Amazon's Master Plan, Starbucks Bets On The Couch & Dollar General Pumps Up The Volume | Fast Five

The customer experience is never going to exceed the employee experience.

AI is the center of gravity.

We're not chasing AI, we're enabling it for everyone else.

We're not your grandmother's retailer anymore.

You can have a good plan, but without the right leadership to drive that, you know, you probably wouldn't be as successful.

They're finally investing in the system, not just the brand.

And that's why it's working.

That's why people come to Omnita, because they get the real inside scoop.

Hello and welcome to The OmniTalk Retail Fast 5.

Today's episode is another great example of what makes The Omnitalk Retail Fast 5 unique.

This week I'm joined by Jennifer Myers and John Benson of the AM Consumer and Retail Group.

I always love when the folks from A and M CRG join us because they are never afraid to share their thoughts about the headlines.

They don't mince words.

And for that reason, our conversations every month are just about the most well rounded and thoughtful discussions of the real issues facing retailers and brands.

Not to mention the fabulous Lightning Round which you're going to hear about at the end of today's show in which I asked John point blank if he is Team Alex or Team Alex as in Team Alex Cooper or Team Alex Earl.

I'm excited to introduce Jen and John into the Omnitalk family for the first time.

But before I do, let's take a quick break to hear from all our wonderful sponsors who make this podcast possible.

And each and every week, this episode of the OMNITALK Retail Fast 5 is brought to you by the A and M Consumer and Retail Group.

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Com that's V e L O Q2 newbies today, Jen Meyers and John Benson from the A and M Consumer and Retail Group.

I want to get to know each of you a bit first before we get to the headlines.

So, Jen, let's start with you.

Jen Myers spent the last, I don't want to say how many decades of my career working in retail and restaurants, both on the industry side.

Started out at Arby's and Jack in the Box and then did the fun MBA stint at night full time and then transitioned.

Yeah.

Because I don't enjoy sleep.

That's pretty obvious being someone who worked full time and then went to school at night and went into consulting.

So that's pretty much my vibe.

And then have spent the last decade or so in consulting.

Consulting for iconic retailers like Louis Vuitton and Neiman Marcus and Wendy's.

Okay.

Along with other brands that I can't mention.

But yeah, I've enjoyed my career in consulting and in industry and I'm really excited to be here and hopefully drop some knowledge over the next 10 minutes or an hour or so.

Yeah, yeah, no, yeah, we're gonna give it a solid hour, Jed.

But wow, that's quite the spectrum.

Louis Vuitton to Wendy's.

Okay, Jack of all trades.

I got to ask you to like, because I saw Jack in the Box in your background and being from Arizona, I'm a big Jack in the Box fan.

So I have to ask you, I have to ask you a couple of questions because I just can't let this go.

The Supreme Croissant sandwich.

Is that the best breakfast sandwich in all of fast food restaurants?

What's your take?

Well, being a Southern Californian, I'm partial to a breakfast burrito.

So, you know, I mean, I did live in Paris when I was in Louis Vuitton, so obviously the croissant part, I'm a little bit.

Yeah, yeah.

But yeah, I'm a big burrito lover.

Breakfast bowls, things of that nature.

So I have to say that breakfast burritos more my vibe.

All right, well, we won't get into the is the burrito a sandwich Argument but because I want to get to my other question about Jack the Box.

The tacos.

The tacos at Jack of the Box are some of the most underrated items I've ever had in my life.

What's your take on their tacos?

I think the tacos are great.

I mean it's, it.

I think they lean into the snack, you know, as an additional item to your current menu or you can make them a meal.

So I think the tacos are super versatile.

I used to love the monster taco as well.

But the 299 cents is not only a great deal, but it's a great addition to any meal and I think it's iconic.

When you think of Jack in the Box, you think of two tacos for 99 cents.

Yeah, you do.

Yeah.

But not that many people realize that.

That's so great.

I've not had the monster taco.

I got to give that a shot.

All right, John, let's let you in here.

Why don't you tell the audience about who you are as well and, and what you focus on.

Do you focus on everything as wide as Louis Vuitton to Wendy's?

I can't say I do.

So a little slightly different background but a fair amount of overlap as well.

So yeah.

So John Benson here, great to.

Thanks for having us on.

Really looking forward to the conversation.

So I actually started my career in the Marine Corps.

I did a short stint for about four years in the Marine Corps and then from there since then have been working in various advisory roles for the past call it 15 plus years or so.

But really focus on the food space, you know, so all things food, you know, so probably the majority of my time is in the, is in the restaurant space.

So I work with, you know, many different brands across, you know, mostly the limited service type restaurants, but you know, up and down the food value chain.

So food distributors, food manufacturers, CPG companies, so on and so forth.

But that's really where my passion is, is all things food, all things food related.

I've worked at a lot of different, you know, consumer, multisite, consumer facing brands.

Probably not, not the Louis Vuitton of the world necessarily, but, but lots of other great companies.

As well.

So, so that's a bit about me.

Yeah.

Well, we've got a lot of germane headlines for you, particularly then, given your background today, John.

That's funny how that works too, depending on what, you know, what hits the news cycle this week.

So I'm curious too, do you, do you kind of lean into the typical, what you see from those in the service?

Like, are you more on the op side of, of consulting?

You know, I, I think so.

I mean, I have a natural kind of affinity to, you know, you know, driving operational transformations, things like that.

But, but honestly, for me, you know, especially in the restaurant space, you know, a lot of these companies are, you know, I mean, it's a broad range, but there's a lot of kind of mid market companies that we work with.

So it's.

I always think about it, from the strategy to the operations and then the financials.

You got to get that whole equation right.

And that's really kind of where we, you know, advise our clients on and work with our clients to drive transformations or really across all of those three areas.

