Retail Rundown: Amazon, Walmart and the Case for Headless Commerce – with Faisal Masud and Jeff Roster

Julia Raymond Hare:
Today, we are joined by my guests, Faisal Masud and Jeff Roster. Faisal is the chief executive officer of fabric, that’s a headless eCommerce startup. And before Fabric, Faisal had a very impressive background. He was the CTO of Staples, the COO of Alphabet’s drone division, called Wing, and he helped create AmazonBasics, which we all know and love.

Juila Raymond Hare:
Jeff is the chairman of the Retail Advisory Board at Apptricity and the former vice president of strategy at IHL group. Jeff is also the co-host of, This Week in Innovation Podcast. Be sure to give him a listen on Spotify, Apple podcasts, or wherever you download your shows. Faisal, Jeff, thank you for joining us today.

Faisal Masud:
Thanks for having me.

Jeff Roster:
Glad to be here.

Julia Raymond Hare:
So we’ll jump in. We have a bit of an interesting conversation today. We’re going to talk a little bit about headless commerce, maybe get into a little bit of the podcast drama, as we were supposed to have Shopify on today to discuss this with us, but they did drop out last minute. And I guess, before we get into that, I’ll go over some data, just some interesting new research that payment’s released. They showed Amazon’s revenue growth is set to outpace Walmart’s by a rate of three to one over the next five years. That’s pretty interesting considering Walmart’s brick and mortar presence, but between now and 2025, Amazon’s revenue is set to increase by an average of 63 billion, that’s 15% annually, compared to Walmart, which will see sales rise by 4.6% or 20 billion.

Julia Raymond Hare:
This data also revealed Amazon will control about 14% of the market in 2025, that’s up from 2% in 2014, so that’s a huge jump. 2% in 2014 to 14% in 2025. Walmart is projected to retain nine to 10% market share. These are huge market shares. That’s where we want to set the conversation today. What are your thoughts on this new data? I’ll leave it to Faisal, if you want to go first.

Faisal Masud:
Yeah. Thanks, Julia. I just want to comment on the first thing you said about Shopify not coming. I completely understand why they wouldn’t want to, but we would love to invite them, at any point, to talk about headless with myself, Ryan, or our CTO, Omar Sadik, who’s also an Amazonian. So if at any time, we’d love to have that opportunity.

Faisal Masud:
On the question about Amazon controlling, this is not surprising, number one. Number two, I have a couple of observations and points on this one, which is one, at Amazon. The business is run in a very different way compared to any other retailer on the Amazon runs its business based on inputs and not outputs. I’ll break that down a little bit more.

Faisal Masud:
So, when you’re a category leader at Amazon and you’re running a business, let’s just say sporting goods, let’s pick a category, you’re focused on, not revenue, you’re focused on four key things, traffic generation selection, expansion being the number one in the selection, price parity with the market, not lowest price, but equal price to the lowest price. And then finally, last mile delivery, making sure your nodes are always delivering Prime as much as possible, which is having, we called it Fast Track, back in the day. If you have those four inputs, biggest selection, lowest price, fastest delivery, there’s no question in the world, you’ll be the biggest category leader for that particular category. I saw this live, running mobile electronics, building Amazon warehouse deals, and other areas where we were maniacally focused on what the inputs were because we knew if the inputs for right, the outputs would come.

Faisal Masud:
In comparison, if you look at the retail industry, even when I arrived at Staples, all we ever talked about in our weekly, monthly business reviews, was revenue and margin. Now those are two outputs of what I just described. So when you start talking about revenue and margin, and you don’t talk about the inputs that are going to drive those, what’s going to end up happening? You’re always chasing, you’re in a constant chase. What are you going to do? Lower price, high, low, whatever games you can play. And the rest of the retail industry is stuck with that. So, Amazon’s 500 million plus SKUs today, roughly. Walmart, I’d be shocked if they’re touching a hundred. Amazon, availability of fast track, Prime inventory, pretty much anything you need is available, same day, next day or two hours. Walmart, I’m not sure what’s available, and I’m not sure if it’s from the right brands that I want. And then finally, when it comes to brand recognition, because of the selection and the convenience of one click for those 17 years, when they held the patent, or whatever time period, they’ve just set the standard in this, right.

