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Retail Unwrapped is a weekly podcast hosted by Shelley Kohan from The Robin Report. Each episode dives into the latest trends and developments in the retail industry. Join them as they discuss interesting topics and interview industry leaders, keeping you in the loop with everything retail. And thanks for joining  us.

I’m Shelley Kohan and today we’re going to share three relevant shifts in retail from our podcast earlier this year. What will be the imperative going forward? Let’s reflect back on some of the highlights from Retail Unwrapped 2024 podcast episodes that are shaping 2025.  So, of course, we would be remiss if we didn’t talk about the new government administration moving in.

Tariffs are top of mind for CEOs and CFOs. While there are some concerns about raising prices due to looming tariffs, others are in favor of the tariffs to bring back manufacturing to American workers. And the principles that America was built on, paying a fair wage, safe work environments, these high standards are in conflict with the ever growing outsourcing work that many companies partake in.

Either way, the American people pay with higher prices due to tariffs or lack of jobs economic uplift without the tariffs. Global sourcing can go against the fundamental rights that we believe in with U. S. manufacturing. It’s a real conundrum. As with any leadership change, the consumer will be impacted and apprehensive going into the new year.

Will the rich get richer? Will the poor get poorer? Will the new administration actually support the Americans who are struggling today? So, first we’re going to hear from Bayard Winthrop, the founder and CEO of American Giant, from his podcast earlier this year. And then we’ll get some snippets from Eric Wierson, who is a six time Emmy award winning television producer and also a political analyst for Newsweek magazine.

Let’s hear what they have to say. Bayard Winthrop, the founder and CEO of American Giant, from his podcast earlier this year. And then we’ll get some snippets from Arick Wierson, who is a six time I know you’ve always said, you know, we make our products in the USA because we want to keep things close, which means better control, better supply chain, and in turn, better quality service.

And you also talk about the footprint. So can you tell us a little bit about what you mean by footprint?  Yeah, I mean, I’ll answer a little more broadly. The irony in my judgment is that we sort of got, we’ve got ourselves in a bit of a tangle as a country, I think, and that we,  we have worked very hard as Americans to put in place a bunch of values and laws that we think are universal and are important.

Those are environmental laws that are human rights laws that are worker safety laws, all these things that matter a ton to all of us.  and we hold our domestic factories to those very high standards and appropriately. So you have to pay minimum wage, living wages. You have to provide safe working conditions.

You can’t employ children. You have to respect individual rights, all these things that we think are pretty fundamental. And at the same time, we let our biggest brands, the brands that we know that are in our kitchens and in our closets. Skirt those regulations and pursue the cheapest means of production.

And so that, that, that imbalance between on the one hand, really penalizing,  people that make things in this country by holding them to these standards at the same time, letting our big brands get richer by offshoring and chasing cheap production. Is a real problem that needs to get reconciled.  The environmental impact is a piece of that.

I mean, there’s a, there’s a great irony for businesses that call themselves environmental, but that are making things in countries that don’t respect environmental laws anywhere nearly as much as the United States does. And then move that product all over the globe to kind of optimize for cost.  tell me a little bit about, so when we think about kind of this new age, and I really do believe that the country’s going to be going through quite an adjustment over the next six months, you know, what should businesses and brands be thinking about?

Number one, if you don’t already and you can afford it. You need to hire an on staff geopolitical analyst, analyst. You need to have someone who understands, you know, you may not, you may say, Oh,  we don’t do government contracting. We don’t even have offices in any of these places you’re talking about in Europe or Latin America or anywhere else.

You need to understand this new world order that’s coming because it ultimately will affect you. We live in an integrated economy. If you can afford it and you, can find the right person to manage that person, so that you find the right person to fill that role, I should say. Okay.  you know, you need to hire someone that has that geopolitical expertise to help inform the decision making that goes on between the board and the CEO and the executive suite.