Right, yeah.

And whenever food's involved, the operational dynamics and the supply chain dynamics are always much more intense and involved in, say, other operations of retail, depending on how you want to look at it, of course.

All right, you two, well, thanks for that introduction from both of you.

That was really wonderful.

And Jen, thanks for indulging my, my passionate Jack in the box love affair that I've had since I was a young lad.

All right, in today's Fast5, we've got news on Starbucks unveiling its new uplifted store designs in Chicago while also rolling out bonuses and expanded tipping for baristas.

Burger King.

Oh, here we go, John.

Burger King going on a massive hiring spree on the back of its reclaim the flame turnaround.

That's always fun to say.

Dollar General's media network rolling out an AI enabled in store audio program to 1200 stores.

And old Navy reportedly developing a new freestanding athleisure format, one it's calling Old Navy Sport.

But we begin today with the one thing that no doubt many of you read this week, and that is Amazon CEO Andy Jassy's annual letter to shareholders.

Amazon CEO Andy Jassy published his annual letter to shareholders, and in it he laid out Amazon's sweeping vision for robotics, world delivery, satellite broadband drone delivery and ultra fast fulfillment.

Just, just, just those things.

And the one through line of the letter is Jassy's belief that progress rarely follows a straight line.

Arguing that durable companies must be adept at navigating inflection points, not just executing a single playbook.

Jen, what stood out to you most about Andy Jassy's 2026 letter to shareholders?

Well, as an AI led growth strategist, what stood out to me is that AI is at the center.

It's infrastructure is the strategy and everything from cost savings to logistics improvements.

It's really about fueling reinvestment into that long term machine.

And I thought it was really fascinating that they've shift from storytelling about the consumer to storytelling about the machine.

AI is the center of gravity.

It's not as much of a side bet.

It's embedded across AWS retail advertising and the clear message was we're not chasing AI, we're enabling it for everyone else.

He's very explicit that AI isn't a feature.

It's going to rein every customer experience and Amazon wants to power that across the entire stack.

Yeah, I agree.

Like that was, that was the key thing I took from it too.

Like this was all about we're, we're, we're the infrastructure company now.

You know, we're not, we're not your, you're not, we're not your grandmother's retailer anymore, for, for lack of a better way to put it.

Did you like the straight line analogy, Jen?

Did you feel like that worked for him?

I did.

Although I feel like Amazon's become a little bit more of a spider web catching us all then.

Oh wow.

Wow.

You Gwen Stefani, right?

She's the one.

The Spider Web song.

Yeah, I actually liked it.

I thought it was a good move from him too in the sense of it kind of gave him a personality.

It gave him a calling card which people will attribute to him too.

Like, you know, they'll start using that quote, they'll start, you know, trying to be like more like Amazon and explaining it as a rationale for innovation.

But yeah, I was, but I was taken aback by just how much they did.

I didn't discuss retail.

It sounds like you were too.

Absolutely.

I also thought it was interesting.

It reminded me of like the 1998 letter from Bezos.

So that reflecting that day one mindset, talking about like relentless reinvestment signaling this notion of like long term dominance over short term margin and it was reinforcing, you know, Amazon wins by out investing competitors consistently and it's really consistent with Amazon's DNA.

He's basically saying we're going to keep investing aggressively even if it pressures margin in the near term.

Yeah, yeah.

The one Retail thing I did pick up in there too was like they're going after the underserved communities, they're trying to get to grocery through the additional items, you know, in the basket of the trip.

And that does seem to be working on the margins for them against how their current business model also works.

John, what'd you think?

Did you have any other takeaways from the letter?

You know, I thought it was great.

I really liked it.

And actually I think what I, what I was attracted to or what kind of zeroed in on was the bit of the storytelling and the like the intangibles part of it.

You know, the, I thought the analogy on the straight line, the, you know, the path not being straight line was, was right on, you know, and I think we're seeing it across, not just consumer facing businesses, but businesses across the board in terms of disruption.

And you know, they talked about in terms of inflection points, but you know, it's happening across the board.

We see it in the restaurant food space, but there are these disruptions and you know, companies that aren't agile and are adapting are the ones that are unfortunately going to lose in that situation.

So to me it's that he talked about initiative, creativity, willpower, having to kind of drive that decision making and drive kind of how they think about their business.

So I thought what stood out to me was the intangibles and how apart from all the different business units that they run and that they're exploring and that they're investing in just how they think about, from an intangible side of the equation, their business.

Yeah.

So John, I'm curious, when I, when I read between the lines what you said to like, I'm also picking up that you kind of got the sense that he's just like a pragmatic, normal guy too.

That is just writing a letter and that's how it came across.

You do, is that, am I reading you right?

Yeah, absolutely.

And I think it's a quality of like leadership, you know, and you know, I don't follow him that closely to, you know, to really opine on this, but my take on reading that letter was, you know, it's a strong leader.

You know, strong leaders, you write letters like that, they make it personal.

They, they, you know, they exude empathy kind of in how they talk about themselves and the business.

So.

Yeah, absolutely.

Yeah, that's a great point too because one of the things I like when I read these things too is like, do I know where the growth is going to come from.

And he articulated it very well.

He used an analogy with an, I think it was an Australian or New Zealand band, you know, that's going to stick with us forever.

And we know, I read him at the outset, we know the four to five areas in which they're really focused on and those are real tangible growth areas too.

They're not like just some amorphous concept of like, you know, we're going to, we're going to win with, you know, selling more basic product or something which you hear about all the time in retail earnings reports.

So yeah, I think kudos to him for that.

All right, let's keep moving.

Headline number two, Starbucks is doubling down on its back to Starbucks turnaround with two significant moves this week.