Faisal Masud:
It’s very hard for Walmart, right now, to come and chase that business. And I think if they focus more on their core moat, which is what they’re doing in healthcare, etc., They’d probably be a lot better off trying to gain traction there, versus just chasing with Walmart Plus, which I think won’t do that well.

Julia Raymond Hare:
I liked your points on, Amazon is run in a different way. It’s on inputs, not outputs. You mentioned the four key inputs compared to what you said, your experience working in retail leadership. You’re always talking about revenue and margin. I’ll let Jeff jump in real quick, on his viewpoints as an analyst, but I wanted to ask you, some people like our friend, Doug Stevens, the retail prophet, and others say, “If you think Amazon is retailer, you are out of touch.” They’re not in the game of retail. They’re trying to control every aspect of our lives, essentially. Would you agree with that?

Faisal Masud:
I’m going to go back to the little bit of the punditry and the shock and awe of the statements. Look, Amazon is a technology company that enables commerce, in any which way possible that could be B2B, B2C, video on demand, whatever you want to call it. But the underpinnings, the foundation, begins with the technology. And I’m going to go back to the earlier comment in our conversation, which is, because Amazon is built on hundreds of thousands of services and it’s completely headless. Yeah, it’s a technology company, yes, but its goal is to please customers. That’s what I would say.

Julia Raymond Hare:
Love it. Good. Jeff, I’ll let you jump in.

Jeff Roster:
Yeah. A couple of thoughts. One, we in the analyst community have been forecasting this day that Amazon, or debating, would Amazon cross revenue with a Walmart. It’s it’s here, or at least it’s almost here. And so it’s, I don’t know, a little concerning, I guess, for those of us who love retail, and want to see multiple, tens of thousands of SMB retailers being successful. So, the day is here. A couple of things, also, to think about is, when I started my retail analyst career 21 years ago, we used to always talk about Walmart as the example, and now we no longer do that. We talk about Amazon. So it’s definitely another, crossing the chasm, moment for retail.

Jeff Roster:
The thing that’s really important about those numbers, and I actually really don’t care one way or the other about those kinds of payment numbers. What I do care about is, who’s going to drive this industry, who’s going to be the most aggressive adopter of technology, who does every other retailer need to size up and understand what they’re doing, to try to improve their game. And both those companies are going to be that. So as an observer of the space, it’s like watching, Godzilla versus King Kong. They’re both heavyweights and they’re both going to slug it out.

Jeff Roster:
The bigger point, from my perspective, in looking at those numbers is the warning call. If any retailer on this planet has not fully embraced the idea that, “I am in a battle with the most aggressive adopter of technology, maybe in the history of this world,” now’s the appointed hour to understand that. You’re dealing with a company that is the most aggressive adopter of technology I’ve ever seen. That has hundreds, if not thousands, of experiments running at any given time, most of which are targeted at your business. It is now, now is the appointed hour to really rethink what you’re doing, and prioritize your technology approach to your business. Your CIO needs to be a rockstar as opposed to a cost center.

Jeff Roster:
We need to be looking at all kinds of new technology. I think we’re going to get into a conversation about headless commerce. As somebody that’s had to forecast overall IT spend, if you look at the level of just infrastructure spend that retailers do, it’s phenomenal. It’s huge, very little percent of spend ends up doing any kind of differentiating of the business. And hopefully, as we fully embrace the cloud and fully embrace low code, and some other strategies, we can push that percentage of innovative IT spend up well above the five, six, 7% it is now. And hopefully, we’re all talking about millions of retailers in 2030, and not five or six.

Julia Raymond Hare:
And Jeff, just to clarify, did you say it’s only around five to 7% right now? IT spend?