And so I think that, you know, the number one thing I’d say is that companies of all ilts, all industries, all sectors, all sizes need to be a lot more aware of what’s happening outside of their, their particular sector and their particular niche. I think they need to be, much more,  aware of, of how geopolitical trends that seemingly are on the other side of the world and in a different sector might sort of blow back into their industry and it’ll affect their supply chain or affect their pricing or affect the fact that the economy and their consumers.

I think that, you know, there’s, it’s going to require companies to be a lot more professional and be a lot more organized going forward.  So Eric, like five years ago, the hot job in retail was a data scientist. Now the hot job in retail is going to be geopolitical analysts. Yes. I think, I think he’ll come up with a better name for that, but it’s basically that role, you know, the, you know, the, the chief geopolitical officer or something like that.

Right.  that’s very interesting. So aside from that, when we think about, you know, what’s going to transpire over the next six months, is there any other, you know,  Advice that you would give to retailers and brands and how they should be thinking about, yeah, you know, actions to buy. Well, I would say, I would say this, this is something that I think each brand needs to think about is.

And I think for some brands that are particularly wins that are more B2B, it’s probably less of an issue.  but I think what we saw in the results of yesterday’s election  is a clap back on woke ism, a clap back on me too ism, a clap back on, you know, On hyper sort of sensitivity about different, you know, identity politics, a clap back on frankly, and I think in my particular case, my personal opinion, unfortunately, a clap back on the environment.

You know, we are going to, we are entering a new arena where these things are just not going to have the same importance, or in some cases they are actually become enemies of the state.  I, for example, I don’t think the environmental question is going to go away, but it’s going to be very much sort of de emphasized.

It’s not going to be something you hear a lot about. It’s not going to be something that’s going to be front and center like it has been. frankly, certainly during the Biden administration, but just as a broad trend, even going back to the Obama years.  so,  I think that companies that have really positioned themselves around some of these issues, whether it’s like, let’s say,  inability and the environment, they’re going to have to really rethink, well, what does that mean in this new environment?

And it could be that there’s an ad reaction to that clapback. It could be that. You know, I think, I think personally, and there’s a lot of data to support this, that no matter your politics, I think there, there is a sizable percentage, well over 60, 70 percent of the U S population believes in climate change and they believe that we need to do something about it.

Otherwise we’re not going to have a planet to give to our grandchildren, our great grandchildren. And so I think that, you know, there may be an ab reaction if the Trump administration goes too far in, you know, I mean, I certainly he’s talked about, he’s going to do more drilling, but. You know, I do think that, you know, the companies need to be really aware that I think some of the social mores that were sort of the foundational sort of aspects of the, a lot of these brands that have really become popular over the, in recent years, I really gonna have to take a look and say, you know, how,  not only what government does, how’s that going to impact me, but what the voters said they wanted in government, what does that say about voters and those particular voters?

When it comes to those issues, it could be that, you know, they say that progress is usually You know,  two steps forward and one step back. I think maybe last night represents that step back. And I think that, you know, brands that are really leaning into this, maybe a little too much, you know, may, may find themselves, you know, having to recalibrate some of their strategies.

Yeah, I think that’s going to be what’s going to be happening over the next six months. Everyone’s going to be looking inward at their own companies and, and their structures and really trying to figure out the impact here. before you leave, I would love for you to talk about the consumer. How is this going to impact the consumer?

And I don’t know if you know this, but I’m going to throw it out there. What’s your take on holiday? Do you think? This is going to ease holiday revenues for retailers and brands. Do you think it’s going to have more people be concerned? I think that, you know, Trump wants to bring more liquidity into the market.

Once he gets, I mean, obviously he’s not going to take office until January.  but I think that, you know, if you are someone that already has investments, you’ve got, you know, you know, whether it’s via your 401k or you actually have a portfolio or you have other types of investments, I think you’re going to find yourself a lot more flush with cash, which should generate some more movement into the economy.

