an industry event is this what everyone was talking about Jason. Jason: [58:55] Yeah yeah slightly less than I would have expected I mean it was a huge topic everyone understands the supply chain thing. I do think it was the first conversation a lot of you know customer experience folks and people that you know we're kind of had their head down in their own in their own Silo you know we're suddenly getting their eyes open to the fact that like. Yeah your customer experience is going to stink at there's no products on the. Scot: [59:20] Mix the CX person's job a lot easier they just you know just take the holiday off. Jason: [59:26] Yeah and so you know it is interesting though again like. [59:31] You know we may we may hit the top line numbers and it may be from a lot less items that sold more expensively. The you know category there's going to be winning and losing categories by far and again because of the consumer health and the supply chain issues, the supply chain for diamonds is looking a lot better than the supply chain for Budget shoes and so you know you just may see what jury where you know you say you sell a few things for a while, do better you know where there's extra scarcity then you know some of these low-margin high-volume consumer goods and so I think. [1:00:08] My key takeaways for everyone is it's going to be a very lumpy like the averages will be interesting we should all follow them but but every. Um retailer and every category is going to experience a very different holiday and there just is more uncertainty than there has been in the last 30 years of retail so like for anyone, to definitively say this is how it is going to play out I think is super risky because there's so many things that could go either way at this point, will consumers you know by another toy when they can't get their first choice will consumers go to a restaurant you know or not will consumers take a vacation or not. You know all of these these will they pay 5% more for something or not like there's just so much uncertainty that you know this is going to be. Holiday that really rewards people that do good scenario planning and are prepared for any eventuality. Scot: [1:01:06] Absolutely and we will keep you posted here on the Jason Scott show but hopefully this gives everyone kind of a framework to work within and we'll be updating various components of the supply pain as we get closer to Holiday. Jason: [1:01:22] And until next week happy commercing!
This week on the Millionaire Car Salesman Podcast, Sean V. Bradley, CSP interviews Danny Zaslavsky, the Managing Partner and General Manager of Country Hill Motors in Merriam, KS. In addition to his role at Country Hill Motors, Danny is also the Managing Partner of VinCue. VInCue is an innovative all-in-one solution that gives dealers access to real-time data and tools in a single system to stock smarter, increase turn, beat your competition, and above all else - maximize profits. Sean V. Bradley and Danny Zaslavsky dive into used cars. Most specifically, they discuss the concept of highest authentic value. Highest authentic value is attributing anything to the vehicle that makes it more valuable than just the price. The foundation of highest authentic value starts with options, features, packages, and dealer exclusive values. These will tie to keywords that consumers search, attracting them to your VDP. Since the VDP on the vehicle includes the correct options and packages, the vehicle has a higher value to the consumer. From there, you can really add more fuel to the fire by including dealer inclusive items and listing reconditioning to the vehicle, like warranty and certification. Consumers would purchase a vehicle that has had reconditioning performed over a vehicle that has not. By including these items on the listing, with the highest authentic value, it allows you to communicate this information to the consumer. Danny discusses how VinCue can not only help dealerships acquire more vehicles, but how they can start attributing all of the features of each vehicle, especially those that add value beyond price. Additionally, VinCue Boost takes the mystery out of digital advertising. It connects your actual inventory to Facebook & Instagram, and Display Ad Networks, and uses advanced data mining to only show ads to the right customers. This allows dealers to sell vehicles as fast as possible while making as much money as possible. Resources Dealer Synergy & Bradley On Demand: The automotive industry's #1 training, tracking, testing, and certification platform and consulting & accountability firm. The Millionaire Car Salesman Podcast: is the #1 resource for automotive sales professionals, managers, and owners. The Millionaire Car Salesman Facebook Group & The Millionaire Car Salesman Club on Clubhouse: the largest social community for automotive professionals to help educate the automotive industry. The Against All Odds Radio Show & The Against All Odds Radio Show Guests & Listeners Facebook Group: Hosting guests that have started from the bottom and rose to the top. Win the Game of Googleopoly: Unlocking the secret strategy of search engines. The Millionaire Car Salesman Podcast is Proudly Sponsored By: VinCue: In addition to being built by dealers for dealers, VinCue is an All-In-One Digital Platform. At the end of the day, it can help your Dealership! Callsource: The industry leader for call tracking, lead management, and business analytic solutions. For more information on how to maximize your marketing dollars, visit www.callsource.com. AutoWeb: Visit AutoWeb.com/dealers for help in revolutionizing your business to help you sell more cars. CarNow: Sell more cars now! Not only is CarNow.com the market leader in tailored digital solutions, but they are built to help dealers sell more cars.
They just keep.......on.........coming. If you've received more robocalls over the last several months than ever before, you're not alone -- and this is in spite of new laws that were supposed to clamp down on them. So we'll go In Depth. Shoppers are ready to break out the cash and cards and retailers are ready to take them. This holiday shopping season could be a BIG one ... if the supply chain can fix itself in time. And we'll talk with Burbank Congressman Adam Schiff on the Democrats' ambitious budget bill that seems to be losing support by the minute. It became sort of an opening line over the summer: are you Team Pfizer or Team Moderna? Health officials said the shots were the same. Until they weren't. So should the Pfizer crowd be worried? California, we are not doing a great job at conserving water as this drought gets worse. And we'll talk with a 6th grader from Huntington Beach who, on her own, chose to start off the school year with remote learning......until her 12th birthday...when she's eligible for the vaccine. Learn more about your ad choices. Visit podcastchoices.com/adchoices
In today's episode, my guest is Vikas Bhambri the SVP, Sales & Customer Experience from Kustomer. They are a top-rated Customer Relationship Management (CRM) platform that helps Shopify brands to deliver modern omnichannel customer service that creates customers for life. Kustomer is a Shopify Plus Certified App Partner and powers many notable brands in the Shopify ecosystem like Thirdlove, Bulletproof Coffee, Untuckit, Outdoor Voices, and more.This is a timely conversation with the holiday shopping season just around the corner.WHAT YOU WILL LEARN TODAYThe new expectations of personalized customer support.Why ticketing systems are outdated for the modern consumer.Advancements in Kustomer's AI interpret a customer's intent to resolve or route requests faster.Why consumers are contacting customer service throughout the buyer journey: before, during and after the transaction.LINKS AND RESOURCES MENTIONEDKustomerKustomer Shopify AppKustomer Now. What's NOW and What's NEXT in CX - November 10, 2021 [Virtual Event]ThirdLove Case StudyBulletproof Case StudyThis episode is brought to you by Attentive, the most comprehensive text message marketing solution for modern Shopify brands. See acast.com/privacy for privacy and opt-out information.