Jeff Roster:
Well, you’d have to classify it. See, we had, in my Gartner days, 50% was non-differentiating infrastructure, 20%, let’s see, 20% was significant, but not innovative. And I think only five or 6% was truly innovative IT spend. The devil’s in the details, but it’s not a lot. We’re spending a ton of money on just keeping servers running, or just keeping infrastructure running. And the more we attack that, the more, I don’t think a retailer will cut their overall IT spend, all I’m advocating for is, look for cheaper ways to do things so you can spend the money where it matters. And that’s at the point of customer service.

Julia Raymond Hare:
Sure. And Jeff, as you said, we will get into headless commerce. You made some good, but obviously scary, points for any of our SMBs who tune in. And this is a B2B show about retail. So we do have mostly executives and retail that listening. But for some of the listeners, who might not be as familiar, I’ll pass this to you, Faisal, just why is headless called headless? Let’s start there.

Faisal Masud:
It’s called other things, too. Composable commerce, etc., etc.

Faisal Masud:
I don’t really know where the term came from, honestly, to be very direct. But essentially, if you think about it, it’s basically removing the head, aka the storefront, away from the back-end. And, the back-end being all the clunky plumbing that goes behind, between item, price, promo or cart, checkout, all of those pieces that run the website. In the past, you would have a monolithic like a Demandware, or a Oracle ATG or IBM WebSphere that you make one configuration change and everything had to go down for it, because it was all glued together. Headless separates the back-end from the front-end, so the logic can sit away from the front-end, where the customer can continue to see a great experience. It can deploy changes faster. And essentially, headless has gained ground, because the more you go to a service oriented architecture, the less you have to worry about these long production cycles, and testing cycles and where you are pushing code once a month.

Faisal Masud:
I mean, when I got to Staples, we wouldn’t do a change for 30 days. They would be called a quote, unquote, a build. And that build would build up, and then we would deploy, and oh no, something went wrong. We revert back to the original state. And then, you don’t have a push for another month. So, that’s just not feasible. If you want to be agile, you need to have a headless platform, so you can keep pushing code every week, every day, and testing, and learning and deploying new features. And, that’s where it becomes quite critical for businesses reaching a point where they are no longer needing an e-commerce in a box solution, which Shopify is probably the best solution out there in the world. Once you graduate from that and go to tens of millions, I think moving to headless becomes a better equation for most.

Julia Raymond Hare:
Mm-hmm (affirmative). A better equation for most, you talked about moving to a more service-oriented approach. And I think, if you’re listening to the show before we hopped on and started recording, we were talking a little bit about how a lot of people don’t immediately associate headless commerce with Amazon. But Faisal, you said, “Amazon actually was probably the one who invented it.”

Faisal Masud:
Yeah. I mean, invention is a big word and you can say it any which way, but I think the architecting of a service-oriented, sort of headless architecture existed at Amazon well before anybody else. So, claiming that someone else did it is, it’s hard for us to digest here at Fabric, because we have a lot of Amazonians. But, it was the right approach and that’s what allowed Amazon to accelerate. In fact, I’ve posted and if I could do a plug, I posted a blog about this on LinkedIn that Amazon was the OG on headless. And, they just don’t want talk about it. That’s not something you talk about, it’s something that’s unique to them and spoke to their platform. Others came on board with microservices later, we did at Staples. And back in 2013, we decided we want to decommission WebSphere, because it was just a massive blocker to our growth. And over the next three years, we moved off of WebSphere and moved into an architecture that looked very similar to what Amazon runs.

Julia Raymond Hare:
And, just out of my own curiosity. So, if you are with an incumbent like Magento or another player, and you want to move on to a platform like Fabric, I mean, what are the barriers there? Is the cost huge? I mean, it sounds in some ways like retailers don’t really have a choice, because headless is going to be the predominant technology of the future, so you have to get on board, little [inaudible 00:14:44].