I think if I was a betting person,  which I guess I am, but only once or twice a year when I go to Las Vegas.  I would, think about  looking at, at, at more higher end brands, because I think that’s going to be a lot of growth when it comes to luxury markets. So, you know, looking at the LVMHs of the world and that, you know, those types of brands are going to do very well.

I think during the Trump era, there’s going to be tax breaks, the very highest levels are going to trickle down to a certain extent, although I don’t really buy into the, the economic benefits writ large of that, I do think that there’s going to be some, some, some stat substantial, windfalls that are taking place at the, at the upper brackets of, of, of income earners.

I think so, you know, the consumer, I think in general at the higher end is going to see the benefits immediately. The tougher nut to crack for Trump and his, and, you know, and his government is going to be, can he actually get that to translate to the people that put it in office, which are people that are struggling and there’s, that’s the reason they voted for it.

That’s the big question out there, right?  Absolutely.  Our next shift is AI’s impact on the industry. It will be broad and deep. Retailers staying ahead of the AI technology and implementing in ways that resonate with their target markets are certainly better positioned to win. We’re going to be taking a peek at agentic AI.

New technologies that support the creative industries and the role of robotics in optimizing peak workloads. So we have John Andrews, co founder, CEO of Simulate. Bridget Johns, co founder, CEO of to and from Ken Pilot of Ken Pilot Ventures, and we have Tim Fears, COO of Happy Returns. Let’s hear what they have to say about AI and its impact on retail.

I’ve heard in the industry and I’ve, you know, as a retail pundit, I write a lot about this quote unquote conversational commerce and how AI is going to change the shopping experience through conversational prompts.  love to hear your thoughts about that. I do think the, I do think one of the benefits and why I think like generative AI and large language models are under hyped a bit is because of what is possible from a conversational perspective.

You know, if you think about how and and I’ll just let’s let’s start with search, right? Because I do think when you think about the conversation with a customer online, the back and forth, you can think about it as kind of a query and response every time somebody comes to a digital website, they’re going to click on something.

That click is on either a category page, the search box, an offer,  and, you know, a sale item, a product detail page. It’s giving context of what the customer is looking for, and then the retailer needs to return back kind of a set, you know, a set of content. And search is that foundational kind of query and response.

You’re querying the engine, saying, here’s the context. Bring back the right products and order them appropriately.  and historically, keyword search has been what’s ruled the day, right? It’s been hard to beat for 25 years. and what is possible now with an LLM kind of operating system powering this customer experience is that it can be more conversational, right?

I think there’s a way where you, you optimize the recall of products, but you can ask questions that are rather than like sweater or merino wool sweater, I can say. I like thin sweaters, crewneck sweaters that are, you know, merino wool or something like it. What do you have? Right? And I can put, you know, you can put that in and the, the, the retailer should be able to understand that query, bring back the right results and also come back with additional prompts that might be, you know, that might, might be interesting.

Is there a particular brand that you’re, you know, that you’re interested in? Do you like a design or just a solid color? And this conversation can kind of help engage in a way that doesn’t feel like a chatbot. It most certainly can’t be a chatbot. It needs to be more engaging, but provide more of a shopping assistant where that shopping assistant has the brain of understanding everything about the products and ideally understanding everything about the customer.

There’s this friction that exists because if you could just talk. It would be way easier. But when you get into this conversational commerce, and that conversation has to be like endless keyboarding, that is not a good experience. So I think like being able to anticipate finding the right user experience to like, fast track that understanding More about who you are as a person so you can sort of anticipate what you would say and  And help to fast track that I think it’s going to be Super important because I do think people are going to have fatigue from having to type into these conversations I would love for you to kind of explain to our listeners about agentic AI.

So what is it and how is this going to change how people shop? There’s a, there’s a ton of research and there’s a ton of development going on, on the agentic, on the agentic AI.  in the agentic a I landscape right now.  if we if we just think about first, like, what is what is the definition of it?

