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Cyberattack Protection, Shopping Assistants & Retail Media, and Albertsons Questions Everything | GrocerTalk · GrocerTalk

• 0:03
  Hello and welcome to episode 10 of Grocertalk.
• 0:06
  I'm your host, Ben Miller, and this week I'll be joined by not one, but two guests to deep dive into their areas of expertise.
• 0:14
  Grocertalk is brought to you with the help and support of Instacart Enterprise, Portager Fusion and Sifter.
• 0:26
  The speed at which retail moves is one of the things that's always excited me about this sector.
• 0:32
  And the events in the last week came pretty close to overtaking the planning that I've been making for this episode.
• 0:39
  Like many in our industry, I watched a cyber attack on French supermarkets unfold with horror this week.
• 0:46
  A malicious criminal action targeting cooling systems.
• 0:50
  It's a topic that I wanted to cover in appropriate depth today and one where a real subject matter expert will bring huge value to the discussion.
• 1:00
  So I'm delighted that at very short notice, Christian Beckner, founder and principal of Commerce Risk Advisory, was able to join us to help understand the implications of this cyber attack.
• 1:13
  And then in part two of the podcast, we're picking up another really important conversation.
• 1:18
  If agentic commerce and grocery does develop in the ways we've discussed, what are the implications on retail media?
• 1:26
  And to explore that, I'll be joined by Susie David Canyon, Vice President of content@eMarketer.eMarketer has long been one of my go to sources for e commerce insight, so I'm looking forward to exploring everything agentic with Susie.
• 1:43
  But first, cyber security.
• 1:47
  This week a significant cyber attack has hit multiple grocery retailers, especially in France.
• 1:53
  Look, this is a significant story in global grocery retailing and to help understand its implications, I felt the need to bring in some real subject matter expertise.
• 2:04
  So I'm therefore delighted to welcome Christian Beckner, Founder and principal of Commerce Risk Advisory and former Vice president for retail technology and Cybersecurity at the National Retail Federation, the nrf to the show.
• 2:19
  Christian, welcome to grocertalk.
• 2:21
  Thanks Ben.
• 2:22
  Great to join you today.
• 2:24
  Christian.
• 2:24
  Look, before we get into the events of the week, could you just give us an introduction for yourself and also the Commerce Risk Advisory, what you do just to give listeners a bit of color on your background?
• 2:36
  Sure.
• 2:36
  So, Commerce Risk Advisory is a new advisory consulting firm focused on helping retailers to address risk related challenges that they may be facing, including cybersecurity fraud, new types of AI related risks that are emerging across the retail sector.
• 2:53
  As you noted, prior to starting this company, I was at the National Retail Federation for eight years.
• 2:59
  I led a lot of their work on technology and cybersecurity issues.
• 3:02
  Led the member councils for CIOs and chief information security officers there.
• 3:06
  So a lot of experience working with retailers on these critical cybersecurity and risk related issues that I'm working to sort of now build filled out through some consulting and advisory work.
• 3:18
  Great, thank you Christian.
• 3:19
  Okay, before we go on, I just want to make it clear for all of our listeners, the diary pressures mean that we're recording this on Friday 16th October.
• 3:29
  It's currently mid morning ET when we're recording this.
• 3:34
  At this time this is still a life situation.
• 3:37
  So for example, the website of our whole deles's banners are still down as we're recording.
• 3:43
  So with that noted, Christian, can you take us through what we know so far about who was being impacted and how as a result of the attacks we've seen this week?
• 3:55
  Sure.
• 3:55
  And there's a few separate things here to cover.
• 3:58
  So first of all, and I think the incident that has been most high profile because of its unusual nature is the attacks against multiple retailers, primarily in France, against their refrigeration systems.
• 4:12
  Basically what this attack did was force a defrost cycle in these refrigeration systems, raising the temperature to 50 centigrade 122 fahrenheit and causing millions of euros worth of food to be spoiled, unavailable sale have to be thrown out.
• 4:34
  And so that affected multiple retailers earlier this week, you know, and still seems to be ongoing in terms of, you know, trying to understand sort of, you know, how that happened, who did that?
• 4:49
  The second incident that is still ongoing is a cyber incident at all.
• 4:52
  Hold Delhez.
• 4:54
  You know, as you noted, it's affecting its E commerce and you know, app activities both in the Europe and in the United States.
• 5:04
  These, you know, their, this online presence hasn't been, has been down now for, for five days as of, as of today.
• 5:12
  There's no indication that these two incidents are related at least based upon anything publicly.