Faisal Masud:
Yeah. I mean, the cost is a lot lower than you staying with Magento, so number one. If you look at the full TCO with Magento, you’ve got developers, you’ve got some on-prem, infrastructure, you’ve got some in the cloud. You probably have a designer, product manager. You’ve got a bunch of folks running the shop. And typically, whenever we come across a Magento customer, we have yet to find someone who is excited about staying there. We discount deeply implementation costs, because that’s not really creative to our company. Wherever we can jump in to reduce those costs, and move them over to sort of commerce as a service with Fabric, we do that. So, it’s actually not that expensive. Just to give you an example, if you’re a $50 million retailer running on Magento or even Shopify and you want to move over, it probably from an implementation perspective, we will eat a lot of that cost and you will not pay more than low six figures or even lower.

Julia Raymond Hare:
Wow. Cool. And, we’ve talked a little bit about some of the favorite retailers, I guess, the largest, the Walmarts, the Amazons. And, I feel like we can’t have this conversation without bringing up Target. And, Jeff I’ll pass it to you real quick. What’s your take on Target when you think about what’s their role, because obviously their sales numbers were out of the park, and they continue to delight customers in every sense of the word.

Jeff Roster:
Well, if you took out Amazon and Walmart from the conversation and just talked about Target, you would be looking at an amazing retailer doing almost everything correct. The problem Walmart has is you have two that… The most aggressive, the most innovative retailers on the planet, certainly from a tech [inaudible 00:16:26], Walmart from a supply chain excellence, Amazon from a everything excellence. And so, it almost looks like an afterthought. But I mean, they’re doing it right, they’re doing exactly what they need to do. Their e-commerce is improving. I mean, I’m not the biggest fan of target.com…

Faisal Masud:
We have a Coffee & Commerce, Jeff, in case you want to see it.

Jeff Roster:
By the way. Former analysts, I would never, ever, ever said this when I was still a analyst, but every one should listen to Coffee & Commerce, it is probably the best podcast I’ve ever seen. You basically have engineers kind of walked through retail websites and just with a hot mic and it is unbelievable, amazingly good stuff. I just challenge retailers, listen, don’t… Just listen to people that know what they’re talking about and fix your websites, because a lot of them are very poor. I’m probably the only guy in this country that actively tries to not shop at Amazon. I finally broke down. I am now an Amazon Prime member, but I want to shop retail and to see how the business is evolving. And let me tell you, most of the retail websites are not very good to be honest with you. So…

Julia Raymond Hare:
Well, hats off to you, Jeff, for holding out that long.

Jeff Roster:
My wife’s actually mad at me because she’s even worse than I am or better than I am, I guess, in that regards. But, it’s important to understand. I mean, how can you talk about retail if you’re not shopping the channels and it is difficult. I mean, every single Amazon purchase I’ve ever done, I’ve tried to go somewhere else. And, oh well.

Julia Raymond Hare:
Yeah. And Faisal, when you are on Coffee & Commerce and you’re dissecting these sites, as Jeff was mentioning, you have some really, really good ones where you’re calling out like Williams-Sonoma and some other retailers, is that all totally live? So, you’re not even looking at it before you’re recording or do you look for the bugs first?

Faisal Masud:
Oh yeah. No, no, no. So, we mix it up sometimes. So Ryan, our co-founder did Williams-Sonoma. eBay was the CTO of Restoration Hardware, Prakash Muppirala, who is also an ex eBayer with me, the two of us did that. We did GoPro with Raj Desai, who was also an ex GoPro employee. And then, we did Target with Libby, who’s an ex-Target and Amazonian. So, we try to mix it up and do it completely live, so we land on the site and then Rob walks the guests through the process as far as what are we going to do. And, we’ve structured it in a way where we’ll land on the landing page, we’ll go through the listing pages, search, cart checkout and browse, and just sort of go through the experience. And yeah, it’s completely, like Jeff said, it’s a hot mic. And, there is no preparation at all. No.

Julia Raymond Hare:
Cool.

Jeff Roster:
Well, congratulations. And, because there’s no foul language, so probably quite an accomplishment.