The coffee chain unveiled its new uplifted store designs in Chicago and separately announced a new performance bonus program and expanded tipping options that could put up to 1200 more dollars per year into barista's pockets.

According to the Chicago Tribune.

On the store design front, Starbucks unveiled one of its first Chicago area uplifted locations on Cicero Avenue in the old Irving park neighborhood.

And it features, just wait for it folks, leather couches, cushy chairs, throw rugs, drapes.

I see Jen smiling in the background, neighborhood specific art and a decidedly cozier feel.

Well, it would have to if it has couches and cushy, cushy chairs.

On the barista compensation front, starting in July 2026, Starbucks will introduce a new quarterly bonus program.

Baristas and shift supervisors can earn up to $300 per quarter or $1,200 per year when their location meets or exceeds sales, operational and customer service targets.

And Starbucks is also expanding tipping options so customers can tip via credit and debit card through mobile order and pay and scan and pay at the register.

Previously, tips were only available on in store cash and card transactions and drive thru.

I did not know that.

All us store employees will also move to weekly pay, which is important starting in August.

John, on a scale of 1 to 10, 1 to 10, how confident are you that the Back to Starbucks plan is actually working as intended?

So I would say if you're forcing me to scale once, I'm bullish.

First of all, I would say are you okay?

I'm bullish.

So put bullish it maybe in eight.

I don't want to be overly confident and be completely wrong.

But look, I love the, the moves that the company's announcing.

First of all, just going back to kind of the comments about leadership generally, I think Brian Nicholl, you know I'm watching closely what they're doing on a daily basis, you know, at that brand.

I love the kind of the turnaround plan that they're putting in place.

But some of these specific initiatives that we're talking about here, I think are spot on.

You know, there's a.

There's a saying or an aphorism that we talk about.

You know, the customer experience is never going to exceed the employee experience.

You know, I think that, you know, the best brands out there in restaurant companies, like your Chick Fil A's and things like that, are known for investing in their teams and doing moves like this.

And I think that.

I think it's going to pay dividends.

It will take some time.

These things don't happen overnight, and it doesn't change kind of behaviors necessarily overnight.

But I think the direction it's going makes a ton of sense.

I've seen.

And actually, we've helped companies implement very similar incentive programs a lot of times.

In the restaurant space, incentive pay is limited to maybe a general manager, assistant manager.

It doesn't get down to the.

To the, in this case, the barista level or the supervisor level.

But I mean, we've.

We've done this for a couple of different companies to.

Frankly, I'll be honest with you, mixed results.

Sometimes the, you know, the baristas don't always think about it in those terms.

One question I have is the quarterly payout, you know, is that too long for a barista?

Where they say, okay, yeah, you know, they just think about it, you know, more in a shorter or nearer term basis.

That's some of the challenges that I've seen in the past with these types of incentive programs.

But to me, it's sharing back some of the benefits of what they're trying to drive in terms of efficiency and improve profitability of these units.

Sharing some of that back through these incentive programs with the baristas and supervisors, the people on the front lines that they need to help put in place.

The turnaround plan, to me is a great idea, and it's hitting on all the right messages.

So frankly, I'd love it.

Got it.

Okay, John, so based on your experience, I'm curious because they talked about three things.

They talked about, you know, giving more access to tips.

They talk about a quarterly incentive program.

They talked about weekly pay.

Which of those three things in your mind, given your experience, will be most enjoyed or liked by the baristas themselves?

If you had to guess?

My guess is that the baristas, it's going to be the weekly pay and the tipping.

Me too.

And then, and then for the supervisors, it's going to be the quarterly incentive.

You know, I think that's just how, how, you know, different people in different stages of their life and different stages of their career, that's kind of just how they think about it.

And so, I mean, who knows?

I mean, but that, that would be my guess.

And John, why, why is we, we could pay seems pretty differentiating, but it also seems like that's where my head goes too.

Like that's what, if I was an employee, that's what I would want.

What is it that, what is it that generally prevents like retailers or QSR operations from just doing that to begin with?

Or do you think we'll start to see a move in that direction?

So I've done a lot of stuff in my career.

One of the things that I've done, and I won't get into all the backstory or whatever on it is help very frontline in the weeds payroll processes where I was basically helping prepare payroll files and all these different things for certain brands that I was working with.

And I'll be honest with you, it sounds simple and it should be simple, but I think for a lot of companies, some of these processes are, it does take time and some of them are manual.

You're managing exceptions because if you're thinking about weekly pay, that means you got to close out the hours and all that kind of stuff and get that correct.

So it does.

Having to do that on a weekly cycle rather than a bi weekly cycle, it just adds twice as much work overall for the managers and the people who have to go through that process and process all of that.

So to me there's an element of just kind of back office work that needs to get done to do it.

So it doesn't come.

It's not as easy as just flipping the switch or whatever.

There's work to do on it.

So I think a lot of it is very practical considerations like that.

But you know, I think they're doing the right thing to say, okay, we're going to do that, we're going to invest in kind of, you know, putting resources and time behind that because we think it's going to make a difference to our teams and hopefully that is reflected in how they interact with the guests and, and implement the different aspects of the plan that they want to.

That they want to do.

Yeah.

So I mean, I think it says a lot about Starbucks too that they're willing to unwind years and years of doing it at the scale that they are doing it because there's going to be a cost to put this into place, like you said.

Yes, but they're, they're, they're taking on that cost and trying to do this for the benefits of their employees.

All right, Jed, I'm curious, are you as bullish as John, though?

John gave it an eight.

John gave it an eight.

I think you can tell which way I'm leading.

I'm not quite as bullish, but I want to go to you first.

So like a scale of 1 to 10, how bullish are you on the back to Starbucks turnaround plan?

I wouldn't give a number, but I'd say I'm cautiously optimistic.

They're so above a five.