• 5:17
  But you know, but given the, the circumstances that, you know, it is interesting that they are, you know, both occurring in the same week and then, you know, and then separately there have been, you know, several other cyber
• 5:28
  incidents reported this week against, you know, some European apparel retailer.
• 5:31
  So it's definitely been a busy week for cybersecurity incidents affecting the retail sector.
• 5:38
  Yeah, it really has and I think it's worth noting that is multiple different French grocery retailers that are impacted, intermarshe, systemou, Leclerc to name three.
• 5:49
  So it's, it is relatively widespread.
• 5:52
  Christian, look, what do we know about how these attacks might have taken place.
• 5:57
  So with respect to the refrigeration systems, it's been reported that these retailers were primarily using refrigeration systems developed by the company Danfoss.
• 6:08
  And if you look at, you know, some of the reporting in the last couple of days there, you know, this is a case where, you know, these were Internet connected refrigeration systems.
• 6:17
  There was a known vulnerability that was reported about a year ago, you know, that, that where, you know, companies that were using these were encouraged to patch and update their systems.
• 6:29
  You know, there was a.
• 6:30
  The, the company that, the cyber company that discovered this vulnerability had given a presentation on it at a major cybersecurity conference this summer.
• 6:38
  So the fact that there was this vulnerability was, you know, publicly known.
• 6:43
  And I think the question is, you know, did these companies not then, you know, implement this patch or implement these updates or, you know, or what else happened here that led to this incident?
• 6:55
  Okay.
• 6:55
  So the understanding at the moment is that the attack hasn't centered on the retailer's proprietary system, is through their hardware provider, in this case the refrigeration provider.
• 7:06
  And it's potentially a known situation where there was a patch available.
• 7:11
  So therefore the investigation will be, was that patch applied commonly?
• 7:15
  Is that, is that kind of correct in my interpretation, Christian?
• 7:18
  Yeah, I think that's correct.
• 7:19
  And, you know, clearly there would have been some, you know, retailers, grocers that did apply this patch, but, you know, the question would be, you know, did not.
• 7:29
  Did some companies not do this?
• 7:31
  And then if so, you know, why?
• 7:33
  Within sort of their broader sort of cybersecurity activities.
• 7:37
  Yeah.
• 7:38
  And do we know anything at this stage about who might be responsible?
• 7:42
  Kind of why?
• 7:43
  And I guess, stepping back, Christian, if you're a retailer, does it matter?
• 7:47
  Does the who matter to you?
• 7:49
  Yeah, so we don't know yet.
• 7:51
  And it does matter to some extent because that then helps to sort of infer what you should do next about particular.
• 7:58
  Sort of.
• 7:59
  So if you think about, you know, what are the typical motivations of cyber attackers, you know, most retail incidents, most incidents affecting the retail sector, the motivation is financial.
• 8:10
  So you see, you know, attempts to, you know, put on ransomware on, on IT systems, you know, other types of threats to release company information.
• 8:19
  And, you know, that's sort of been the typical pattern that we see some of these cybercriminal groups engaging in financially motivated cyber attacks.
• 8:28
  But that doesn't seem to be the case here because the damage was already done.
• 8:33
  There's not sort of a risk of, you know, it doesn't seem to be a risk of, you know, personal information, customer information coming out of this.
• 8:41
  So it's.
• 8:42
  At this point, I would generally rule out that type of incident.
• 8:45
  The second category would be nation state cyber attacks.
• 8:50
  You know, generally that's been rare with respect to the retail sector just given, you know, compared to other sectors that, like the electric sector, some of the defense or national security related sort of potential cyber targets.
• 9:04
  But we are sort of in a unique geopolitical environment where we have seen attacks against water systems in the United States in the last few months, attacks against other types of infrastructure that has been less commonly sort of
• 9:17
  attacked.
• 9:17
  So I don't think we can rule that out at this point.
• 9:20
  But, you know, again, it's hard to know the probability of that.
• 9:23
  And then the third category would be just somebody doing this because they could.
• 9:30
  The fact that you had this known vulnerability that was reported and has been out there for over a year in terms of the patch, the fact that now some of these AI tools enable people who don't have strong
• 9:43
  technical expertise to help them carry out attacks, help them identify potential targets, even with some of the guardrails that the newer AI models are putting on to prevent them to be used for cyber attacks.
• 9:56
  There are ways that, you know, clearly, as a number of the AI companies reported an increase in sort of using AI to carry out attacks.
• 10:03
  And even without AI, some of these are things that, you know, could be done by, you know, just to, you know, just to do them for, you know, for just to sort of prove you can do it or
• 10:13
  just given some of the hacker culture where you see things done for no real apparent purpose except just to try to be disruptive to society.