Faisal Masud:
We try to warn beforehand. But, if you see the eBay one, and we try to summarize in the end, what were the big takeaways, and those takeaways you’ll see that these companies have just missed out on just the most fundamental, basic things. I mean, you can’t shop on ikea.com, it’s just unbelievable. It’s such a bad experience. But with eBay-

Julia Raymond Hare:
I will agree with that.

Faisal Masud:
Like you go to the store and it’s an amazing experience. IKEA is de facto, one of the best experiences you can go to go buy anything for your home. But when you come online, that doesn’t translate quite as well, because they just, again, it’s probably designed by consultants or whoever else, they haven’t done it themselves. With eBay, it was interesting because they moved away from PayPal. And now, if you go to the checkout, they’ve got like four or five different payment options. Customers don’t want that complexity, they want simplicity. And they want to just know like, “Okay, how do I just get out of here?” And so, we try to make it as simple as possible in Coffee & Commerce, but at the same time, we don’t try to sugar coat if there’s an issue.

Julia Raymond Hare:
What do you think the biggest offenses that you see on these websites?

Faisal Masud:
One that should be eliminated as the ForeSee pop-up. I don’t know what it takes to get rid of that, but I don’t know how Nordstrom, we did Nordstrom as well, by the way Jeff, in 2021 still has a pop-up that says, “How am I doing?” Like, I’m in the middle of my checkout, what are you doing? Who instrumented this? Like, what logic did that take to put that in my face when I’m about to click checkout? So, it’s things like that.

Faisal Masud:
Number two is this, a lot of latencies introduced when you have those pop-ups when you land on a site and it says, “Oh, 15% off, give me your email.” Those interstitials sacrifice your speed. So, it’s also interruption of a journey. We always believed that interrupting that purchase flow is the worst thing you can do with a customer, because you’ve barely got seven, eight, 10% conversion if you’re good, why do you want to get in the middle of that whole purchase funnel? And, we see a lot of retailers still doing that. Lastly, I’ll say on the checkout page, having live links. I don’t know how it’s 2021, all these websites, you can click any live link on the checkout page and still leave that page [crosstalk 00:21:47] amazon.com. Go to amazon.com, there’s not one live link that you have to click the browser back button. There’s no way to get out of that page.

Julia Raymond Hare:
I never thought about them. That makes a lot of sense though. I mean, it’s logical.

Faisal Masud:
Yeah. I mean, if you’re there to…

Julia Raymond Hare:
I mean, it’s logical.

Faisal Masud:
Yeah. If you’re there to shop, right, and you have decided, “I want this. It’s in my cart, I’m at the checkout. I’ve put in my credit card, I’m ready to go,” why would you give them anything to leave that page? You shouldn’t, and a lot of sites still do. As you see some of the videos, when you get a chance, Julia, you’ll see that we call out similar themes of issues and a lot of websites. You would think product management, but part of this is because there is no strong product management. It’s project management. It’s an agency design.

Julia Raymond Hare:
Sure.

Faisal Masud:
It’s not customer-led. It’s not data-led. It’s led through observations and ideas that have been read instead of studied. So, that’s where having spent 20 or so years in commerce, it just comes naturally to us, but it doesn’t to everybody else.

Julia Raymond Hare:
Sure. In this exercise, you have a lot of people who were at those companies, like you mentioned GoPro and Target and Amazon, eBay. It’s not really a marketing plug or is it to do these Coffee and Commerce shows where you’re picking out where things could be improved. Is that like a clever way to market a shop or is it just for fun?

Faisal Masud:
It started off with fun. But as we go through the exercise, we quickly realized like, “Wow, if they had this component or that module, they could do better.” So in the writeup, Rob would typically put, “Well, if you did these things, you could improve your experience.” But no, the intention is to educate people on what good product design is, what does a good commerce experience look like and why it should look like that. While they do that, if they think there’s value that a fabric can add there, sure. If they don’t, that’s totally fine too. We’re just providing a service.