All right.

I would say closer to where John is.

You know, they're improving, but it's not proven yet.

So I want to see how it plays out.

I think the biggest challenge for Starbucks today is it's really three businesses.

It's a cafe experience, a drive thru QSR and a digital pickup model.

I was looking into it and about 60% of their transactions touch the store, but only half are actually people enjoying the cafe, while the other half is mobile pickup.

And then Obviously the remaining 40% is drive thru.

And so these are very different and often competing needs.

So they're doing the right things, they're reinvesting in partners, as you guys mentioned.

They're simplifying the experience and bringing back the original notion of the third place.

But that tension is going to be the high, that highest ticket experience being in store.

It's actually the least efficient.

And while drive thru and mobile are what really are driving the throughput and profitability.

So my bullish, my, my.

I would say leaning towards the bullishness of John is I think they've rediscovered the soul of the brand.

But the question is really going to be whether they can operationalize that at scale.

Yes, yes, I 100% agree.

And I think, you know, when I came into this I was like, I was like a five because I was like, I was like right in the middle.

But I think talking to both of you, I'm kind of pushing it up into the 6 to 7 range because I think, you know, you know, as John, you are ticket, you had the quota quote of the show so far, which was the thing you said about, you know, customers in relation to employees.

These are the right moves for the employees.

And so Jen, to your point, like, even though, you know, less and less customers are coming into the store, Every day you still need happy employees to run the operations for mobile pickup and a drive thru.

And that's fundamental.

So I like that in terms of the strategy, but the one thing I just keep coming back to is no matter how hard I try, every time I interact with Starbucks now it is through the mobile app.

And so that is going to become an operational throughput.

You did the same thing, right?

You've got your coffee cup right there.

And so like that's going to become an operational throughput issue over time, the more and more people you push through that.

And I just don't know that this is enough.

There has to be more things than cozy couches and soft leather sofas and things like that to ameliorate that problem.

But Jen, I'll give you the last word here.

Yeah, I mean, as you mentioned, they're trying to essentially determine will that draw customers in.

Right?

Like, is that what customers want anymore?

Are they leaning back into the original notion of Starbucks, which is much more experiential, or do they prefer things to be transactional in nature, like the mobile order pickup that I have in my hand?

Right.

Yeah, the Venti, I might add to that.

Looks like a Venti.

It's early in California.

Oh my God.

Yes, you're.

I didn't ask you guys.

You should ask you guys where you are to start off.

Yes, it's very early.

Oh my God.

Fair play to you, Jed.

Man, the.

The traitor.

You need to get the traitor next time.

All right, let's keep rolling.

Headline number three.

Oh my God.

She's got two of them, folks.

All right.

Oh my God.

All right.

Headline number three.

Burger King has launched a nationwide hiring push aimed at bringing up to 60,000 new team members on board across its nearly 6,500 US restaurants, citing strong customer traffic driven by its multi year.

This is one of my favorite things to say.

Reclaim the Flame turnaround plan.

According to Nation's Restaurant News and a Burger King press release, the hiring push is being described by the brand as, quote, an immediate need driven by consecutive quarters of positive same store sales and traffic and what the company says is category outperformance over the past two years.

The Reclaim the Flame strategy, which was put in place in 2022 and expanded in 2023, included billions of dollars in investment across restaurant, restaurant, I should say remodels, operational improvements, menu enhancements, including a first in nearly a decade, Whopper Refreshed and the new brand positioning campaign.

There's a new king and it's you, said Tom Curtis President of Burger King, U.S. and Canada, quote, we've done the important work of strengthening our operations, modernizing our restaurants and listening to our guests.

And it's paying off.

Now we need great people to help us keep that momentum going, end quote.

John, why is Burger King suddenly the talk of the QSR industry, or at least it appears that way to me.

What is it getting right and how sustainable is its recent success?

It's a great question.

Yes, this is another concept, another brand that I, that is obviously doing a lot of interesting things at the moment.

And this is, you mentioned it, multi year turnaround.

This is not anything that, you know, is happening overnight.

But I think, for me, I think about Burger King and I think about them as a, you know, one of the aspects of the restaurant space that, or characteristics of it is this franchisee and franchisor model.

And Burger King I think is doing a lot of the right things.

And if I could say, maybe they weren't doing a lot of the right things for, you know, some time period, but they've really kind of started focusing on the right things as a franchisor.

And to me, what that is is just really taking leadership and investing in the, in the brand, you know, on behalf of all of the stakeholders, the customers and their franchisees and so on.

So there's Reclaim the Flame, which, you know, a lot of that is investing in like remodels, which, you know, if you think back to 10 years ago and kind of the Burger Kings that you went to or you saw in your local markets, you know, I think a lot of people would have experiences, say, okay, yeah, a little bit dated, you know, in need of a refresh, not necessarily always, you know, supported in the way that it should be.

So I think it was in some ways long overdue.

But I think that the franchisor Burger King has doubled down on this and has made an investment in kind of what they think the, that they needed to do to kind of help turn around this brand.

I think the other thing that's part of this story that, you know, there's a Reclaim the Flame, but there's also the acquisition of Carols, which was one of their largest franchisees.

And so it's about a thousand units, you know, of that 6,000 plus they acquired that franchisee and they're turning around a lot of those units and they're refranchising them to smaller, kind of more local, you know, in some cases, you know, better operating franchisees.

So they're just looking at the holistic business from the menu to the, to their, to their build outs and what this store looks like, to the operations, to their franchisee community and base and basically, you know, making, you know, pulling levers across all of those and doing exactly what a franchisor should do to support the business.

So to me, it's, it's, it's a, it's a lot of that.

So it's the turnaround plan, it's the acquisition of Carols, and then finally, I hate to, you know, hit it too hard, but at the end of the day, a lot of the stuff is just comes down to leadership.