• 10:24
  Gosh.
• 10:24
  Okay, so I guess, Christian, probably the key thing there for, you know, for our audience, for the list, the retailers who are listening, you know, those who are, who are unaffected, I guess the question for them right now
• 10:35
  will be, you know, what should I be doing to protect myself?
• 10:38
  Is the things I should be doing that I haven't been doing, am I following best practice?
• 10:43
  And especially at a time when we've been talking about grocery stores becoming increasingly digitized and increasingly connected, I guess we've got more points of vulnerability.
• 10:52
  So, Christian, what are your expert recommendations for practical actions grocers should be taking in the short and medium term?
• 11:01
  A few things come to mind here.
• 11:03
  And first of all, don't wait to patch where there are sort of known vulnerabilities against systems that you have, both your IT systems and your operational technology systems.
• 11:15
  Given the fact that we're now seeing a real acceleration of the discovery vulnerabilities with some of these new AI tools and the ability to then exploit them more rapidly after they've been identified.
• 11:27
  Companies need to really accelerate their efforts to patch everything.
• 11:32
  And it's not just your core IT systems again, it's your refrigeration systems.
• 11:38
  Everything in your store that's connected to the Internet is a potential vulnerability.
• 11:43
  And we've seen that repeatedly now over multiple decades.
• 11:48
  The second thing to think through is, and I kind of alluded to this a second ago, but there's a lot of, as you look at sort of the store and all the operational technology that's in a store, a
• 12:02
  lot of it's connected to the Internet, obviously your point of sale systems and some of your things where it makes sense to be.
• 12:10
  But I think there's an open question, does everything within your store need to be connected to the Internet?
• 12:15
  Are there some things where just, you know, the convenience of having that sort of remote management and Internet connectivity, the security risks may outweigh the benefits of that connectivity.
• 12:27
  So I think it's worthwhile for you know, companies to, you know, do that inventory of within our typical store footprint, you know, what's connected, what needs to be and are there ways that we can, you know, better secure
• 12:40
  things, you know, or isolate them from with the broader corporate network or in some cases where there have been patches that need to be carried out.
• 12:50
  Make sure you're doing those.
• 12:51
  And the final thing to note here is just sort of broader refocus around third party risk management, vendor risk management.
• 12:59
  There was a report last year by one of the companies that works on this issue that basically found the retail sector of any industry sector it was looking at had the highest percentage of its cyber incidents that were
• 13:10
  attributable to to third party incidents versus incidents directly against your first party IT and systems.
• 13:19
  And I think we've seen that repeatedly in some of the cyber ins over the past couple years.
• 13:26
  There were some high profile cyber instances in the UK last year that were reportedly due to an IT third party that they were all using.
• 13:34
  The company Blue Yonder had a well known to many retailers, had a major cyber incident in 2024 that affected many retailers.
• 13:45
  So, you know, and I could go on with sort of other examples here.
• 13:48
  But so, you know, it really comes down to, you know, as you're sort of building relations with vendors, building relations with your third parties, improving your assessment of what they are doing to their own cyber defenses, you know,
• 14:00
  what they are doing to, you know, Protect, you know, protect your company, you know, protect your, you know, as you're sort of getting closer and embedding with them and making that part of the acquisition procurement process, making that
• 14:12
  an ongoing effort to valid, you know, what, what they're doing.
• 14:16
  And so, you know, I think that's, it's a bit of a shift for some companies, but I think that's the real, the key takeaway here is just that importance of that sort of third party risk management, vendor risk
• 14:26
  management as one of your top cyber priorities as a company.
• 14:31
  Understood.
• 14:31
  And, and just.
• 14:32
  Yeah.
• 14:32
  One final point before you go, Christian.
• 14:34
  I was reading some reporting this morning that Reuters were leading that it felt that their insurance policies, even specific cyber insurance policies, might not cover the damage that's being impacted to the physical stores and the block in some
• 14:48
  of these French stores.
• 14:49
  Would that meet with your interpretation?
• 14:51
  What would be your understanding from an insurance perspective?
• 14:54
  If you look at cyber insurance coverage, it typically, you know, covers sort of direct damages related to, you know, the cost that companies bear to, you know, carry out the incident response, you know, respond to, you know, different
• 15:10
  sort of, you know, legal inquiries and things that, that they may face.
• 15:14
  But very rarely have we seen cyber insurance cover secondary physical impacts to companies where, you know, I mean, where we've had, you know, other incidents over the past, you know, year, you know, Jaguar Land Rover had a major
• 15:28
  incident earlier this year where they had to shut down, you know, auto assembly lines.