Julia Raymond Hare:
It’s almost like a free expert review, so they are getting value of it. If you haven’t, maybe all, take those links and reach out to people I know at those companies and be like, “Hey, did you check this out?” Because I think it’s interesting, they should be looking at it.

Faisal Masud:
We’ve had a couple of CEOs reach out to us. We’ve had a couple of team members who have designed those pages reach out to us too and ask us, “Okay, what else would you think we should replace?” We provide free advice.

Julia Raymond Hare:
That’s really cool. Well, I know we talked about Target just a few minutes ago, do you think Amazon should be concerned about Target?

Faisal Masud:
I’m not sure if Amazon should be concerned about Target. It should definitely see Target as a company that it’s possible Target’s customers love Target more than Amazon’s customers love Amazon. That should be something Amazon has probably kept an eye on already. I know we did back then. But, what I will say is Target has done an unbelievable job at building out the Tarjay and the upper end Walmart sort of experience where you can be a Gen Z or you could be a Gen X or whatever. The affinity that customers have towards that brand, it’s pretty unbelievable. They’ve maintained that status throughout where if you look at their private label, they have just killed it with their private label. They’ve done an unbelievable job and building out a book of business that the quality is amazing. It’s not private label to be the cheaper version of what you need. It’s more you’re actually upgrading what you’re buying and buying it at a lower price.

Faisal Masud:
So, Target’s created an ecosystem within their customer base that they trust the brand. They trust the service levels. With their returns policies recently, I’ll give you my example. I bought an Xbox and bought by mistake the one that was just the digital one versus came with the drive. The box is open. Typically, at Amazon, you have to pay a service fee if the box is opened on video game consoles, at least from what I recall. Maybe they changed that now. But, I walked into Target, said I don’t want it, no questions. They took it back. So, I think returns are the most important marketing tool you can have. Returns is not a cost center. It is a marketing approach. I think Target’s done a really good job. Nordstrom led the way early on. But, I will say that they… When Prime Now had come out, everybody was fearful that there goes Target’s business because Prime Now is serving all those items that Target served. But, it didn’t even make a dent from what it looks like because they’ve just maintained their overall ethos.

Julia Raymond Hare:
Yes, and they did just come out with another private label, I think a month and a half ago, called Favorite Day. That’s a food label and we’ll see how it does because its other ones are knocking out of the park. I want to shift a little bit on consumer behavior. You guys are both really smart. I wonder what your thinking in terms of what are the long-term consumer behavior changes that we’re going to see as a result of the past year plus?

Faisal Masud:
From my perspective, there are a few corrections along the way, which was we thought Alexa would be a game changer and voice commerce will be extremely big. It hasn’t really done much yet. There’s still hope, but it’s not been… I don’t know, Jeff, how you feel about this, but it hasn’t been at the trajectory that one had imagined when Alexa has come out. It’s still basically a music and radio and ingredients tool. It’s not really the value of Alexa from a commerce perspective has not been extracted to the degree you would expect. So, I would say commerce would become a lot more subscriptions-oriented just because people are buying the same thing, stuff over and again. But, we’re seeing that already. But, the seamless experiences with drive-throughs and dark stores and faster delivery, you can imagine Prime being same-day very soon.

Faisal Masud:
I’ve gone the other way. In my case, I actually select, put all my packages into one package and ship it on a Wednesday because people are getting sick of the dunnage that they’re receiving every single day. So, there’s this dark side of commerce too, which is all of this packaging material, which is just a not earth-friendly and also just a lot of stuff to take care of when the products arrived. So, I would say you’d see a change. They used to be a program called Amazon Tote years ago. I don’t know if you guys have heard of it, but it was essentially you would get a tote with all your stuff in it without the big boxes. I think with the amount of velocity you’re seeing with purchasing from Amazon and transactions, you could imagine a day where you don’t really need the over box. You don’t really need to do all of that. You could just either pick up your stuff locally or not have to deal with that extra stuff in the supply chain.