Right? And try to keep this relatively simple, right? But it’s it’s this idea of using artificial intelligence,  to use a I to autonomously.  Go out, perform specific tasks with specific instructions, and then, you know, come back with some some some answers and potentially even perform additional tasks, right?

You can think of this in some very simple examples as,  like a personal assistant, right? Where you can set it up to, like, go through your emails and automatically schedule meetings. Right. And just kind of it will go out and it it’s got an element of workflow into it, right? You give it some instructions and then it will do a, B, C and D.

What I think is going to get interesting from a,  from a, from a commerce perspective and from a retail perspective is. Imagine you had an,  agentic shopping  assistant, okay, where you can say, Hey, I’m looking for a new travel bag, right?  and my, my agentic assistant, I would probably have a better name for it.

Go out and look, I’m looking, I want something that, I don’t like roller bags. I like duffle bags, but it has to have a really comfortable shoulder strap that I can wear on a messenger bag. Okay. it needs to be at least, I don’t know, 40 cubic something or other,  and it needs to be waterproof. And I like neutral colors and from a cool brand.

And then it’s going to go out and it can go out and it can bring me back and summarize every word of what that it found. And then I can say, I like this one and then I can go out and buy it and get it shipped to my house. Like the whole shopping experience. All I care about is describing what I want.

Maybe making some decisions. You can think about it. Somebody coming into the dressing room, holding you, you explain it, holding up, but then having everything else just automated, automated for you. Do you have any like great technologies that retailers should be thinking about?  well, I have, I have another AI solution that maybe is one of my favorites, but it’s for the designers.

Okay. And it’s called Raspberry AI. And what Raspberry does is it enables designers to iterate.  Their designs and reiterate their designs far more quickly, reducing sample costs and increasing speed to market.  So cool. You know, you’re basically replaced. You’re not replacing the designer.  You’re replacing their bike with a car.

So imagine if you’ve designed, you have a sketch of a boot.  You can upload the boots into, I want to see this boot  in leather and Sherpa.  And all of a sudden you have four versions. Photo real versions of a boot with leather and Sherpa, and then I want to change the soul from off white to gray. I want to change the laces from cream to black.

And in real time, you are seeing this.  It’s amazing. I mean, those are, so that’s super exciting and that’s, they, they would compete with,  a Dolly or a mid journey, but they understand the DNA of the brand a little bit better. in fact, they just completed a huge round that was led by Andreessen Horowitz.

So very exciting, but that’s what Raspberry is doing. So that’s kind of super cool. And that’s really cool because like. So we used to, back in the day, when you were in the training program, we used to have four, four collections. That’s it. We’d have, maybe five. We’d have, you know, spring, summer, fall, resort.

But now we have these micro, all these micro, you know, capsules that come out, so now designers are really being taxed to have, you know, 20 different, 30 different, you know, mini mini capsules that are coming out, so raspberry must be a great help with that.  Well, imagine if you’re taking, you have a, a long sleeve drop needle turtleneck that was a bestseller for holiday and you want to create that spring rendition with short sleeves and maybe all of these things you can do very quickly just through prompts.

And the prompts are the same type of prompts you would use in chat GPT. So again, you’re not taking away. Creativity, you’re just accelerating creativity so you can get there sooner, and also have a better idea of what you’re getting than having to wait for a sample.  Operations need to be resilient to work well, especially through things like a peak season, which we’re just ramping up to now, along with Hyper growth, which is the average has the whole time.

So we, the robotics just create a system where it’s easier to win and harder to lose because you’re making machines do things that people did before. And it’s harder to get consistent outcomes with people than software and  hardware.  So there’s just a real resiliency benefit to it.  on like a, it’s harder to, to make that quantifiable, but honestly, that is the, I think most useful thing is it’s just not as hard to succeed and you want to create, you don’t want fair fights, right?

And the fight against complexity and volume you want to be, you know, you want to be the U. S. Army, in terms of the hegemony there.  and then, you know, more sort of more discreetly.  We’re much more productive than we were before. This helps make our service competitive, to, to retailers. We also significantly improve speed and quality.

