You’re Going to Need a Bigger Moat

In Remarkable Retail I made the argument that even very good is unlikely to be good enough to win in a world of abundant choice, 24/7 access, and ever improving delivery speed. Trying to be a little bit of everything to a whole lot of someones was becoming increasingly untenable. The collapse of the unremarkable middle would continue unabated.

In early 2024 I published Leaders Leap, and my case there was more about the increasing pace of disruption. My admonition was that not only did you have to aim ever higher in the customer value you deliver, but you had to move much faster and act more boldly to avoid falling further behind and risk sinking into the zone of irrelevance.

In just the last two years the dramatic rise in all things AI is raising the transformational stakes even higher.

Set the WABAC Machine for 1995

If you’re of a certain age, you’ll remember what shopping for just about everything was like three decades ago. While mail order catalogs were still around—and Amazon had just launched—nearly all shopping required a trip to one or more physical stores.

For most retailers, their moat was largely built around a great location on the high street, main street, or in a strong shopping center. A well curated and nicely presented assortment was important, as well as very good sales people. Even better if you had some degree of exclusive or narrowly distributed product offerings. During my career at Sears in the nineties, Kenmore, Craftsman, and DieHard were keys to our success.

By the time I joined the Neiman Marcus Group in 2004 as senior vice president of strategy, new business, and multichannel marketing, our moat had gotten more sophisticated but the logic was largely the same. We had amazing real estate, beautiful store environments, unique assortments, strong relationships with our vendor partners, and deep ranks of experienced merchants, store managers, sales associates, and personal shoppers, all of which led to EBITDA margins in the mid-teens with solid top line growth. We’d responded as well to technology shifts and evolving customer needs, with a rapidly growing e-commerce business and new “omni-channel” efforts.

As you might have heard, a few things changed for the worse for both of my former employers in the ensuing years. But they were hardly alone in failing to maintain a meaningful moat.

Everyone to Their Corners

Much of what’s changed in retail over the last two decades comes down to what I’ve long referred to as “retail’s great bifurcation.” At one end of the spectrum, hyper-scale retailers have relentlessly optimized on price, variety, and convenience—think Amazon, Walmart, Costco. At the other, specialty brands have narrowed or sharpened their customer focus and “amplified the wow” in more emotionally connecting ways, either delivering a strong sense of meaning (Patagonia, Hermès), belonging (Vuori, Tecovas, Aesop), or a fun and immersive experience (Dick’s House of Sport, Netflix House, RH Gallery).

Both ends know precisely who they are for and what they stand for.

The retailers stuck in between—decent selection, decent prices, decent service, nothing you’d drive past three other stores for or simply stay at home and order online—keep losing their reason to exist.

The middle has become a no man’s land.

Well Isn’t It Agentic?

And now comes the rapid growth and adoption of agentic commerce.

Here's part of what's different in the emerging world of answer agents.

A mediocre retailer has always been vulnerable, but human shoppers come with built-in inefficiencies like inertia, habitual loyalty, and simply running out of time or energy to find a perfect match.

Agents don’t get tired, and they work really fast. They don’t have a store or brand they default to because it’s always been there or because marketers bought the keywords to show up first on Google.

Many buyinig occasions become the exhaustive comparison shopping you used to have to be motivated enough to do yourself. And in this brave new world it turns out that “pretty good” rarely wins against a field of everyone else who’s also pretty good.

It also turns out that the more you serve relatively commoditized purchase occasions and customers who value the most efficient way to get something off their to do list, the more you are likely to be engaged in a race to the bottom.

While things are changing quickly and I lack a working crystal ball, I’d be willing to bet that a handful of large, massively resourced, relentless optimizers will win that particular race.

So what do you do if you're not one of the giants?

Interchangeable or Irreplaceable?

For the rest of us our moat will likely be built around an “edit to amplify” strategy, that is, narrowing our customer focus and sharpening the value we deliver on a limited set of purchase criteria that are highly customer relevant, well differentiated, well aligned to our capabilities, and where we can build and maintain an “ownable” position.

You might be saying to yourself, well Steve that is hardly a new strategic concept. It’s always been important to have a compelling value proposition. And you’d be right.

But the retailing world grows ever more crowded, technological change disseminates faster, choices are becoming nearly infinite, and friction keeps dissolving.

If we can’t create a powerful signal we’ll get lost amid all the noise that the agents will be fine tuned to navigate.

And yet the market for the truly remarkable is rarely crowded.

Being irrelevant increasingly amounts to being invisible.

You can work towards being irreplaceable or end up being interchangeable.

WHERE IN THE WORLD IS STEVE?

I'm returning to this year's UTD RISE Conference to do the opening keynote, debuting new material.

It’s going to be an insight-packed day on what’s new and next in retail. Limited seats are still available, so be sure to register here.

MORE REMARKABLE RETAIL STORE TOURS!

This summer we return with a series of short and fun video store tours featuring some of the world’s most remarkable retailers. We recently visited the Buck Mason flagship in Soho to see how they are bringing the brand to life.

Check out more store tour videos here.

ON THE POD

Episode 308 of the Remarkable Retail Podcast features Ulta’s Chief Retail Officer Amiee Bayer-Thomas recorded live in our pop-up podcast studio at the CommerceNext Growth Show.

Listen here, watch here, and follow us wherever you enjoy your podcasts.