Welcome to another episode of Action and Ambition. In today's episode, we are joined by Chinedu Eleanya, Founder and CEO at Mulberry Technology. A software platform that allows retailers to offer extended warranties to online customers was co-founded by him in 2018. Mirror, a fitness device, Breville, a coffee machine manufacturer, and Nectar, a mattress company, are among the company's key clients. Mulberry has over 50 clients and hopes to make over $1 million in revenue this year. Chinedu moved to the United States with his parents when he was 11 years old. Chinedu led engineering, product development, and technical integration. Chinedu earned a BS in Biology from Cornell University. Stay tuned to find out more on this!
Chicago's antique shops are seeing a bump in business as other home good stores suffer from supply shortages and shipping delays. Crain's reporter Ally Marotti talks with host Amy Guth about the influx in business that has forced some dealers to change how they operate. Plus: Jump Capital raises $350 million venture fund, BMO Harris joins wave of banks closing branches, consumer price growth cools and Mariano's parent company partners with Instacart to set 30-minute delivery goal.
“Shippageddon” first entered the retail industry lexicon in late 2020, describing a conflation of global supply chain issues that led many brands and retailers to be under-stocked or otherwise unable to fulfill customer demand for purchases last year. A year later, many of those issues have not been resolved, and there are new hazards to deal with. Retail brands are preparing for round two of Shippageddon. The term Shippageddon was first coined in late 2020 on an episode of the retail podcast The Jason And Scot Show: ”We were talking about the likely e-commerce peak we expected from the holiday, on top of the e-commerce peak we were already seeing due to Covid-19, and we felt like retailers were likely to run into shipping capacity issues,” said the hosts of the show. And the alarm that retail experts sounded did in fact bear out. Shoppers were indeed met with stock-outs, longer delivery timelines from all carriers, and less overall discounting ahead of the holidays. But the outlook doesn't look much better for 2021. Make sure to tune in to find out more! MENTIONED IN THIS EPISODE Connect with Kiri Masters Learn more about Bobsled Marketing Check Mike Beckham's post on Twitter The Jason And Scot Show Read New Data from Q2 Shopping Index Check a map of Amazon's air fleet network across the US UPS 2021 Postage Price Changes Read Forbes article Amazon Hobbles Merchants' Prime Day Preparations With Inventory Restrictions Read rate hikes from the USPS
Finance Fix with Gemma Acton: US shoppers will soon be able to spend Bitcoin at retailers; consumer confidence rises. See acast.com/privacy for privacy and opt-out information.
Although Google pushed it's cookie ban to 2023, retailers need to prepare for a cookie-less future now. Shoppers expect greater privacy and security than ever before, says NRF VP of Retail Technology and Cybersecurity Christian Beckner. On this episode of Retail Uncharted, he explains how retail marketers can get privacy and security right while still driving sales.
Shoppers at an Auckland supermarket have been stabbed in what New Zealand's Prime Minister is describing as a terror attack. Can Schools be made COVID safer? Victoria plans ventilation audits of classrooms, paediatrician - Doctor Greg Kelly joins us. And brace for more online shopping delivery delays, we'll explain what's behind it, and the services worst affected.
On today's episode, we discuss the likelihood of an attention recession, if Peloton's troubles are temporary, what shoppers think of SMS marketing, Amazon's podcast moves, TikTok for small businesses, the best work-from-home perks a company can offer, how the weather can make you friendlier, and more. Tune in to the discussion with eMarketer director of reports editing Rahul Chadha, analyst Blake Droesch, and principal analyst at Insider Intelligence Paul Verna. For sponsorship opportunities contact us: email@example.com. For more information visit: https://www.insiderintelligence.com/contact/advertise/ Have questions or just want to say hi? Drop us a line at firstname.lastname@example.org © 2021 Insider Intelligence
In today's interview, we speak with Daniela Klein, content marketing manager at Trusted Shops, a German-based company offering trust-building services to online shops and their customers throughout Europe. Learn how Trusted Shops use content marketing to foster trust among their audience by educating online shoppers around online shopping security. Tune in as Kyler Canastra chats with Daniela about the different roles she's had in content marketing so far, the importance of being flexible, and more about her role at Trusted Shops.
818 is the best-selling!https://www.thespiritsbusiness.com/2021/07/kendall-jenners-818-tequila-sales-soar/Warheads spikedhttps://people.com/food/warheads-sour-spiked-seltzer-artisanal-brew-works/Suntory reformulatedhttps://www.thespiritsbusiness.com/2021/07/suntory-unveils-reformulated-yamazaki-25/Shoppers want to buy in-store!https://www.businesswire.com/news/home/20210728005651/en/Shoppers-want-to-buy-Beer-Wine-and-Spirits-In-store-New-ChaseDesign-Survey-RevealsTatershttps://vinepair.com/articles/krogmans-bourbon-trolling/Check us out on Instagram @curiosity_publichttps://www.instagram.com/curiosity_public/Watch us on YouTubehttps://www.youtube.com/channel/UCcplnOSfcnOh5paIL2LdaAwWe have t-shirts! Grab them here:https://curiosity-public.myspreadshop.com/allStay curious!All claims made here about alcohol, whether in this podcast, in this description, or on our Youtube channel, are solely our opinions and intended only for those of legal drinking age. All links provided here should only be accessed by those of legal drinking age.