• 15:32
  You know, I think there were questions there about, you know, would that be, you know, covered by cyber insurance.
• 15:37
  And you know, the same thing with this case where, you know, you have physical loss, that doesn't really directly translate to cyber insurance.
• 15:43
  So it's a question definitely retailers and other companies should be asking their insurers.
• 15:47
  But these are also issues that are very hard for insurers to quantify and be able to provide insurance coverage for.
• 15:57
  So it's an issue to definitely be engaged on, but there's no sort of easy answer to that and there's no easy out for insurance to cover this as, you know, as a, as a loss for, for companies.
• 16:09
  Christian, thank you so much for joining us at short notice.
• 16:13
  Super interesting.
• 16:14
  Hopefully it's been really valuable for everybody listening.
• 16:17
  Look, before I let you go, if our listeners want to contact you to discuss this further and talk about your services, how can they get in touch.
• 16:24
  A couple different ways?
• 16:26
  You know, my consulting firm website is commerce.com so feel free to reach out to me there or very accessible on LinkedIn.
• 16:34
  Just Christian Beckner, you should be able to find me there.
• 16:36
  Christian.
• 16:36
  I hope next time we talk it's on the happiest circumstances.
• 16:39
  But thank you for joining us again.
• 16:40
  Yeah, thank you, Ben.
• 16:42
  Grocertalk is brought to you by Instacart Enterprise, which gives grocery businesses the technology to grow online and in store with one modular platform built for how grocery actually works and built to scale with you.
• 16:57
  Learn more at company.instacart.com forward/grocer talk.
• 17:03
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• 17:05
  Sifter Solutions Powerful API seamlessly integrate advanced medically tailored dietary and nutritional filtering into virtually any grocery or wellness platform.
• 17:17
  Sifter makes healthy outcomes possible.
• 17:20
  Learn more@siftasolutions.com and now for a very welcome change of topics and a chance for me to introduce our second guest of the show.
• 17:32
  Susie.
• 17:33
  David Canyon is vice president, Content in the retail and e commerce practice at eMarketer.
• 17:40
  Analyst, speaker, storyteller, podcast host, and former retail VP.
• 17:46
  A very warm welcome to GrosserTalks easy.
• 17:49
  Thanks so much for having me, Ben.
• 17:50
  I'm so excited to be here.
• 17:52
  Oh, I'm so pleased.
• 17:53
  I'm sure lots of our listeners will know you already and will know E Marketer, but for those who are meeting you for the first time, give us the full introduction, please.
• 18:02
  Susie Sure.
• 18:03
  I mean, you covered a lot of it.
• 18:04
  So I'm a VP of Content at eMarketer.
• 18:07
  I focus on retail and specifically how consumers shop, how retailers should be thinking about that.
• 18:13
  Under our remit, we also have commerce media.
• 18:16
  So everything that has to do with that intersection of advertising and retail, as you said, I host our Reimagining Retail podcast, which is every Wednesday day, where we explore the future of shopping.
• 18:28
  I worked at a very large American department store for a very long time.
• 18:32
  I also worked in stores.
• 18:33
  So I really come at it from every angle.
• 18:35
  And at eMarketer, which is a market research firm, I really work closely with the analysts on their research on the forecast and really thinking about what's changing and what our, you know, consumers, our readers, can, can do about
• 18:49
  it to strengthen their business.
• 18:52
  Amazing.
• 18:53
  Amazing.
• 18:53
  Okay, let me, let me give a little bit of background, a little bit of context to the conversation.
• 18:58
  I'd love to have.
• 18:58
  Susie I think it really started a grocery shop.
• 19:01
  Last month I, I had the opportunity to interview Jeremy Gosh, who's CEO of HyVee.
• 19:09
  And, and during the interview he said that for shoppers trying to complete a full online shop with Hyvee, it currently takes them on average, full 40 minutes to complete the shop and he shared that it's their aim to
• 19:24
  reduce that to five minutes.
• 19:26
  So that was a lot.
• 19:28
  It was during a section of the interview where we were discussing shoppers need for speed when I asked okay, wow, how Jeremy?
• 19:35
  His answer was of course agentic AI.
• 19:39
  So basically automating large sections of the shop and helping to prevent populate baskets.
• 19:47
  Now the time that I had on stage exploring this element and look, it's something that we've discussed on prior grocer Talk episodes was all about the kind of consumer facing the shopper, facing agentic AI and how it might
• 20:00
  change that experience.
• 20:02
  But in doing so I think we've failed to address what is should be a big industry talking point and that is that if E commerce becomes increasingly automated, well, what does that mean for retail media?