So when you’re operating a multi hundred way sort, it’s very challenging to do it fast with people. So the robots, kind of blow up that complexity and make it faster. And it’s very easy to make errors in high velocity environments. If you look at any 3PL or warehouse, a lot of the tech is about making sure the right items go in the right box.

You know, think about sort of light to pick ASRS systems.  and our robots are achieving that, that kind of level of quality, which,  you know, it’s, it’s not a happy return if you get the wrong thing. So we’re very focused on shipping the right stuff to the right place.  Our last shift for 2024 is leadership.

Leadership shifts for the next few years. What does modern leadership look like going into 2025? Gone is the merchant prince or quote unquote princess. We also learn the four key attributes for the modern mindset. We get a peek into the idea of diverse mentality across Many all functions of a business and why every employee, including the CEO need to be chief problem solvers.

We hear from Brenda Malloy. She’s the CEO of Herbert Mines Associates, Lisa and Lonnie. She’s the principal and founder of retail strategy group. And we also get to hear from John Van Heusen, president, CEO of Ace Hardware and also a Crabe retail radical. To be very strong in strategy, vision, courageous around that topic.

They drive results. I mean, at the top of the house, they execute, they ensure their teams deliver. They have a great lens. They know how to spot talent, attract, develop and engage teams.  They drive engagement. They’re excellent communicators, both up, down, you know, and, with key stakeholders.  They bring  They put culture at the forefront of, you know, the company in terms of bringing soul, meaning and purpose, their relationship builders up, down and out.

They foster innovation. And today, you know, this list is not complete without being digitally. Fluent, and we’ll call it, you know, at the CEO level in, in consumer retail,  tech realists. So, there’s lots of bells and whistles, you know, coming out, but what’s right for the business they’re in. So, big, long list that really kind of boils down to they’re intellectually curious.

They’re smart. They’re dot connectors. They’re customer obsessed. And it’s, and it’s fascinating, you know, how many specs we get where it starts with that. We need to get closer to the customer. We need to understand our customer. We need to institutionalize that understanding.  the criticality of what that customer wants.

Not only from a product perspective, but from an experience perspective.  empathy. They listen, they seek to understand, they lead from the front, they have energy,  and you really don’t see a lot of ego. You know, we’ll say low ego. There, there’s pride, but it’s not leading from an ego perspective. So today, as we lead up to this,  they need to be authentic.

They need to be trusted. They need to be transparent.  And then now we have kind of, and don’t even laugh, but Gen Alpha is entering the workforce next year.  Shocking, isn’t it? It is.  And, and, you know, we’ve seen this with Gen Z. I mean, all the cultural shifts that happened. You know, in the workforce over the past five years, more so in the past few years, but, you know, how, how do you lead this new generation?

So, I, I think you’re, the article, frankly, that you, wrote recently, is fascinating. Going through that, a lot of the attributes of what we’ve talked about today are the critical attributes needed in order to lead this generation.  So listening, empathy, authenticity, transparency,  caring,  caring, and making that a priority that we need to connect and understand this workforce, you know, just as we did with, you know, Gen Z, et cetera.

So listening and not discounting. And and truly responding. So the human capital leader has never been, you know, more needed. Always a critical role, but the role today is is just paramount in terms of connecting with the workforce.  When we were talking about Retail Radical, you had said, I think it begins by encouraging, heavily encouraging people to fall in love with problems and then obsess over solving them.

So it’s about curious and being a chief problem solver.  my first question is going to be, were you born with natural curiosity and a passion for solving problems? And more importantly, how do you instill this in others?  Yeah, my curiosity is probably a bit of a curse and  I wouldn’t even want to work with me.