EP272 - Q2 Ecom Data, Earnings, and Amazon News US Dept of Commerce Data In July retail sales were up 13.3% from previous July (down 1.1% from June). Year to Date sales were up 21.1% vs. 2020. Apparel is in the biggest recovery, up 63%. At peak of pandemic, restaurants lost nearly $51B/mo of sales to grocery stores. In July the gap has closed to $4B in sales. Restaurants sales for the past two months are higher than two years ago. Retail sales for all of Q2 2021 grew 28.2% from Q2 2020, e-commerce in Q2 grew 9% during the same period (due to the very high covid driven e-com last year). E-Com was 13.3% of retail sales for Q2. Q2 Retail Earnings Reports Walmart – US Comp Store sales up 5.2%, E-Commerce up 6% Target – US Comp Store sales up 8.9%, E-Commerce up 10% Home Depot– US Comp Store sales up 3.4%, E-Commerce flat Lowes– US Comp Store sales down 2.2%, E-Commerce up 7% Stores selling essential goods are comping against a very large 2020 basis in Q2. Most stores saw increased foot traffic driving store growth. Concerns about Covid resurgence and supply chain disruptions loom for Q3 and Q4. Amazon News NYT wrote that people now spend more at Amazon than Walmart – Jason says the number are debatable and that's besides the point. WSJ wrote Amazon Plans to Open Large Retail Locations Akin to Department Stores. We discuss Episode 272 of the Jason & Scot show was recorded on Thursday August 20, 2021. http://jasonandscot.com Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Co-Founder of ChannelAdvisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing. Transcript Jason: [0:24] Welcome to the Jason and Scot show, this is episode 272 being recorded on Thursday august 19 20 21 I'm your host Jason retailgeek Goldberg and as usual I'm here with your co-host Scot Wingo. Scot: [0:39] Hey Jason and welcome back Jason Scott sure listeners Jason we had a little bit of a break in there you had vacation and I got to focus on car washing and it's good to be back together. Jason: [0:53] It is I had a great time but I did miss you. Scot: [0:57] Oh I did see that while you are on vacation your company won a big Walmart deal so I think they would like for you to go on vacation more often. Jason: [1:09] Yes that is the general consensus the like I have great empathy for anyone in these spaces where you have these like huge drawn-out pitches but this was like. More than five month pitch and. Not shockingly it took the the client a little longer to pick a winner then they they promise so I you were kind of. On pins and needles for a long time and then I went on vacation and we got a good result so I think all my my co-workers my the hundred of my co-workers that were involved in this pitch with me like are all eager for me to work even less than I already do. Scot: [1:48] Well I heard it was because Doug mcmillon listens to the podcast. Jason: [1:54] Yeah amongst others so Chef to all of our listeners from Walmart thank you so much for putting your trust in me and all the mean things that get said about you on the podcast all come from Scott please remember that. Scot: [2:08] Absolutely not I love Homer I probably spend more time in a Walmart than you. Jason: [2:13] That is debatable but I do know that you are a legitimate Walmart Shopper and and you have an awesome use case for Walmart. Scot: [2:25] Which one are you referring to. Jason: [2:26] I feel like Walmart is your go-to for hard to find Star Wars collectible toys. Scot: [2:34] That is true I have spent many a midnight at a Walmart waiting for the pegs the toys to be hanging from the pegs and it's just the best time to be at Walmart is the best people people watching that 12:00 to 3:00 a.m. period. Jason: [2:47] Yeah they're there are some interesting shifts that go on at a Walmart store especially the 24-hour ones. Scot: [2:57] And then I'm super jealous because on your vacation you've got to go two galaxies Edge before me and that is for the non Star Wars fan folks in the audience that is the new Star Wars attraction at both the California and Florida Disney parks. Jason: [3:16] Exactly and it was awesome we went to California Disneyland as many listeners will know I'm a dad in the body of a grandad so I have a, almost six year old son so we took him to Disneyland for the first time and generally, my my Advanced age is a disadvantage but in this one case it was an advantage because I had a much better excuse than you do to take time off from work and go to Galaxy's Edge. Scot: [3:43] Awesome well I'm bummed was it fun how would you rate it. Jason: [3:48] I highly recommend it I mean yes the whole trip was fun Galaxy's Edge lived up to my expectations and there's. Kind of too wet in the old days we would have called e-ticket rides in Galaxy's Edge. Smugglers Run on the Millennium Falcon and this much more extravagant ride called rise of the resistance and they were both awesome I would say rise of the resistance is the best ride I've ever been at an amusement park so so, totally cool totally worth it and you for sure have to go and I'll go with you when you're ready. Scot: [4:22] All right strong words were gone we'll take we'll take all the listeners will take your mom and you know some of the other folks with us. Jason: [4:31] I'm sure a lot of listeners would love to go the one that wouldn't would be my mom because my six-year-old dragged her on every roller coaster at Disneyland and he had a blast but she was like white-knuckled the entire time. Scot: [4:43] Okay so she's already checked the Box. Jason: [4:46] Exactly exactly you're not a big enough draw only the grandson is a big enough traffic to your bed. Scot: [4:53] Well I'm glad you had an awesome vacation and the last time we recorded a podcast was one of my favorite days which is Amazon earnings and today is one of your favorite days of the year this is when the US Department of Commerce who sidebar has been on the podcast they drop a big load of data what did you discover in the data. Jason: [5:15] Yeah so just side note I just to be jealous of my my month Disneyland. Got got invited to keep working with my my favorite client for for the foreseeable future and I got quarterly e-commerce data from the US Department of Commerce so that's what I call winning. But yeah let's jump into it so. We're recording this on a Thursday on Tuesday the US Department of Commerce released their monthly retail sales data so super brief. Primer recap they published data every month. For the previous month and that's called the advanced retail monthly data it's kind of a quick look at the the month it was 15 days prior. And then they publish more comprehensive set of data for two months back which would be like 45 days prior. So so that's the data that we got on Tuesday and of course we're all pretty interested in what July looked like because there was this whole kind of. [6:19] Covid recovery and people rushing back to stores in the pivot from online back to stores and then there you know had been a lot of like negative news and rebounds because of Delta and so you know it's kind of interesting to see. See how the the data swung and so in general, if you were someone that looked at month-over-month retail sales it was a Debbie Downer month so Joel I was about one percent lower than June, but as I have counseled many times on this show that's not a very important number to look at what we really want to look at is July 20 21 against July. 20/20 so so year prior data and retail sales for for this July were 13.3% higher, then last July so ordinarily that would. Um cause for a party that's a huge growth like ordinarily we see like kind of for to unit three to four percent growth year over year in total retail sales so 13% is huge. But of course. Last July was still pretty impacted by by covid so we have this weird basis and as we'll talk about later that's why most retailers are talking about year over two years at this point but so first data point. [7:44] July was a good month it was up 13 percent from the previous July. [7:51] We I also like to look at year-to-date sales so I add up all the months and January through July of this year is up 21% versus January through July of last year, which is also very healthy and again half of that period would have been pre covid versus last year so that's that's encouraging and then, there isn't a. [8:14] In awesome measurement of e-commerce in the monthly data especially the advanced monthly data but there is this thing called non store sales which is kind of the closest proxy we have to e-commerce and that's where things got interesting it was about 5.9 percent up from last year so way slower growth. Then you would normally expect for e-commerce so you normally expect retail the girl about four percent in e-commerce to grow 12 to 15% so so retail growing 13% is unusually fast and and Ecommerce growing 6% is unusually slow. But again if you think about the fact that last July a lot less people are going to stores and instead spending online. It kind of It kind of fits so I would from my perspective, there was nothing there