• 20:17
  What does it mean for grocers, retail media businesses and the associated profit contribution in this sort of agentic world?
• 20:24
  So Suzy, this is our chance to rectify this.
• 20:27
  I know it's an area where E marketer spends a lot of time and obviously you've got all your practices latest thinking on this area to share.
• 20:36
  So look, help me understand what do AI assistants mean for retail media businesses.
• 20:45
  So I love talking about this and I would even challenge us to think about it one step higher.
• 20:50
  First in terms of like the premise that we're going to use AI assistants and agents to do our shop is I think a really big one to start with and that there's shopping that is chore so replenishment where
• 21:04
  we could, I could see that that's going to happen more and more as the technology becomes more seamless and as consumers start to understand the value that they're getting from that process.
• 21:14
  And by value I don't mean that they're going to start getting things for less expensive but just as you said, you know, it's going to save time, get the brands you love at the prices you're willing to pay,
• 21:23
  help me save time so I can do something different.
• 21:27
  But that doesn't sort of the idea around shopping in serendipity and enjoying shopping even in grocery I think still exists.
• 21:35
  So this is where when we think about retail media dovetailing into this idea, there will always be moments where the consumer is not going to hand off the entire shop and is going to be want part.
• 21:47
  Want to be part of that to like see new brands.
• 21:51
  You know, just think about when you go in store and you're walking the aisles and you're like oh, I always buy this item and it's on sale.
• 21:57
  So I'm going to buy two because it's on sale and it wasn't on my list but I'm going to do it anyway.
• 22:01
  So I do really think that there is, you know, we have to start thinking about it from Will everything be automated?
• 22:07
  My, my guess is no.
• 22:09
  And so how do think about that from a retail media perspective in terms of the things that are automated and where a brand can show up from an advertising perspective and then also the things that we're doing for
• 22:20
  fun and in that case, where does a brand show up and how do they show up to sort of infuse the unexpected surprise and delight moments?
• 22:28
  I just want to check this with you so your so e marketers view is okay, there's going to be an impact and let's go on but let's put it into context.
• 22:38
  Let's firstly recognize that agent E commerce is going to be, and I paraphrase, but correct me if I'm wrong, a relatively small piece of grocery.
• 22:47
  So therefore keep it all in context.
• 22:49
  Is that what I'm hearing?
• 22:50
  So today it's going to be very small.
• 22:52
  I mean even just online shopping today is very small.
• 22:55
  Right.
• 22:55
  And so if you think about assistant, it'll be more about the consumer sort of editing the basket versus going and looking and adding everything to cart or like Amazon in the US is doing some interesting things as are
• 23:07
  other retailers where you can see your previous orders and it's very easy and you just click and it goes through or like subscribe and save, which is often for grocery products where you have a sort of cadence, you're
• 23:18
  saving money.
• 23:19
  Amazon knows exactly what it's doing, it's sending it to you.
• 23:21
  So there are lots of different ways where people are interacting with online grocery shopping.
• 23:27
  Assisted shopping, like an agent will be one of those ways.
• 23:31
  But it is definitely very small and it's going to right now at least and it's going to move money from one sort of digital channel to another.
• 23:39
  It's not going to take away from stores.
• 23:42
  And I just want to say yes, at eMarketer we do lots and lots of research on this.
• 23:46
  Sarah specifically works through the retail media component and thinking about broader retail sort of trends and how that would impact retail media and commerce media in general businesses.
• 23:58
  We have a forecast team, we have an analyst who covers AI.
• 24:01
  I think it's all still so nascent that some of us will have different opinions.
• 24:06
  But coming from the retail world, you know, I was a merchant in pricing, I worked in A store at Tiffany's actually so.
• 24:13
  And now working on the consumer insight side, I do think we all have different perspectives mind today is that until even just think about muse, right.
• 24:21
  Like the, the assistant, the holy Grail assistant Meta's muse that's going to be able to do everything you need for it to do.
• 24:27
  I think there are lots of other hurdles we need to jump through like trust, you know, like right now when you do online shopping and there's a packer and picker, there's still a human in the loop.
• 24:36
  If they don't have the milk brand that you normally buy or the 2% or whole milk or whatever it is, there's still someone technically texting you and saying they don't have that, they're stocked out.
• 24:45
  Do you want this instead or nothing.
• 24:46
  Right.
• 24:47
  So I think grocery can be very specific and there's still, there's still a lot of room for error.
• 24:54
  And so while I am excited about this idea, I was just thinking about smart fridges, right.
• 24:58
  Like there are more and more technologies around.