And you mentioned Tom Curtis.

He's been driving that turn, that turnaround.

And I think, you know, in some cases it's just the right leadership in place to drive these types of transformations.

I hit the lottery with you two today.

My God, like some inside baseball on that.

That's why people come to Omnita because they get the real inside scoop.

Yeah, I mean, I mean, John, like you talked about Tom Curtis, like, because that's what I was, I was going to ask you, but then you said at the end I was going to.

My follow up was my follow up question to you is going to be like, how much of this is leadership?

Because it really feels like this guy knows his stuff.

Like he has a true operational background at Domino's.

I talked to somebody that I know and respect who works there at nrf and I said to him point blank, I was like, you know, because he was doing that whole, like, I'm gonna spend four hours a day letting customers call me at the time.

And I think we talked about that with the A and M folks when, when they were on during that month.

And I was like, is this guy for real?

And he's like, dude, this guy is the real deal.

This guy is legit.

And I was like.

And this guy wouldn't blow smoke up my.

You know what?

So I was like, all right, man.

And that, and it seems like that is the case.

So, so, so you think this is definitely a function of leadership to some degree as well.

So it's the right branding, but also the right operationals, right operations, and the right leadership focus.

All three kind of intertwined.

Yeah, I think that's right.

I think it's a bit of that trifecta, you know, and you could have the good plan, you could have the Reclaim the Flame, you know, plan in place, but without the right leadership to kind of drive that, you know, it probably wouldn't be as successful.

And you know, it's it's the whole company.

It's rbi.

The.

The parent company in, in general, willing to make these investments.

I mean, they're obviously investing a ton of money in these remodels, you know, but I think, you know, they're seeing, you know, 20% lift, I think sales lift on the, the model, on the units that they've remodeled.

So, you know, it's.

It's being bold, and that's part of leadership, too.

Being bold and, you know, being willing to kind of make, you know, big bets on certain things.

So I think it's.

Yeah, it's all of those elements to a certain extent, coming together as a, for lack of a better word, the perfect storm to really kind of, you know, do some of these things.

Yeah, no, I mean, I was actually struck by.

I was in a Burger King recently when I was on spring break, and I was struck by just how clean and well run it was.

I went to one at the airport, too.

Same thing.

Which is a hard business to run.

But, Jen, what are your thoughts here?

Any.

Anything you would add, any disagreements you might have, Any, any contrarian viewpoints here?

What do you, what do you think?

I mean, it would be very hard to argue with John here.

I might try, but no, I think Burger King's doing the right thing.

They're finally investing in the system, not just the brand, and that's why it's working.

You know, as a former marketer, when I look at it right now, the momentum, it's not coming from marketing, it's coming from fixing the fundamentals of the system.

And what I think is really different this time when compared to competitors.

You know, McDonald's has always been best in class operationally, and Wendy's has leaned into more menu innovation and pricing.

But Burger King had fallen behind in execution, and now they flipped the switch on the flame.

And so this is about catching up on the basics, you know, and I think the early results are super encouraging.

The question will just be sustainability.

Can they maintain this level of discipline or do they drift again over time?

Right, right.

All right, well said.

All right, let's keep on rolling.

Headline number four.

Dollar General's media network announced this week that they are rolling out an AI enabled in store audio program to approximately 6,000 stores across 48 states through a new partnership with Cusic, a move that will double the discount retailers existing in store audio footprint and bring the total number of Dollar General stores with audio capabilities to 12,000 by the second quarter of 2026, according to retail Dive.

The Cusic platform Combines point of sale data, curated music and AI generated audio ads to deliver localized real time messaging tailored to each store environment.

The platform is designed to give brand partners improved attribution and performance visibility.

Q6 closed loop reporting capabilities aligned with IAB standards, enabling advertisers to measure incremental impact and link campaign exposure to actual sales outcomes.

Jen, is AI powered In Store Audio?

This is a little bit of a leading question.

Is AI AI powered In Store Audio the most underrated retail media channel out there right now as we speak?

I think it's underrated, but it comes with real risk.

The upside is it reaches customers, you know, at the exact moment of decision in store.

You know, it's incredibly powerful and especially if you think about Dollar General's like value driven, mission based shopper.

But to me, I think it could inherently annoy customers if it's not done well.

You know, audio is interruptive, right?

It feels like advertising instead of something helpful or timely.

And if it, and if it really turns in that vein, people will tune it out quickly.

And I was thinking about this, but the other piece isn't just that customer experience play, it's truly more of a monetization play.

You know, when you think about like retail media networks, they're building it out and I think that's a high margin revenue stream layered on top of a very low margin business.

So this is really about turning the store into a media channel and the question is whether they can do it in a way that adds value instead of noise.

Right, right, right.

Which is interesting because you know, as you look at In Store Audio, In Store Audio in Europe is a much bigger thing than it is in the United States.

And so then, and that's kind of, and the, and I think the reason for that is what you're saying, right Jen.

It's, it's the brand.

It's like, do we want that as we're shopping?

But, but I mean you guys, you guys are Both experiencing in QSRs and, and you know, convenience operations and Dollar General, like the dynamics in some of those retail environments are different than say like a department store.

So.

So Jen, like how much do you think that fear is real versus like is this just something we think is out there?

I think it depends how different the US consumer is to those abroad.

And it basically this will work if it feels like guidance, but it'll fail if it feels like advertising.

So I think we have to make sure that it's truly additive to the experience versus a distraction and creates too much noise for the consumer and actually is a detractor from the overall experience and makes them want to go somewhere else.

So how would you.

How if you're going to.

So, so, so granted, you said you think this is an underrated approach to retail media and for the reasons it's underrated is like you get a lot of like relative to like a digital screen, which is what I always come back to, to.