was nothing like super anomalous in this data it's kind of where we would have expected it to be and then I like to dive into the categories and see if there's anything important in the categories and again the categories are kind of where you would expect, by far the category that's most up this year versus last year on a monthly basis and a year-to-date basis is a Peril so the apparel industry is like. [9:32] Sixty-three percent better this year than it was last year because they were just absolutely creamed by by covid last year restaurants and bars or up thirty percent over last year but then there's some some categories that actually did well in covid but are still pretty significantly up so things like furniture and home, Sporting Goods those and consumer electronics are all up significantly. Even though they generally got a covid boost so. That that is pretty interesting and then the thing that I most look at specifically related to covid is. In covid everyone bought all their food from grocery stores instead of restaurant so restaurants got creamed grocery stores did really well and so we've been watching to see if that. [10:26] Goes back to pre covid levels and it's getting awfully close so you know in. March of last year seventy percent of the calories got sold by grocery stores 30% by restaurants and that's a that's a that meant 60 billion dollars a month in sales that used to go to restaurants were going to grocery store so that's huge. And in July that Gap it became kind of, 52 versus forty eight percent so only a 4% Delta and pre covid-19 t-50 so that's that's about four and a half or five billion dollars a month, that grocery store still winning that they didn't win before covid but not surprisingly. Like people were eager to go back to restaurants and they are going back to restaurants and that's one of several indications we've seen that while. Digital grocery grew a lot during covid and it's going to keep some of those gains it does not appear to keeping all of those games and we are seeing some backslide and we're seeing that in things like like instacart sales as well. Scot: [11:40] Yeah there's been wasn't there a rumor that instacart was looking to be acquired. Jason: [11:46] Yeah yeah there's a few things out there there is a rumor that instacart was talking to doordash. And then Super interesting this week and I'll put a link to it in the show notes former guest and friend of the show Dan McCarthy who remembers the, the professor at Emory that specializes in in customer lifetime value and cohort analysis he got a big. Set of credit card panel data from Ernst research and he was able to use it to kind of. [12:20] Back into the gmv which in the restaurant business or the grocery business they actually would call govt Gross order value um and he was able to kind of figure out the size and stickiness of doordash and instacart and what he found was, instacart got a bigger covid bump than door – but that door – is much stickier and and has a much higher rate of repeat customers than instacart in fact. About 30% of he found that about 30% of door – Shoppers repeat and only about 20% of instacart Shoppers repeat and that that difference, is is very meaningful in the financial outcomes for those two companies and he kind of estimated that insta cards govt is probably around twenty three billion dollars on an annualized run rate so he kind of looked at it and said hey instacart does appear to have significant weakness versus door – and and so it kind of lien when the some Credence and some tangible Nest to the. The rumor that you know instacart might be on a covid peak in trying to sell at it's at its high we've also heard just some rumors that they're you know struggling to retain some of their there, customer Sellers and some things like that so so it's going to be an interesting space to follow. Scot: [13:48] Any other surprises from the dinner. Jason: [13:50] Nothing wildly surprising in later in this podcast we're going to talk about earnings and we're going to talk about Home Depot and Lowe's reported and so sort of a preview I would say like. Um the do-it-yourself category was a category that did really well in in covid-19, um and so you you know it's interesting to see like if that sticky if have you know as people are starting to go out more are they are they stopping the investment in their home and or are they reinvesting in their home this year is that a new habit so I've been watching the do-it-yourself space and it had modest growth. From last year so I want to from memory I want to say it was about eighteen percent up from last year and last year was a very. Hi year so that that's interesting and I won't spoil it but it's going to be that number will be even more interesting when we talk about how Lowe's and Home Depot. Scot: [14:53] Let's jump into it. Jason: [14:54] Okay so the next thing I wanted to talk about is so I mentioned that this monthly data doesn't have awesome e-commerce data in it. The US Department of Commerce publishes much better e-commerce data but they only publish a quarterly and that's why this week is so fun is because this is one of those quarter months when they publish both the monthly data and the quarterly data so we just today got the cue to e-commerce data from the US Department of Commerce and the top line here is Q to 2021 Drew about 28% from Q2 2020 and e-commerce. [15:38] I'm sorry tale so that's all of retail which like that's way higher growth than you normally see and eCommerce growth was 9% for that period so lower. Then you would normally expect to see right and again that kind of follows the trend here. E-commerce was artificially High last year and so you know even though it's growing it's growing against a bigger base and so the growth this year does not look as big. So a lot of people are you know trying to talk about. Growth on a two-year stack but that 9% growth becomes super interesting when you think back to Amazon you know Amazon got beat up because their rate of growth slowed a lot they were down to 22 percent but 22% still means you're more than growing more than twice as fast as the industry average. And as we're going to see you later like much faster than most of their competitors so so that that is pretty interesting and then a ton of news then writes like e-commerce is down. Because nine percent is lower than we would usually expect but I just want to remind people. That down doesn't mean what you think it means like like we sold more stuff online in Q2 of this year than we did Q2 of last year and Q2 of last year was amazing. It's just the rate of growth is slowing down. Scot: [17:02] This is where I always get confused because the headlines that came across my CNBC trackers were retail sales were down 1.1 percent and worse than expected. Jason: [17:14] Yeah so that was. Scot: [17:15] How do I reconcile that with 28%. Jason: [17:18] Yeah well so the 1% is monthly and it was that mean that was down month over month so that's June to July so, July 2 July monthly going back the retail sales were actually up by 13 percent which is much more healthy and Q2. Versus last Q2 retail sales are up what did I just say 20 that's the. Scot: [17:48] But okay but then the month-on-month is interesting because why do you you know if we're still coming out of covid you would expect it to be kind of climbing up even if we were heading into the fall or. Jason: [18:00] What you have to remember about consumer spending patterns and Retail is there it's all heavily driven by these purchased occasions and there's a bunch of purchase occasions that are tied to date and so the spending patterns you'd expect to see in July are different than the spending patterns you'd expect to see in June so there's there's more people spending on summer activities in June than July and there's more people starting to spend on back to school in July then in June and so there are all these factors that make it really hard to. Compare month-over-month in West you you do some like heavy seasonal adjustment gymnastics and even that tends to not work because, some of these these purchase occasion shift from month to month from year to year so sorry it's complicated. Scot: [18:51] Got it dads and grads will scrap it up two dads and grads being in June. Jason: [18:57] Yeah but so I mean my biggest takeaway is like as a retail I guarantee you every retail team I work with care a lot more about there. Their sales bases from last year than they do their sales bases from last month. Now the Miss versus analysts expectations that's a separate story and some you know obviously is you know like investors tend to get squeamish when, when the recharge missed the analyst expectations but it's super hard to predict analyst it's a tough job for the analyst right now given all the uncertainty around health and covid and we simultaneously have states where they're throwing parades because covid over and people are opening up and then we have states where their reinstituting Mass mandates so it's. It's like high degree of