• 25:02
  Instacart and Samsung have a deal.
• 25:04
  There is more and more sort of like make my life easier happening.
• 25:08
  But that distinction of like is this the way we're going to be tomorrow?
• 25:12
  I think it's, it's probably important to say it's the beginnings of and it's the experimental phase.
• 25:17
  Yeah.
• 25:17
  And I think that's great context.
• 25:18
  But so if we, if we pick up this idea of a, an accelerated and an increased amount of automation, this idea of an element of basket pre population, if you working in retail media, if you're thinking about okay
• 25:35
  this is nascent but all the forecasts suggest this is going to grow.
• 25:40
  How do you think retail media companies should be thinking about it?
• 25:43
  Let's not forget the whole concept of retail media grew up on kind of sponsored search returns.
• 25:47
  So if people aren't searching, how are you guys thinking about this?
• 25:53
  So I think it's critical.
• 25:54
  I'm sorry, I'm just constantly telling you about all the different sort of like tension points that we're thinking about because I think here too, I mean you sort of alluded to it, but we are making the distinction between
• 26:04
  shopping on an LLM third party chatgpt where retail media ad dollars will show up if you.
• 26:10
  And they're already starting to show up right off site and then on site like on the retailers sort of.
• 26:16
  Kroger just launched an assistant that has some ads in it.
• 26:19
  So like we are definitely making those distinctions and I think retailers need to think about that as on site, off site in the same way that they would otherwise in terms of better understanding how they reach their customer.
• 26:30
  At the end of the day, retail has had so many different evolutions and so many different sort of channels to be thinking about to find the customer where they are.
• 26:40
  AI is one more.
• 26:42
  For me, the biggest distinction here is that there are going to be bots.
• 26:46
  So it's not, you're not just sort of as an advertiser, you are no longer just worried about a human interacting with your ad and being excited about your ad and then clicking that to cart.
• 26:55
  But you also have to have the right information for if one day you know, the weekly shop is done through a bot without a human in the loop, that they are also sort of influenced potentially by the ad.
• 27:08
  See, that's really interesting.
• 27:09
  Have you got anything in the research that you do at eMarketer that kind of illustrates just how disruptive AI commerce could be for retail media networks?
• 27:18
  Yeah, absolutely.
• 27:19
  I think even like to level set.
• 27:21
  In the latest e marketer Bain research we found that about half of the retail media leaders that were surveyed cite agentic AI disrupting their media buying and almost half cite that AI platforms will come between retailers and shoppers.
• 27:35
  And how do you think or how do you foresee kind of bot influencing taking shape?
• 27:41
  So I think, I mean that's the million dollar question, right?
• 27:43
  So we're nowhere near there yet.
• 27:45
  I think today it's probably more about experimenting with the Rufus of the world and the sparkies of the world to make sure that you know, when you were showing up on site but through the search function or on
• 27:56
  the main website that you think about what that could look like on the bot, on the conversation, there's going to be so much more information that you're going to have because in theory it's going to be more like,
• 28:06
  like I'm planning a birthday party and I need to, you know, that's the classic example and I need to make dinner for 10 people.
• 28:12
  Help me understand what I should be thinking about.
• 28:14
  This is a theme I have.
• 28:17
  The bot is collecting so much more rich information about what you want.
• 28:21
  And that's where with AI on the back end everything gets contextualized and moves so much more quickly that the bot can service ads for products that are adjacent or similar to that are maybe not in the realm of
• 28:34
  products that you were originally going to buy or brands that you're always buying and introduce you to new things.
• 28:41
  Just like there could be an echo chamber.
• 28:43
  So I think this is the Tricky part right there could also be the echo chamber that it only surfaces things that you are that they already know that you love.
• 28:50
  So I think at the end of the day, like every other decision any sort of business person makes, they have to take a step back and decide am I doing customer retention, am I doing new customer acquisition?
• 29:02
  And then the retail media world, like many other things, is, is one component of that strategy of how to get there.
• 29:10
  So I guess if we're talking about kind of practical things that retail media networks should be doing today as this grows, I, I think what I've heard from you so far is three things.
• 29:18
  One, one is on site, I.
• 29:21
  E.
• 29:21
  Making sure the opportunities for paid and ads and influencing lives within the assistance.
• 29:28
  Second is off site.
• 29:29
  Understand the off site opportunities as understand how your offsite traffic is changing and prioritize accordingly.
• 29:35
  And second is information.
• 29:38
  Get that product level data into the system to be able to respond to queries.
• 29:42
  Is there anything else or have I correct me if I'm wrong if I've misheard you anywhere there, Susie.