So  I can’t say it’s all good. But with respect to your second question, which is a great one, how do you instill it in others? Because I think it’s so important. It is just so important. Problem solvers are so valuable to a company, but I think there’s probably 30 things, but I think of three that come to mind as to how you try to  permeate this into an organization.

the 1st is that you have to model the behavior. The leaders in the organization have to model that behavior.  you know, that you do it and I won’t do it kind of thing doesn’t work. So modeling the behavior is paramount or you get nowhere. But then culturally.  To reframe problems or obstacles as opportunities.

I believe to be critical. Some people see it, you know, an obstacle. Other people see an opportunity. Some people see a wall, turn around, other people climb it. We want to make sure that there’s a culture where even the way we talk about it, reframes this thing, not so much as a negative, but as an opportunity.

So don’t say obstacles, say opportunities. I know it sounds trite, but there’s a lot of truth in it. And then third,  We got to reward the problem solvers, including financially. We want to brag on them. We want to reward them. We want to hold them up. We’ve got a system here at ACE of rewarding them. We’ve got these, you nail it awards, which of course we have, because we’re in the hardware business.

One of the things we say to leaders here all the time is that, you know, if you want to be an effective leader, much of it is about solving problems. and your leadership destiny at any company is often going to be predicated on the conviction and the efficacy with which you solve problems. So we, we certainly want a culture where that kind of behavior is rewarded.

How do you get this service excellent when you have such a different layout and different assortments? Like how, how do you do that?  Well, three things here. First, we need more customers like you show it. That’s number one. Number two, you’re right. And it’s stunning. Most people don’t believe it. Of our 6, 000 stores, there’s not one  that has the exact same assortment of goods as another.

Then that, you know, consultant that drives consultants crazy. You know, that that’s probably not how you’d build it, but it is a differentiator for us because they cater their assortments to the needs of the community. And our store owners are so, so good at that. I’m so proud of how they do that. Well, but yes.

You know, third on the consistency factor with service. If it’s got the brand ace on it, that is one thing we can’t tolerate anything less than exceptional service.  And we are far from perfect, far from perfect. It’s very, very hard to do. Think about the, you know, we have 100, 000 people that work in the stores.

We have millions of customers. It’s very difficult. But what we try to do is what I call a three piece. So it’s about parlance, practice and purpose. So, Harlins, just the way we talk about it here, we try very hard, mostly internally, to set very aspirational language so people understand the bar is very high

You know, our vision is to be the best, most helpful hardware stores on the planet. The earth wouldn’t be enough. We need to be, you know, the best, most helpful stores in the universe. you can see the language we’re trying to use there. we talk about our associates that work in the store, not as employees, but we call them red vested heroes.

These people wear capes in our view. That’s how important their work is. We say we’re blessed to be in the business of serving others. This isn’t a burden, it’s a blessing. So you can see we’re trying to, through parlance, talk about it with very high aspirational language, but talk’s cheap. So second is the practice.

I won’t go into details so I don’t bore you forever, but, you know, we call it internally, we need to operationalize helpful. So, task time needs to be quantified and reduced. customer facing time needs to be increased and there’s a system. We don’t leave our customer service up to chance. And so it’s the, it’s the paradoxical blend of a very six sigma like process coupled with the local personality of the store.

So it still feels, you know, it doesn’t feel soulless like many retail experiences do, but there is a system behind that because leaving customer service up to chance when your brand is all about helpful is. It’s colossal stupidity and we refuse to do that. And again, our local owners believe in it as much or more than anybody and they’re great at it.

Well, that’s a wrap for 2024. I want to thank our listeners for your continued support and wishing you a healthy and prosperous 2025.  If you missed any of these great episodes or any ones from last year, you can find Retail Unwrapped from The Robin Report on all Apple podcasts. Spotify, Buzzsprout, or  therobinreport.com. 

Thank you for listening to Retail Unwrapped. We’ll be back in one week with another podcast. Please subscribe on Apple Podcasts, Spotify, or any podcast service. If you have questions, ideas for a podcast, or anything else, please contact us via therobinreport.com.