uncertainty at the. [19:51] Um so in that climate some poor companies had to report their earnings and face investors and so this was to me a fun week for earnings calls, Walmart reported their their Q2 earnings Target reported their Q2 earnings Lowe's and Home Depot reported their Q2 earnings and then TJ Maxx reported their cue turning so it's a pretty fun week in retail earnings um and. Again I tend to focus more on the operational metrics and less on the investor metrics so you know there were some beets and some misses in there that impacted stock performance and I don't pay that much attention to those. [20:33] As a reminder because Amazon reported a couple months ago and we did a whole show a couple weeks ago we did a whole show about it, Amazon is predominantly e-commerce and Amazon's Q2 was up 22 percent from Q2 of last year so so, put that data point in your head and then you go okay home Walmart and Target how did you guys do Target was up eight point nine percent. Which was a beet and Walmart was up 5.2% which I want to say was a meat if I'm if I'm remembering right so so both those retailers did pretty well they sold a ton of stuff last year during covid and they sold significantly more this year. Um with less of a covid impact and less of an economic stimulus impact and so that that. Was pretty encouraging both retailers throughout cautions about. Their performance the rest of this year and so both retailers I think had some negative movement in their stock based on there, um on there like forward-looking expectations but not based on their performance so so again. [21:53] Amazon twenty two percent Target at eight nine percent will call it and Walmart at 5%. Um that's their total sales e-commerce was a much more interesting story targets e-commerce grew ten percent. [22:09] And Walmart's e-commerce grew three percent and those numbers are tiny by historical standards right so Amazon is all e-commerce so their 20% growth means their e-commerce grew 22% so the so Amazon's e-commerce grew more than twice as fast as Target and more than four times as fast or about four times as fast as Walmart so that that makes Amazon's performance look even more impressive if you think about Target like last year. [22:41] They grew a hundred and ninety-five percent so, so again like really sucky to comp against that that huge huge Peak and last year Walmart grew a hundred percent so they're comping against a huge Peak so the, the story of Q 2 for all these retailers is going to be, you know how do they hold on in their total retail sales can they kind of beat the industry average and then. You know where do they fall on e-commerce and candidly like. Target Walmart and Amazon kind of don't surprise me what surprised me was Lowe's and Home Depot so remember I told you earlier that, the do-it-yourself category is crony US Department of Commerce is performing reasonably well it's like up like eighteen percent so. Home Depot with retail sales for the quarter were only up 3.4 percent and lows sales were down 2.2%. [23:52] So Kind of hard to reconcile that in my head like there are many other do-it-yourself retailers besides Lowe's and Home Depot. I almost think this is like highlighting a problem in the US Department of Commerce categorization because it just, I can't put together a model where Home Depot only grew by 3 / 3.4% where lows went backwards 2.2% and yet the whole do-it-yourself category went forward, yeah but that being said Home Depot's e-commerce and super cheesy how they report this like they Home Depot totally tried to bury this but Home Depot's e-commerce growth was flat, they did not grow from last quarter from this quarter last year again off a big basis they grew a hundred percent last year and then was grew seven percent. Which you know again that that's actually better growth than Walmart and Lowe's also had a big basis they had a hundred and thirty five percent so on an e-commerce standpoint you'd say like glows actually kind of out performed in e-commerce but then the bad news for Lowe's is they way underperformed and in terms of a brick-and-mortar thing which is of course much more meaningful to them. [25:11] Um so those were kind of the monthly earnings so. That I you know I think that is a trend the other thing that came out in these earnings calls is both Walmart and Target talked about how last year retail traffic was way down but ticket size was way up people came to the store to last and they bought more in each, trip almost all the retail growth we saw this quarter was from increased trip frequency, so it was almost all tied to more people walking into Targets in Walmart like there's probably pent-up demand go shopping from people that were we're doing more of their spending online so this is kind of, all of these data points are converging to say that people are are had kind of online fatigue and we're happy to go back to stores and we're seeing that in the industry data we're seeing that in the earnings data and you know it's going to be really interesting to look at Q 3 because. It's not clear that that trend is going to continue based on some of the the health news and. State restrictions that are getting imposed and certainly based on some of the international news. Scot: [26:22] Yet it was this time last year when we kind of coined the ship again, I wonder if we're teeing up for you even kind of a tougher holiday this this may be kind of teased out of the date a little bit like maybe maybe Lowe's was down because of supply chain issues of you know they just couldn't stop the stores I don't know that that's one way to explain kind of why one retailer would be doing bad but the category did it better, and yeah so you know the supply chains are all jammed up there's just all the way from Manufacturing to hear stories of you can't get room on boats and certainly planes and then when it gets here you can't get it off the dock because there's not enough trucks and then you know I'm living the nightmare scenario where you can't buy vehicles and I have a business built on being buying Vehicles so you know there's you know. The whole system's and need to add capacity for delivering more and there's literally no vehicles to be had due to this tube shortage so it's gonna be really interesting next four months to see how this plays out. Jason: [27:35] Yeah no a hundred percent agree I'm super concerned about holiday the inventory levels like wouldn't really show up in the, the kind of reported earnings like where it would come up in is the transcript of the investor calls and I'll confess I didn't listen live to I did listen to Walmart and Target I didn't listen live to Home Depot or Lowe's I kind of skimmed the transcript so I can't I don't I did not see, then calling out supply chain as a reason for this quarter's performance it definitely was called out as a risk factor for there. Their future performance and what was a little interesting is Walmart and Target vote both went to Great Lengths to express that they felt like they were going to be in a good inventory position for holiday and I say that because none of us are expecting them to be in a great inventory position for holiday so they're they're trying to. Push back that narrative and it like obviously those are two of the biggest retailers that have a lot of Leverage over the supply chain so it's like, you know if anyone can buy inventory it's going to be them and they're saying they've invested early and they think they've got the inventory they need for Holiday locked up. Your points are all, super valid like every step in the supply chain is more expensive and more fragile right now and the one that you didn't mention is. [29:05] It's also just harder globally to get stuff made and you know if you look at the global, like flow of covid there's really only one economy economy that completely recovered and got a hundred percent of their retail foot traffic back for example and that was China and guess what China is, like in the throes of a Delta pandemic and foot traffic to retail as way down like they've had a back slide and that has impacted factory production and productivity and you know you mentioned one tangible, way that's playing out as these chip shortages but like there's a bunch of them and then we also have this Global labor shortage, and a place where it's been particularly hard to hire people is in warehouses and factories and so I here in the United States we've got like a bunch of Labor shortages we've got a bunch of labor dispute so I want to say Mondelez has like three big factories under strike so Santa may not be able to get Oreos this Christmas like there's a lot of those things playing out right now so I would say, that Walmart and Target may have locked up enough inventory but there's. [30:21] Severe uncertainty about the holiday and I think everything we talked about for ship again in last year's going to be worse this year. FedEx and UPS have both announced their surcharges for holiday and they've already informed most of their customers of what there, how