Faisal Masud:
So, I would say that’s one. Second is just not seeing enough momentum on some of the other channels. I know video commerce is becoming a big deal and people are talking about it a lot. TikTok influencers are killing it on particular products. Gen Z, yes; everybody else, not so sure. I still think that YouTube is going to try to make some inroads on v-commerce, but we still have a little bit ways to go unless you can have the buy button right there and product arriving right away. You’ve still got a lot of friction, like you place a Shopify order, you forget you placed an order because I don’t know where it is. It’s going to arrive at some point and they have an app for you to track orders. Right?

Faisal Masud:
So, we’re still living in a bit of a draconian process where you have a competitor that has to tell you when the product is coming and you have Amazon where you never have to even think if the product’s going to be at your door on time. So, I think those things will get streamlined. People will get better at it and last-mile logistics is going to play an incredibly important role. Because in my opinion, retail is logistics. That’s essentially what it is.

Julia Raymond Hare:
I love that you brought that up because I just had that poor experience of their day where I ordered something and I was like, “Man, when is it getting here?” I went to look up the arrival date. And then, I had to copy and paste this long code into the shipping provider’s website to figure out if it had shipped yet, which hadn’t. It was just crazy. The Amazon, like you said, it’s just mindless. You just get it. You have confidence. Jeff, Faisal mentioned a few things like voice commerce, unpackaging being more sustainable, I think that’s where you’re headed with that, and then obviously what we were just talking about with living in a bit of a draconian state in that getting more buttoned up. What are some things that you’re looking at?

Jeff Roster:
So, I agree 100% on voice commerce. I can feel a couple of people just ready to the string me up because they’re far more bullish on voice. I’ve been married 31 years. When I’m looking for a camera lens, that’s multiple thousands of dollars. The last thing I want to do is announce to Alexa to look for that information. Also, I just don’t think it makes sense. I’m a huge conversational commerce person or a, what’s the right term, I mean social odium. I’m very, very bullish on that. I think there’s brand opportunity there, for sure. I’m huge advocate of taking out any kind of waste in the supply chain. So, I know when I was at Target and Mervyn’s actually, Target Corporation, we were working about clean up packaging, gosh, what, 25 years ago or so. Now, it’s sort of become vogue and cool while we were just doing it because it made sense. All you got to do is go into any distribution center anywhere and look at the amount of cardboard. Now, it’s not wasted, but it’s a huge amount of content.

Jeff Roster:
So, cleaning that up is not only good for the environment. It’s good for the bottom line. When things that are good for the environment and good for the bottom line are the same thing, that’s a great place. I’ve got a couple of data points from a recent survey, Faisal, that I think you’re going to be pretty interested in. So, it comes from a press release that Inmar just put out about a couple of weeks ago. I can’t speak to the methodology because I didn’t spend the $10,000 to get the study. But, the key find is their publish were interesting. 57% of shoppers would be open to trying out a drone delivery service or robotic delivery service. Next ballpoint, of consumers that have used contactless payments at checkout, 81% say they prefer it over cash. 75% of shoppers are willing to use technology that allows them to check out from their cart. Of those that have tried Amazon Go or a similar format at a grocery store, 76 prefer it over a traditional grocery store format, 76% of the-

Jeff Roster:
Grocery store format. 76% of the shoppers responded that they would be extremely likely to order from their favorite grocery stores at a convenient pickup location of their choosing if they were offered their choice of pickup time and, or had lower fees than doorstop delivery.

Jeff Roster:
So are those numbers right? They seem very, very optimistic. But I’ve always been an advocate of looking at data and thinking about the direction of it, as opposed to saying, “It’s not 57%, it’s 52%.” I don’t care. If it’s more than 5%, that’s a significant change.

Jeff Roster:
And I think what we’re going to see coming out of COVID is we have a fundamentally different consumer that finally appreciates the supply chain, which as an all supply chain guy, couldn’t be happier. Couldn’t be prouder of the retail supply chain in the last 14 months. It kept the nation fed, did phenomenal job. But we now understand that.