Right.

It's much cheaper than putting a digital street in your store.

It's much easier to operate.

It gets you more impressions too, because it hits everyone versus whoever's just seeing the digital screen.

You can align it to your point of sale.

Those are all the benefits of it.

So like.

But taking take that with a grain of salt, if I'm hearing you right, is like, okay, you know, but at the same time, like, it could be more disruptive to my shopping experience than just passing by an ad on a digital screen.

So if you were to do it, what type of ads would you try to place in this underrated or underappreciated retail media network?

I think they're ads that would appeal to folks senses.

Like you said, we're shifting from screens to senses.

And so in that moment, how are you appealing to the consumer and helping them make a better decision and resonating in that moment of the journey versus coming across as like a pure advertisement that feels distracting or disjointed from the moment in the store?

Yeah, I kind of, look, I kind of actually, I find a lot of analogies from what the convenience stores are doing at the pump, you know, like highlighting their deals of the day.

Like, do you just give your deals of the day every hour?

I'm the hour.

And just see what happens, you know, as an experiment, see what the responses are from the customers, see if they vote with their wallets and, and, and you know, go from there.

But I think it's a quick, easy win to try to understand or, you know, hey, did you remember to get your flu shot this year?

You know, stop by our pharmacy if you've forgotten to do that, you know, like all that type of thing.

But John, what do you think?

Are you.

Where do you come down in this argument?

Yeah, I think generally speaking, you know, the retail media networks, broadly, huge opportunity.

Right.

And I think this is another channel, another example of that Dollar General is offering.

I think the thing that the nuance that I think about is it's also about the brand partners and like, where they are wanting to invest.

And I think, you know, fundamentally there's A limited amount of trade spend that they're going to, you have to invest behind their products.

And I think you know, you need to think about right now, you know, you can do a lot with that trade spend.

You can invest in retail media networks and push certain, you know, marketing messaging to consumers, try to engage them that way.

And you can also invest in discounts and promotions and things like that.

And I just think about, you know, what is going to be the most effective right now and have the highest return on, on those trade spend dollars.

And I think about the consumer and the consumer is, you know we see it all across consumer facing industries.

They're, they're a little more reticent, they're a little bit more being more intentional on where they're spending.

You know what is going to make the most, what's going to have the best return for them?

Is it going to be focusing on promos and discounts and so on or is it going to be investing in some of the new channels on the retail media networks that are opening up?

I don't know.

Right, right.

Yeah.

No, I think you know at full disclosure here for the audience, I mean most people probably know this to listen to me.

I'm an advisor for Juki which is in this space.

So I was actually pumped to see this announcement from Dollar General because it validates what I've been saying for a while that in store audio is an untapped part of the media network.

And I hear you, I, you know Jen, I hear you too.

I mean I think that's always the question I have too is you know, how will it resonate with the brand.

But to me I think like there are retailers where there people are just not going to be as concerned about that.

Dollar General, the right regional grocer which already has kind of an advertising positioning with their clientele on a regular basis, convenience stores, like I said with the kind of gas pump analogy that's already out there and it is a way of life in Europe.

So I always ask the question like why are we so different than Europeans or are we just slow to the game here?

Because it is a much, it is a much easier way to attribute and drive sales via in store than say all these expensive, you know, activations that we're seeing.

So I think for me it would be step one in my retail media exploration or experimentation plan.

100%.

But Jen, what do you think?

I think the most interesting thing will be how it connects with younger generations like Gen Alpha.

They've grown up just in this influencer centric environment.

And they see influencers as their friends or folks that will just sell them things.

And they're okay with that.

They're okay with more of this like advertising centric way of communication.

So I think this could work really well with Gen Alpha because they're going to see it as additive to the experience, whereas it might be a little bit more polarizing for older generations as well.

So less of the US versus European centric and more, I think it'll attract the important younger generations, potentially even more so, and resonate with them at a higher altitude.

Well, that's really interesting too.

And John, the other point too, I never thought about the dynamics of young versus old.

There's also the macroeconomic climate right now, like experimenting with this type of thing, even if it's promotional, could go a long way with a lot of your customers at the end of the day too.

Right.

Like, so if you're going to try it, it seems like the next couple of years with everything going on with, you know, oil and cost of food and all that, this is ripe for experimentation, right, John?

Yeah, absolutely.

So in the, the pressures that you pointed to on the consumer side, but then also just like the level of competition, you know, within this space is also, you know, you know, hyperdrive right.

Right now.

And you know, you mentioned convenience stores.

You know, there's, it's really the ecosystem of, you know, discount retailers like your dollar generals, this convenience stores, it's grocery, it's restaurants.

They're of all kind competing for the same consumers and customers.

And so it's hyper competitive environment right now.

There's a lot of headwinds on the consumer.

So absolutely.

I think companies need to get creative on how they're going to compete and win in that environment.

The macro environment is absolutely not easy by any means.

That's the understatement of the show.

You got the quote of the show and the understatement of the show, John.

All right.

Old Navy headline number five, Old Navy is replaced.

Reportedly set to launch a new freestanding athleisure format later this year under the sub brand name Old Navy Sport.

According to wwd, Old Navy Sport is expected to include leggings, sweats, sports bras and T shirts.

And Old Navy declined to comment in response to the story.

And Gap Inc. Said only in response that we don't comment on rumor or speculation.

End quote.

I always love when I see that for context.

Gap Inc. Has said Old Navy is the nation's fifth largest retailer by Athleisure Volume.

The competitive set spans from mass value to ultra premium.

And Old Navy is betting it can own the accessible end of the market.

More deliberately, the tension inside Gap Inc. Has got to be palpable because as many of you know, the company already owns Athleta, a premium activewear brand with its own store footprint and a different customer base.