they quotas will be so that's going to for sure come into play the US Post Office which historically has not had surcharges is adding surcharges this year so lots of stuff going down and again, I'll be shocked of Amazon has as much capacity as they want but you know Amazon unique amongst all these retailers owns a lot of their own capacity and in fact. They're huge Amazon air Hub in Cincinnati just went online so. Yeah yeah and even when you can get stuff it's just more expensive like I want to say that like average price of a container with six thousand dollars last year and it's 22 thousand dollars right now so. Scot: [31:19] Effort Amazon Seller say 40,000 I don't know. Jason: [31:23] I think yeah it depends on what you know but yeah and so I again I've seen like. Retailers by part of a porch in Canada I want to say, um Canadian Tire like literally bought a shipping Port you know we've seen lots of retailers including Home Depot by their own container Freighters like, we're seeing all kinds of crazy reaches up into the supply chain to try to protect capacity so it's it's definitely going to be interesting. Scot: [31:54] We will keep listeners posted well this is the place to go to where we're called it last year early and we're going to keep tracking it and calling it early this year. Yeah and then since we're doing a news episode it wouldn't be a Jason and Scot show without a little. Jason: [32:15] News new your margin is there opportunity. Scot: [32:23] That's right Amazon news Jason I saw this one got your dander up a little bit on on the the Twitter there was a New York Times article where they talked about how Amazon is now officially a hundred percent without any argument bigger than Walmart and an article what they do is they use a third-party source for GM v data which I actually appreciate this because for a very long time I was trying to help educate people that that you can't just look at Amazon Revenue numbers that their impact is bigger because there's this kind of Iceberg neath the surface of gmv that matters because if someone buys something from a 3rd party seller for $100 other retailers lost $100 they didn't lose the around $10 commission that Amazon shows us Revenue so I thought this was pretty interesting and when you you gross up now the number they used was pretty aggressive I don't know who this this Source was I don't have a subscription but it seemed a little aggressive and the lines are definitely going to cross I thought maybe they had pulled it into your to what we're I know this kind of got you a little agitated what what do you think about this. Jason: [33:39] Yeah yeah so it's super interesting it's a great article it's it prompted a lot of conversation I am mildly annoyed so first of all the I have seen as a result of this this article got written in the New York Times and it's a very accurate article. But it then got echoed by hundreds of other Publications and it got. Progressively worse so a I thought that would warm your heart is a ton of these articles go to Great Lengths to explain why revenue is in a valid way to compare these retailers and what gmv is and it's like. They all have discovered this year what you've been been teaching all of us for four. Probably 10 years now at this point we're old but so that was kind of fun so the New York Times article the headline first of all was people now spend more at Amazon than at. [34:33] And then the subtitle is the biggest e-commerce company outside of China has unseated the biggest brick-and-mortar seller. And so what this article is saying is, they're using a gmv estimate from a data company that sells data to investors and so it's a Wall Street analyst firm called factset and facts that said, Walmart's trailing 12-month gmv, was 500 Global GMB was five hundred sixty six billion dollars and Amazons 12-month gmv was six hundred and ten billion dollars so for the first time Amazon's Global gmv is higher than Walmart's and so Amazon has finally passed. Past Walmart and you know we've hit this big milestone that everyone should be talking about right like so that was their article and nothing in its wrong I would argue that the fact that data tends to be on the aggressive side but, maybe aggressive for both and, facts that is not estimating gmv for Walmart just you know like they're using revenue for Walmart and they're using GM V for Amazon and as you know, Walmart now has a meaningful Marketplace why got you know I don't think they've disclosed what the. [35:59] The ratio of 1 Peter 3 p is but Walmart has said they're going to sell 75 billion dollars online this year so. That you know their gmv is likely significantly larger than their revenue but the biggest reason this isn't an apples-to-apples comparison is these two companies don't sell in the same countries right so Amazon's and many more countries than Walmart so you know their incontinence that that Walmart isn't in and, the there India is a quite large Market both of these companies are significant players in India, the Amazon includes India sales in their gym in the fact that Jim V there are the facts that GMB includes am India for Amazon Walmart revenue does not include any India sales because Walmart owns a minority majority interest in Flipkart. [36:53] Um but that's that's really the way Amazon does business in India as well like if you're doing Apples to Apples I would argue that it's probably true that Walmart is still slightly bigger than Amazon of you if you put India back into these numbers and and do a gmv estimate for Walmart instead but I don't, even really care about that what's annoying is everyone that read the New York Times article then wrote a new article saying Amazon's the biggest retailer in the world and that's, wildly untrue because. Ali Baba's gmv is bigger is like 1.3 trillion right so its bigger than Walmart plus Amazon's estimate in these articles and that's why the New York Times had to write the most awkward headline ever that's like, outside of China even and you go well why are they saying outside of China when both Walmart and Amazon are competing in China well it's because they don't want to talk about the fact that they're both way smaller than Ali Baba. [37:51] And so so again like I just I kind of don't think this is a very big milestone I think Amazon spins more time and effort trying to sell more stuff in the US than anywhere else and Walmart spends more time and effort trying to sell in the US than anywhere else it's the whole market for both countries for companies it's highly likely that Amazon is going to pass Walmart for sales in the US in the near future I don't think they have yet and when they do that will be a big milestone that will be like when Walmart passed Sears Versailles in like 1990 but to me that's the big milestone that this, this kind of facts that data thing that New York Times is trying to spin and then you know everyone else misreported like to me it's. Not that interesting and so I'm kind of annoyed how much Buzz it's gotten but I just blew it and gave it a bunch more buzz on the podcast. Scot: [38:44] Okay another one Amazon this was kind of the big big topic today there was a leak or someone figured out that Amazon is going to open a department store. How do you feel about Amazon departments course I feel like they're going to have put Target out of business in six months. Jason: [39:09] I just sold all my Target stock it so it's over. I'm kidding yeah so I mean this is interesting news the. I would say it's very vague news at this point like I don't think it surprises anyone that Amazon is interested in and is probably moving forward with trying a bunch of different retail floor mats I do think Amazon realizes that. That brick-and-mortar is important I don't think they think of themselves as purely an online, retail and they've been investing a bunch of brick and mortar and a category they want to do better and is a parallel and they have been making a lot of progress in a parallel so it's not shocking that they would be trying to experiment with some apparel formats so so this news is kind of exciting I'd be eager to see what they what stores they do open and I'm aisle you know quickly go visit them when they do to see what see what they're trying but. From this article it's hard to know exactly what they're talking about so the the leases that the. The reporter found in this is an exclusive article from Wall Street Journal. The wheezes they found were for thirty thousand-square-foot stores so the first thing is again everyone saying like Amazon's getting into the department store business. There are almost no 30,000 square foot department stores most department stores are much bigger than 30,000 square feet. [40:33] Whatever it's worth the the article says that apparel is one of the categories that's likely in this new store from Anonymous sources that talk to them. So does that mean it's primarily an apparel store so that would make it like a Kohl's or T.J.Maxx eyes store and that could be interesting and meaningful or does it mean