• 29:47
  No, those are.
• 29:48
  That's a great summary.
• 29:49
  And I think one of the things Sarah found in her research with Bain was that 77% of the retail media leaders that were surveyed, they're already thinking about agentic advertising formats.
• 30:00
  So I think it's really good critical to be thinking about the impact that AI is going to have on the customer journey and making sure you know that you, that you as an advertiser and as a retailer find
• 30:13
  your consumer where they are and that we think about it in two ways.
• 30:16
  There's the underpinnings of all of the rich information that AI contextualizes really quickly and that now, you know, you might be able to remove some friction like not having ads for things that are out of stock stock.
• 30:28
  But you also have to think about the different sort of formulas of the way the ad shows up and it's not different from what we were doing before with the displays versus the product search links.
• 30:39
  You know, it's just a new iteration and I think retail media networks are up for the challenge.
• 30:46
  You know, they've been thinking about how do you monetize the amount of in for the rich information that you have to help connect advertisers with shoppers.
• 30:55
  Susie, you know, part of, part of one of the things I thought was really interesting going back to kind of Jeremy Gosh's comments, you know, the narrative has been about grocery delivery is all about convenience.
• 31:11
  But what he spoke to is a kind of an almost an inconvenient truth that you know, building a full basket online remains time consuming and that element, it's a chore and that's often overlooked.
• 31:24
  So I thought it was kind of welcomely refreshing to hear a CEO on stage talking about that saying it takes 40 minutes to complete a main shop.
• 31:33
  But I know you've got an extensive e commerce research program, E marketer time to complete the shop.
• 31:41
  Does that come up in your research as a barrier for why people do or don't use E commerce?
• 31:47
  Do we think we're trying to solve a problem that perhaps isn't there?
• 31:52
  I mean it's such an interesting question.
• 31:54
  I, I don't have research around how long it takes to build a basket.
• 31:58
  I think there's so many different parts of that, right?
• 32:00
  How many people are in the household, how often do you shop, how often do you travel, eat out?
• 32:05
  I mean there's just like so many different layers of it.
• 32:07
  One thing is clear that shopping online, especially for lots of little things that you're putting and building a bigger basket and is tedious.
• 32:15
  Right?
• 32:16
  Every website is a little bit different.
• 32:18
  You know, the search functions aren't always great.
• 32:20
  The filtering function doesn't always work.
• 32:22
  I think retailers are getting ahead of that by doing like repeat purchase buttons and like helping you identify the things that you buy all the time.
• 32:30
  Personalized ads sort of fall into that as well in terms of helping you figure out what it is that you need before you even think you need it.
• 32:38
  I, I'm part of the merchant generation that worked through.
• 32:41
  Now you're going to know where I worked before at Macy's.
• 32:44
  I was there when they made a deal with Dunhumb.
• 32:46
  We were trying to figure out how can you use data at the department store to help inform the right sort of advertising catalogs information that you send and how do you personalize that.
• 32:58
  And what is clear is that in grocery it's such a habitual and repeat purchases and once people like something they typically rebuy it.
• 33:07
  So I think there is a lot of room for an agent to take away that sort of menial task labor that is friction filled depending on the, on the website and turn that into something a little bit more
• 33:18
  automated.
• 33:19
  I still think it's going to be human in the loop in that you're still going to need to be the editor to say oh you know what, actually my kid's coming home from college so I need more of
• 33:27
  this than I did the last three weeks.
• 33:29
  So I do, I do think it's here to help us be better be more efficient.
• 33:34
  But I don't think we're 100% at that trust level where we're going to just let it be on auto autopilot.
• 33:40
  I don't know if that answered your question.
• 33:43
  Yeah, I think one of the things that Jeremy went on to talk about was throughout their thinking and hybe going to replatform all of their systems to enable this to happen.
• 33:52
  They said they were recoding all of their websites.
• 33:55
  That's going to be fascinating to watch.
• 33:57
  But he made it really clear that part of that is to still enable time for discovery, time for promotions and also times for seasonal so just pre populating based on previous purchases does not take into account season seasonal
• 34:12
  trends, events which is so important.
• 34:15
  And and just as a sidebar for listeners, if you want to hear more from Jeremy.
• 34:21
  Gosh, he came after our on stage conversation he came straight to the OmegaTalk podcast.
• 34:26
  Beaver Grocery Shop did an interview.
• 34:28
  It's on the Grocer Talk feed.
• 34:30
  I will look.
• 34:31
  We'll, we'll put the link in in the show notes so anyone can, can go and listen to it.