Old Navy Sport, by contrast, is described as targeting a value oriented consumer with accessible price points.

John, Buy or sell Old Navy Sport becoming a legitimate disruptor in the athleisure market.

I'm going to hold, I'm going to hold on this one.

I, you know, I think I like certain things about it.

I like the diversification play.

I like, you know, maybe there, there's an opportunity, you know, there's a, there's a, an opening or Gap right now, like on the budget, friendly, accessible portion of this market.

So I think that there is definitely some potential here.

The thing that I, that I question is the, just the approach, you know, they're, they're basically, you know, branding as an Old Navy, you know, you know, words of branding and does that play?

You know, and I look at like, okay, they went with the Athleta, you know, was one way to grow into a certain part of the, part of the market.

You know, here they're trying to create a new format or potentially spin off on their brand.

I think about other concepts and like I said, I work a lot in the, in the restaurant space, you had McDonald's and you had Cosmics.

You know, Cosmics was trying to break off into a little bit of the, you know, the specialty beverage, you know, space.

There's no reason why you would think that McDonald's, with their scale and their success and, you know, their sophistication, that they shouldn't have been able to be successful with that, but they just fail to, you know, at the end of the day, gain a lot of credibility with consumers.

So I, that's where, that's where I think the risk is, is that, you know, you're creating a new brand, you're creating, you know, a new offering in a certain part of the market that maybe it hits with consumers, maybe it doesn't.

So that's why, for me, it's a, it's an intriguing move.

I understand the rationale behind it, but I think that there is some risk to it.

So would you do it if you were them?

Like, if, would you make this move if you were, if you were Gap in Old Navy?

I'm gonna go and say, no, I would not make this Move.

No, this is probably not where I would spend my dollars and resources and kind of thinking about, you know, on, on, on where, where to play and kind of how to win.

But, you know, that's, that's just me.

That's my, that's my, that's my gut reaction to it.

That's why we do this show.

All right, Jed, do you agree or disagree with John?

Would you make this move?

Finally?

I get to disagree with John.

Yes.

I mean, yes, the category is crowded, but more crowded at the high end.

You think of like the Lululemon's Nikes Vuori, right?

There's.

But I think there's still space in accessible, everyday activewear.

And I don't think that competes with Athleta either.

So the risk is really trying to be everything or just becoming a cheaper version of those premium brands.

But I think if they stay focused on a tight assortment, clear positioning and strong execution, there's a real opportunity to scale.

Yeah, I'm with, I'm with you, Jen.

No disrespect, John, but I'm with you.

Like, I think I've always loved this idea.

Like, I think, you know, it's part and parcel of Clayton Christensen disruption theory.

Like, things always gravitate towards the lowest price.

And I thought fabletics had a right to claim this space, to take this mantle, but they didn't and they haven't.

And, and my question is why?

And so when you hear the numbers that Old Navy's already, like, according to their reporting, who knows how true it is, but they're the fifth largest athleisure brand in the country.

Like, yeah, then this space is ripe for the taking.

And they have experience also.

Well, Navy has, and Gap has experience, you know, potentially working through the cannibalization factor of higher end brands, but still making a name for themselves in the category.

Because you're right, it's a very distinct, it's a distinctly different purchase than higher premium, you know, athletic wear.

So that's one thing I like about it, but the second thing I like about it, and I'm going to bring producer Ellen on this one, too, because she's going to know where I'm going as soon as I say it.

I think when you factor in the brand power of Gap, particularly, and what its CEO Richard Dickson also as the leader, can put behind it, you have to factor that into whether or not this can be successful.

Because, Ella, I mean, the new ad campaign sweat like this, I said that to you immediately when I saw that.

That's even before Old Navy sport.

That thing was so frickin hot.

Like, I mean it just blew your mind, right?

Like you and I are watching it together.

Like this is amazing.

Yeah.

I think my response to you was genius, period.

Yeah.

But it was so good.

And so if you unleash that brand power on what is to gen to your point and un tapped market that no one has really laid claim to, I think there's a win there.

But Jen, what do you think?

Close us out.

Yeah, I mean I worked with Richard back in the day so I oh wow.

He's incredible.

So if there's anybody who can do it, it's him and I think he's going to make a play and making a name for Old Navy in a similar fashion, but also after families.

Gap and Old Navy both have the ability to go after family.

So you get that athlete or athleisure breadth and depth.

That's hard to say, right?

Yeah, it's a mouthful, especially at this hour, but you get breadth and depth right across the family.

And I think that's also an amazing play versus some of the other brands that we discuss which tend to skew a little bit older or adult oriented or just are a little bit, you know, given the macroec economic situation that we were talking about, that's expensive to buy all of that athleisure for a family.

So I think it's the right play and again, I'm really happy that I get to have a counter to John's perspective on this one.

It's always good we get the debate going too.

All right, Jen, I've got to ask you because I didn't know that.

So what, what?

Because I've heard a lot of good things about him as well.

What makes him so special as a leader?

I think he's a visionary.

You know, what he did with Barbie was pretty impressive and I was excited when I heard that he was taking on this responsibility at Gap Inc. And so I think we'll see a lot more from him in the future.

Yeah, that's awesome.

That's great to hear.

All right, well, let's head to the lightning round.

Great show so far.

All right, question to you, Jen.

President Trump reportedly received a DoorDash delivery of McDonald's outside the Oval Office recently.

What is the strangest thing you have ever doordashed?

Well, it definitely isn't the two venti coffees that I got this morning, plus whatever else is in this mystery bag.

I would say I'm known for.

I'm known for over ordering and I Sometimes fast.

And so one day after fasting, typically, I don't know if you guys are like this, but in the last, like, hour or so, fasting, all I do is look at menus, particularly online menus, and figure out what I'm going to order.