it's a general merchandise store that has some apparel and also has a full grocery store because there's a lot of 20,000 25,000 square foot grocery stores so 30,000 square feet. Isn't that much different than the the bigger store formats we've already seen Amazon starting to experiment with so I guess I'm just saying. Any brick-and-mortar news from Amazon is interesting I'll be super eager to follow it but there was nothing, to me and this announcement that goes man my mind's blown this is a major Game Changer or some some new industry that wasn't worried about Amazon last week should be super worried about them this week like I think all those Industries should have already been worried. Scot: [41:35] Yeah and a lot of people I saw coming and we're saying they're abandoning the bookstore this means the 4-star store doesn't work they're getting rid of just je wat technology the Amazon goes towards and I think people just kind of, Amazon. At the heart of their DNA is to experiment with stuff doesn't just because they're experimenting with something doesn't mean the other things failed they can run they have the resources to run 300 experiments retail store experiment simultaneously if they want to and that you can't really read that kind of stuff into them I think that's really jumping the gun. Jason: [42:12] No I would a hundred percent agree with that and again it's built right into their leadership principles like small autonomous teams right so it's not like it's one big entity and they can only do one thing at a time. They've got you know a ton of entities that are doing a ton of things at a time so I I certainly. Scot: [42:28] Purposely don't talk to each other because it was a slow not yeah. Jason: [42:31] Yeah absolutely. So excited to see them doing new things I do think when they open new store formats they tend to be more Innovative than than traditional retailers that are opening new format so I hope they open them and I will be there when they do. Scot: [42:48] And then while we were on the podcast Tesla announced they have a new robot swiped will have to you have to order one of those and then give us a gadget unboxing kind of walkthrough of how that goes. Jason: [43:02] I feel like you are higher on the Tesla waiting list than I am so we may have to leverage your status but I'm all for doing a robot Deep dive at our earliest convenience. Scot: [43:12] Yeah humanoid robots kind of freaked me out so I think I'll lose my status to send it to your hostel we'll see if it a skynet's you or not. Jason: [43:20] Yeah isn't is there another Terminator movie coming out I think there is. Scot: [43:23] There's always another Terminator movie coming out sometime. Jason: [43:26] Fair enough awesome we'll listen we set a goal for ourselves to do a shorter concise show and I said I think we can knock this out in 30 minutes so I totally blew that this feels like about 45 minutes but hopefully it was valuable to listeners if it was we sure would appreciate, five star review on iTunes if you have any questions or we got anything wrong in the show you want to talk about we would encourage you to hit us up on Twitter or Facebook. Scot: [43:57] Yeah I like to think we gave everyone 50% more for their money today so you're welcome. Jason: [44:03] Yeah and you and I earned fifty percent less what's 50% of zero awesome well until next time happy commercing!
Begin with the market basket & work backward. Shoppers buy multiple items each trip. Make it easier for them to find and buy your products along with all of the other items in their basket wherever they shop. This is how you close gaps & maximize sales This episode's FREE downloadable guide 30 SECRETS To Prosperity Workbook Wish You Know How To Confidently Grow And Scale Your Brand? Use this workbook to take notes and jot down your daily inspirations as you listen to the podcasts and watch the YouTube videos. This will help you gain clarity and focus as you work to achieve your goals and objectives. The Retail Solved Blueprint will teach you everything you need to know to confidently grow and scale your brand, build a connected community of loyal evangelists, and multiply your brand's impact, sales, and profits.* Every slight improvement means more runway for sales growth, higher brand valuations, better terms when negotiating with investors, fuel for more innovation, greater support for mission-based causes, and much more. CLICK HERE TO GAIN INSTANT ACCESS TO MY 30 SECRETS To Prosperity Workbook Guide FREE Trade Promotion ROI Calculator: RetailSolved.com/PromotionROI Download the show notes here: RetailSolved.com/session255
This is week three of my psychology of pricing series. Where I share research-proven strategies to influence people to part with their hard-earned money. Some of these pricing tactics work great with your design business, and many of them are perfect for helping your clients get more sales. If you haven't listened to part 1 and part 2, I suggest you do so before continuing with this one. Let's continue with the series. The Psychology Of Pricing - Part 3 As I mentioned in the previous parts of this series, these tactics were taken from a very in-depth article by Nick Kolenda on the psychology of pricing. Have a look if you want to read through it yourself. Since you're here right now, I'll presume you want me to continue summarizing each pricing tactic. So let's get on with the list. Tactic 19: Raise the Price of Your Previous Product. This tactic applies whenever you or your client introduces a new, more expensive version of a product. Although under certain circumstances, it may also work with the services you offer. If you're introducing a new, more expensive version of a product, what do you do with the old version that's left? Many people would lower the old one to sell the remaining stock as soon as possible. But a 2010 study suggests raising the price of the old product might be a better idea. If you lower the old product's price, you'll be reinforcing the lower reference price, which makes the new product seem more expensive, making people question if it's really worth it. Let's say the old product originally sold for $100, and the new product is priced at $130. If you drop the price of the old product to a clearance price of $80, people are going to wonder if it's really worth spending $50 more for the new product. However, if you raise the old product's price, you also raise people's reference or anchor price, which enhances their perceived value of the new product. So instead of dropping the original product's price from $100 to $80, you raise it to $110. Now, people who compare the old and new versions will favour the higher-priced new version that is only $20 more than the old one. And those looking for a deal will be happy to save $20 by purchasing the old version. Tactic 20: Sort Prices From High to Low. A study conducted in 2012 showed that, on average, customers chose a more expensive option when products were listed in descending price order from highest to lowest. This study was conducted in a bar over the course of 8 weeks. The researchers regularly alternated the sequence of the beer prices. Sometimes the beers were listed from the lowest priced beer at $4 down to the highest-priced beer at $10. Other times they reversed the list putting the $10 beer at the top. The researchers discovered that, on average, the bar generated more money in beer sales when the higher prices were listed first. Why does this work? Once again, it comes down to the ever-important anchor price. Whenever someone looks at a list of prices, the first few prices create their anchor price. If the initial prices are low, it creates a low anchor price which creates an aversion to spending money on the higher-priced items lower on the list. If someone wanted to splurge a bit, they might opt for a $5 or $6 beer instead of the base $4 beer, but they probably won't be interested in the highest-priced beers at the bottom of the list. However, if you reverse the order by placing the highest prices at the top to act as the anchor price, each lower price on the list seems like a better deal. Instead of spending $10 on a beer, someone might decide to save a bit of money and opt for a $7 or $6 beer instead. They feel good about saving money but still spent more than in the previous example. As a species, we have an aversion to losses. When we see a list of ascending prices, meaning from low to high. We subconsciously see each price as we descend the list as a loss. Our motivation to minimize that loss causes us to chose a lower-priced product from the top of the list. But when we see a list of descending prices, meaning from high to low, we see each item as we go down the list as a loss in quality. And since we don't want to lose quality, we are motivated to purchase the higher quality, and hence more expensive product. So if you're putting together an eCommerce site for a client, you may want to put the higher-priced items first in the hopes of increasing the average revenue from each sale. This might also work with the Three-Tiered Pricing System I'm so fond of. I show my three price options from lowest to highest. It might be worth reversing it and showing the most expensive option first. You never know. Tactic 21: Position Prices to the Right of Large Quantities This tactic applies to products sold in bundles. A study conducted in 2012 shows that listing prices to the right of large quantities convert better. 