Jeff Roster:
And so, all of these services that a lot of retailers threw together in an immediate response, are going to become embedded in what the expectation is. And that just leads right into the concept of micro-fulfillment. I mean, we are looking at a fundamentally different retail experience. Some want high touch, some want no touch. Or actually, probably more want no touch.

Jeff Roster:
And so all these things, all these pieces of technology are going to come together to fundamentally transform how we do go about the business of retail. And you know my clarion cry is, boy, do pay attention. The consumer has changed. So I’m on the other side of the age range. I’m technically a boomer. I want contactless. I want technology. I want to know something’s in the store. I’m not necessarily… I actually like going to store. So I will never, ever use drone delivery.

Jeff Roster:
But I do want to know stuff’s available. I do want to use a lot of technology. I want to use video. I want to use audio. I want to use all these components to improve my shopping experience, to gain knowledge. And if you want to see the best example of video commerce, it’s not really video commerce. It’s more live streaming.

Jeff Roster:
Just take a look at B&H Photo. I’m a big camera guy, big audio equipment guy. Best, in my mind, the best camera store in the planet, with bar none. If you’re sitting in Silicon Valley, like I am, and they’re only one store in downtown Manhattan, you’d have to either maybe do a call or do a text chat.

Jeff Roster:
Now, somebody just simply turned on a camera. And so the last time I was looking at a multi-thousand dollar lens, hopefully, my wife’s not listening. And I ended up talking to Jeremy right there on the sales floor. And B&H is just a rock’s throw from Javits. Pop over and see what the guys at B&H are doing.

Jeff Roster:
And I had an amazing, technological conversation. Jeremy was showing the lens. Not only just showing the lens, but demonstrating the different focal points. I mean, amazing experience. And the video quality was terrible, to be honest with you. But I could care less because the content, the knowledge, was amazing. And so, that completely transformed how I’m thinking about social commerce.

Jeff Roster:
I mean, I was as an analyst, okay. I know there are some numbers. Blah, blah. I looked at that and went, “Oh my goodness, this is fundamentally transformational.” And the key is, that’s a retailer that is experimenting with technology and is very comfortable with not an optimal video image, but they are pushing the envelope. And this is exactly what every retailer does.

Jeff Roster:
I am willing to bet, within five to six years, I will be able to go into Lowe’s, Home Depot, anywhere where there’s a technical component, and I should be able to, just using the QR code or something, call up a content expert on that item. They don’t have to be in the store, but they have to be available.

Jeff Roster:
Now, if retail has embraced that kind of a concept, we can get into a scenario where we can keep our industry transforming and be relevant to a consumer base. I’m actually very bullish. I’m really excited as we come out of this. Because I see these data points. Now the key is just, who’s going to respond to them?

Julia Raymond Hare:
Who’s going to respond and who will the winners be? And Jeff, you brought up a bunch of also amazing points. You talked about touchless, contactless, video commerce, conversational commerce. And I realized, you mentioned drones and here we have Faisal who has very familiar with drones and led up Alphabet’s drone division. So, I feel like we could talk for hours.

Julia Raymond Hare:
Well, Faisal, Jeff, thank you so much for joining today. Where can our listeners get in touch with you or listen to your podcast?

Jeff Roster:
This is Jeff here. So, we are this week in innovation. So we’re available where all the best podcasts are available. So, we’re on Spotify. We’re on iTunes.

Jeff Roster:
So, check it out. We want to focus on the startup community in retail. We want to look at all these interesting technologies before they really become big. And if you’re a retailer and you want to talk to us, jump on. Let us know and we’d love to interview you.

Faisal Masud:
Yeah. And Jeff, I would love to, at some point, connect with you about your podcast too. On our side, it’s really, we do a bunch of different things at fabric, but our Coffee + Commerce is a regular. In addition to a few other things that are coming up and we’ll keep you posted. But if you follow us on Twitter, you can see all of that.

Julia Raymond Hare:
Thank you, Jeff and Faisal, for joining today. Hope you join again in the future.

Faisal Masud:
Thank you.

Jeff Roster:
My pleasure.