• 34:35
  You know, right now it's so expensive to acquire new customers.
• 34:39
  It's like how do you get them to keep coming back and buying more?
• 34:42
  And so this idea that if you' just comping your last week's shop without thinking about more different new flavor seasonal goods then you're going to lose, you know, at the end of the day.
• 34:53
  And so it's really interesting to think about how they're building that process to try and ensure that there's a little bit of serendipity in the automated process.
• 35:03
  Completely agree.
• 35:04
  Completely.
• 35:04
  And CZ look thank you for coming and joining today.
• 35:07
  If people want to get in touch with you are following this or any time in the future, what's the best way for them to get in touch?
• 35:15
  I think probably LinkedIn is the easiest but you can also email me.
• 35:19
  I'm happy to s.
• 35:20
  David canyon marketer.com But LinkedIn is probably the easiest.
• 35:25
  Fantastic.
• 35:26
  And you know what, just before we leave, a bit of a conversation about retail media.
• 35:30
  I do want to flag for European UK based listeners next month.
• 35:37
  So on Tuesday 3rd November I'm running an invite only closed door dinner for CPGS with the managing director of Nectar360 so one of the UK's biggest retail media networks, Amir Rushkerf.
• 35:51
  So if any of our listeners are interested in joining on that, there's a couple of seats still available, please just message me and on that note.
• 35:58
  Susie, thank you so much for joining us today.
• 36:01
  Thanks so much for having me.
• 36:03
  Grocer Talk is brought to you by proud sponsor Fusion, the global leader in connected retail solutions, helping grocers improve productivity, execution and customer experience from shelf to checkout.
• 36:18
  So visit vuzion.com and by portager, a groundbreaking purpose built AI platform for retail negotiations and joint business planning, helping merchants prepare smarter, negotiate stronger and maximize value.
• 36:35
  Visit Portager AI to learn more.
• 36:40
  Before we wrap today, there is one last new story of the week to cover.
• 36:45
  The pressures on supermarket format stores in the US Are undeniable and it's already been a reoccurring theme of the show.
• 36:54
  Well, in the last week we got the latest illustration of the impact of these pressures.
• 37:01
  Albertsons published his second quarter earnings which reported revenues down 0.1%, comps down 0.8%, adjusted net income down 28% and margin net margin now running below 1%.
• 37:19
  Now these numbers really shouldn't come as a surprise to anyone who's been following Albertson's performance of late and to be fair, were in line with company expectations.
• 37:29
  But CEO Susan Morris went on to say that this performance does not, quote, reflect the potential of the company.
• 37:37
  She announced a comprehensive business review to improve performance and tackle a cost structure the Albisons quoting again can no longer afford.
• 37:49
  And this review really will be comprehensive.
• 37:52
  Everything is on the table.
• 37:54
  The Q2 statement spells this out in a line that reads, the company is reviewing its company strategy, cost structure, operating model, portfolio of banners, market assets and businesses and capital allocation priorities.
• 38:14
  And that folks, is the whole shooting match.
• 38:17
  And as a result of this, Albertsons withdrew its financial guidance for the full year with no updates on that promised until next spring.
• 38:27
  Okay, let's be frank here.
• 38:29
  This is Albertsons pulling the nuclear option, signposting that the future Albertsons will be a very different company to the one we know today.
• 38:39
  And I don't make light of this.
• 38:40
  I appreciate how unsettling this news will be to the more than a quarter of a million Albertson's colleagues across the US and coming as it does at the same week that Albertson's estranged partner Kroger announced that it will
• 38:54
  cut 3,000 head office roles over the next three years.
• 38:59
  But it's impossible to argue this review isn't needed.
• 39:03
  It's essential and action is needed fast.
• 39:08
  My personal hope is that it doesn't take until next spring for Albertsons to realise that they must move on price on the results call.
• 39:18
  Morris went on to talk about surgical and strategic price and promotion investment by market and category, rather than, say, widespread reductions.
• 39:29
  And that, I fear, just won't be enough.
• 39:34
  Today's podcast was produced with the help and support of LShield and is brought to you exclusively as part of the Omnitalk Podcast Network.
• 39:44
  Omnitalk exists to highlight the trends, technologies and innovations shaping retail and Grocertalk now does this specifically for the global grocery and CPG industry.
• 39:55
  Thanks as always for listening in.
• 39:57
  Please remember to like and leave us a review wherever you happen to listen to your podcasts or on YouTube.
• 40:04
  And you can follow us today by Simply going to YouTube.com omnitokretail so until next week, and on behalf of all of us at Grossertalk and Omnitalk Retail, thanks for tuning in.