70 items for $29 is better than $29 for 70 items However, the study showed that two conditions must be met for this tactic to work. Condition 1: The unit price calculation must be difficult. Meaning it shouldn't be easy to figure out the individual unit price. The tactic works well with "70 items for $29" because it requires a somewhat difficult calculation to determine how much each item costs. However, "10 items for $10" is too easy to figure out for this tactic to be effective. Condition 2: The item quantity must be larger than the price. Following this condition, "70 items for $29" works, but "3 items for $29" doesn't. This brings us back to anchor prices again. "70 items for $29" works because, as Tactic 18 states, exposing people to any high number creates an anchor that makes the lower price seem more favourable. So $29 seems more favourable when placed to the right of "70 items." Tactic 22: Add Visual Contrast to Sale Prices. When you compare a price to a higher price, people are less likely to shop around for a comparable price. This is the same trick that works with the three-tiered pricing strategy. By showing three prices, you reduce your client's chances of comparing you to another designer since they already have various prices to compare together. Tactic 22 takes another step and optimizes that comparison by visually distinguishing one price from a reference price. As shown in a 2005 study, changing the colour of a sale price triggers a fluency effect. Customers will misattribute any visual distinction to a greater numerical distinction. By listing the original price in black and the sale price in colour, you create a greater numerical distinction making the sale price seem more favourable. Combine this with Tactic 3: Display prices in small font sizes for a double whammy. So not only should you change the colour but also make the sale price smaller to bring home the sale value. Tactic 23: Offer a Decoy Option. We've discussed using your own products as reference prices to prevent clients from looking elsewhere for comparison prices. Tactic 23 says you should consider adding a “decoy option.” Back in 2008, Economist magazine did something that many people thought strange. They offered three subscription options. Web Only: $59 Print Only: $125 Web and Print: $125 What? Print Only for $125 and Web and Print together also for $125? That had to be a mistake. Why would anyone chose "Print Only" when they could get "Web and Print" for the same price? That was the point. Further investigation revealed that without the "Print Only" option, people couldn't accurately compare the other two subscription options. How much should a "Web and Print" subscription be? Who knows? Most people had no idea and therefore chose the "Web Only" option. In fact, 68% of people subscribed to the "Web Only" option. But when Economist introduced the “Print Only” option, it helped people compare the other options. Because "Print Only" was the same price but a worse version of the “Web and Print” option, people could now easily recognize the value of the "Web and Print" subscription. With the "Print Only" option available, subscription purchases suddenly shifted, with 85% of people buying the "Web and Print" option. Economist magazine generated 43% more revenue simply by offering a Decoy Option. By offering a similar, yet worse, version of a more expensive product, you influence the comparison process making the more expensive product more appealing. How could you use this tactic for your design business? When submitting a proposal, you may decide to offer a logo package for one price, a website for another price and a combined logo and web package for a very similar price as the website alone option. It might be worth testing out. Motivating people to buy. So far, we've been talking about ways to make prices more appealing. These next tactics are not about making the price look better but more about giving people a little nudge and motivating them to buy. The idea here is to reduce the “Pain of Paying.” That feeling you get when you have to part ways with your hard-earned money. This “Pain of Paying” comes in two factors. One: The pain we feel when our money leaves our hands. Two: The pain we feel when we pay after we consume. Uber, the ride-sharing service, does a great job of countering these. With a normal taxi, you see the price meter go up and up with each kilometre you ride which causes stress. Plus, you're forced to pay once you reach your destination heightening the Pain of Paying. Uber, on the other hand, is almost pain-free. You pay for your ride in advance, and their app is connected to your credit card, so you barely notice the money leaving your hands. Offering credit card payments for your design business and charging upfront are both ways of reducing the Pain of Paying and motivating people to buy from you. Tactic 24: Remove the Currency Symbol. A 2009 study showed that the Pain of Paying could be triggered pretty easily. Just seeing a dollar sign (or Euro or Yen or whatever currency symbol) reminds people of that pain and could cause them to spend less. Removing the currency symbol can help reduce that pain for them. However, don't start leaving the currency symbol off without considering the clarity of your price. We often need the currency symbol to show that a number is, in fact, a price. Only use this tactic where people expect a price to appear. Such as on restaurant menus. Tactic 25: Charge Customers Before They Consume. Whenever you can, charge people before they use your service or product. It's a benefit to everyone involved in the transaction. By charging first, you know you've already been compensated for the work you do, so you won't be worrying about getting paid. And chances are your client will be happier with your product. A 1998 study shows that people are happier with a product or service when they prepay for it. This allows them to focus on the benefits they're receiving, which numbs the Pain of Paying. If they've already experienced the benefits before paying, such as a taxi ride, spending the money becomes much more painful. This tactic works great for designers who offer retainers. Make sure you charge your retainer clients at the beginning of the month for the services they will receive. Not at the end of the month for services already rendered. Tactic 26: Attribute Bundled Discounts to Hedonic Products. To be honest, I don't understand this tactic. Plus, I had no idea what the word "Hedonic" meant. So I looked it up. Hedonic is Something relating to or considered in terms of pleasant (or unpleasant) sensations. In other words, attribute bundled discounts to pleasant (or perhaps unpleasant) products. Even knowing the definition, I still don't fully understand how this tactic works, so I'm not going to try and explain it. If you're curious, you can read the full description of Tactic 26 in Nick's article. Tactic 27: Don't bundle Expensive and Inexpensive Products. The tactic is self-explanatory. Avoid bundling expensive and inexpensive products because the inexpensive products reduce the perceived value of the expensive products. A 2012 study asked people to chose between a home gym and a 1-year gym membership. The results were an even split, with 51% choosing the home gym. But when the researchers bundled the home gym with a fitness DVD, only 35% of people chose the bundle, the rest opting for the 1-year gym membership. The inexpensive fitness DVD reduced the perceived value of the home gym. Tactic 28: Shift the Focus Toward Time-Related Aspects. Try to avoid references to money when describing a product. Instead, focus on time: A much greater benefit. An experiment conducted in 2009 had a lemonade stand where the researchers alternated three different signs advertising the product. Sign One focused on TIME: “Spend a little time and enjoy C & D's lemonade.” Sign Two focused on MONEY: “Spend a little money and enjoy C & D's lemonade. Sign Three was NEUTRAL: “Enjoy C & D's lemonade.” Shoppers were told they could pay whatever they wanted between $1 to $3 for a glass of lemonade. The results were unanimous. Not only did the “TIME” sign attract twice as many people to the stand, but those people paid more for their glass of lemonade than the other patrons. Whenever you write sales copy, emphasize the enjoyable time people will have with your product or service over the money they may save. The added benefit is that not only will focusing on time make your offer more appealing, but it will also lessen the Pain of Paying. More to come. Next week I'll conclude this series with the final tactics in the psychology of pricing.