And I placed an order from three different places, and I had so much extra food that I had sent the guy I was dating, who is now my partner at the time, home with a bag like this one.

And that's how she discovered our relationship is because she saw the bag in his fridge and said, who's Jennifer?

Oh, wow.

Oh, my God.

That's a great story.

That's a great story.

Oh, my God.

All right, John, next one.

Little House on the Prairie is getting rebooted by Netflix.

One, did you ever watch the original?

This is kind of an age question.

And two, will you be tuning in to see the new exploits of Ma and Pa and Mary and Laura?

Great question.

So growing up in the.

The Benson household, I had a lot of older siblings.

It was what I remember of Little House on the Prairie.

It was always on.

It felt like if I go back into my memory bank, it was, like, always on in the background.

But I don't know that I actually sat down and, like, actually watched those episodes.

Episodes, you know, beginning to end.

I have visions and kind of memories of Michael Landon, and I remember when, you know, he unfortunately passed away at an early age and things like that.

But it was not a show that I'm, like, really closely connected to.

That said, I now have, you know, three young children.

My oldest, who is 10.

My daughter is a big Little House on the Prairie fan.

She has all the books, and she's kind of read them all and all that.

So we will be tuning in to watch.

You know, she's read all the books, so now we can watch the TV show.

We'll definitely be tuning in to check it out and.

And show her some.

Some old classics.

You're all in for some wholesome family fun.

Jen, do you have a relationship with Little House on the Prairie?

I've never seen an episode other than this outfit.

I would say no.

Okay.

All right.

All right.

I'll take that for what you will.

Take that for what you will, folks.

All right, Jay, next one.

The Boston Marathon takes place next Monday.

Always a fun time in Boston, having lived there and experienced it.

Have you ever run a marathon?

I mean, I appreciate that you would ask me that question.

It's obviously because of my physique, but I haven't run a marathon I do feel like I've done a few in airports and client meetings, but not a true marathon.

Got it.

Got it.

Yeah, no, I think that's fair play to you.

I've never done one myself.

All right, John, last one.

Alex Cooper, Broker.

This is big, John.

This is big.

I hope everyone's sitting down listening to this or driving their car.

Make sure you focus on this one, everyone.

Alex Cooper broke her silence on her feud with Alex Earl this week, calling her out for starting, quote, fake drama in air quotes.

So are you Team Alex with an E or Team Alex with an eye?

So I got to say, I spend most of my free time when I'm not at work, you know, listening to these podcasts, so I'm very familiar with all the intricate details of this feud being facetious here, but, of course, you know, it's a really tough call, but I sort of look at this as, you know, as far as I can gather.

From what I understand, I think, you know, Alex Cooper is a bit of more of the, you know, original kind of, you know, the og, if you will, in terms of the.

These Pockets podcast and.

Or call.

Call Me Daddy podcast.

So I actually am sort of on Team Alex Cooper, but I would encourage Alex Cooper to take it easy on Alex Earl.

You know, she's.

She's.

She's.

You know, she's your protege.

You know, give her a little bit of mentoring and give her a little bit of grace.

You know, you guys are friends.

You know, kiss and makeup and.

And both do awesome things on your.

You know, on your podcast.

That.

That's my.

That's my unsolicited advice to Alice Cooper, but I'm on your side, Alex.

All right, all right.

Jed, do you have a horse in this race?

No.

I mean, I feel like John said it.

Well, it would be almost like if John and I had feuded, you know, like, we.

You can't ever slide.

You have to be neutral, I feel.

Yeah, right.

You just got to work it out.

You got to work it out.

Producer Ella.

Fabulous.

Producer Ella.

Fpe.

Do you have a.

Do you have a take here?

I'm pretty much Alex Cooper.

I think I'm with John on this one.

Are you two or.

Oh, no, you're going the other way.

On me because I. I'm chronically online, so I. I'm, like, fully in this debate.

I'm gonna pick Alex Earle.

I hate to pick sides.

She's a girl's girl.

That's why you just think she's got something.

She's got something.

To her arguments here, you just kind of just believe in her.

If for people who don't know the difference, Alex Cooper is the caller daddy host and she's very like CEO energy.

So she does a lot of interviews with like, the people that you'd want to scout interviews for the people who have those big stories.

Right.

Alex Earl with an I.

She is more the tiktoker influencer that just like takes you along her day and like, you feel like you trust her and your best friends, right?

Yeah, I just feel like I trust her and I'm her best friend.

Wow.

Part of me, they're both marketing geniuses.

So yeah, deep, deep down I'm like, what if they're doing this for a stunt and they're just going to be on each other's shows to that point?

I learned yesterday they both have the same PR agent too, which is fascinating as well.

So.

All right, well, with that said, great job, Ella.

Great, great extra insight into what is probably the most, the probably the least important topic, you know, in terms of the future of retail that we've discussed today.

But happy birthday today to the two, Emma's Thompson and Watson and to Biff Tannen himself, the great Tom Wilson.

And remember, if you can only read or listen to one retail blog in the business, make it omnitok.

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You can follow us today by simply going to YouTube.com omnitalkretail John, if people want to get in touch with you, with Jen, with anybody at the A and M consumer and Retail Group, what's the best way for them to do that before we let you go?

Yeah, definitely would to love to continue the conversation, you know, multiple ways, you know, reach out to us on LinkedIn, connect with us on LinkedIn, you know, you know, send us an email, first initial last name at Alvarez and marcel.com or go to alvarezmarcel-drg.com for our website.

Multiple ways to engage.

But we'd love to continue the conversation.

This is great.

All right, well, on behalf of the A and M consumer and retail group on behalf of producer Ella and myself and all of us at Omnitalk Retail.

As always, be careful out there.