What’s So Funny ‘Bout Peace, Love, and Customer-Centricity?

Doing this retail analyst, keynote speaker, podcast host, consulting thing causes me to spend quite a lot of time trying to make sense of retailers’ strategies.

Accordingly, I attend a lot of conferences and spend more time than is probably healthy paying attention to investor presentations, reading through corporate news releases, and scouring various retail newsletters.

The number of times I have heard a CEO share that their new growth plan includes some version of being “customer-first” or embracing “customer-centricity” or, even better, becoming “customer-obsessed,” would fill all the holes in Albert Hall (note to Zoomers: trust me, this is a clever reference).

You Keep Using That Word . . .

Soon to retire Best Buy CEO Corie Barry has often spoken about being “manically focused on the customer.”

Newish Kohl’s CEO Michael Bender headlines their turnaround strategy as being “customer-led.” He also stated “we stopped listening to our best customers for a while. Today, we start earning them back.”

JC Penney’s chief customer officer says the long-struggling retailer "hasn't really taken our customer seriously enough.”

Macy’s press release announcing its “bold new chapter” says the strategy will “put the customer first…” C'est très audacieux!

This all begs the obvious question: so just what is it exactly you’ve been doing all along?

Lost in Translation

Precisely nobody needs to be persuaded that it’s a good idea to start with the customer. Nobody needs persuading that quality matters, or that employees matter, or that safety matters either.

Those are values, not strategies.

To be a strategy choices need to be made. Some things get more resources, others get cut or eliminated.

In their book The Knowing-Doing Gap Jeffrey Pfeffer and Robert Sutton point out that companies don’t fail because they don’t know what to do, they fail because they know what to do but just don’t do it. They chalk this up to:

• Talk replaces action.

• Copying replaces thinking.

• Fear blocks execution.

• Metrics reward the wrong thing.

• Internal competition kills cooperation.

But I think it’s all this and more. There is also a deciding-not-to gap and this is a design flaw not simply a failure of execution.

Far too many retailers see customer-centricity as customer satisfaction. They default to efficiency measures when the going gets tough. They lack a level of customer insight that can inform their strategic choices. They do the easy thing because it’s cheap and scalable.

And on and on.

If You Aren’t the Customer You’re the Product

It’s also pretty hard to be customer-centric if you’re not sure who the customer is exactly or you have many masters to serve.

Early in Amazon’s history Jeff Bezos famously left an empty chair to represent the customer who wasn’t in any of the company’s meetings.

It turns out that the reality of Amazon’s retail business now often requires four chairs to represent the major constituencies they have to balance:

• The Shopper — the one the empty chair was originally built for who wants the best product at the best price, fast.

• The Seller — the third-party vendor paying commission and fighting for Buy Box visibility. Wants to win the sales but doesn’t necessarily wants the shopper to see the best option.

• The Advertiser — increasingly the same person as #2, now paying twice: once to sell, once to be seen. Wants search real estate, which by definition risks displacing the organic best results for the shopper. Minimally it’s made Amazon’s home page more than a bit of a mess.

• Amazon itself — the platform’s own private-label and retail arm, watching what #2 and #3 sell and reverse-engineering competition against them (allegedly).

Beyond Amazon, any retailer operating a retail media business is confronted with at least two potentially conflicting customers to serve, with advertising often being far more profitable than selling the core merchandise.

Google is the classic example of this. The hero product looks like a search engine, with the purpose of providing the consumer highly useful information powered by incredible intelligence, all for free.

But the “real” product is a data monetization machine on behalf of advertisers, who turn out to be the more important customers.

I Robot

Even with clarity about who we aim to serve, true customer-centricity is a moving target.

After forty years of saying one thing and building another, the next move may involve handing the customer relationship to algorithms and agents.

I’m no Luddite. Many emerging technologies hold the promise of delivering great customer value, and doing so more cheaply and remarkably fast.

That’s incredibly exciting, but it’s also a potential trap.

If we have a less than compelling definition and design of customer-centricity we will merely be automating bad practices or accelerating the rate at which our shortcomings are amplified.

So it’s not about blindly worshiping agentic commerce or deploying robots because they’re new and cool. It’s about deciding with clarity and intention.

Nothing, Actually

Of course we should be customer-centric.

Like peace, love, and understanding, it polls at 100% and always has. There’s nothing funny about that as a value.

What’s funny, or would be, if it weren’t costing people their jobs and their nearest store is mistaking the value for the strategy.

Here’s a test that costs nothing to run and most companies would fail. The next time the customer’s interest and the CFO’s interest collide, how does the decision get made and does the answer tilt toward the customer or to making the quarterly numbers.

If you don’t know the answer, you’re not customer-led, you’re just reciting the press release.

And the customer, who was never fooled, already knows the difference.

REMARKABLE RETAIL STORE TOURS ARE BACK!

This summer we return with a series of short and fun video store tours featuring some of the world’s most remarkable retailers.

We recently visited the Tecovas flagship in Soho to see how they are bringing the brand to life.

Check out more store tour videos here.

ON THE POD

Episode 307 features Bombas CEO Jason LaRose recorded live in our remote podcast studio at the CommerceNext Growth Show.

Listen here, watch here, and follow us wherever you enjoy your podcasts.

Convenience is Boring

Retail has never worked harder to be effortless.

Conference keynotes and breathless tech company pitch decks are chock-a-block with “seamless” this and “frictionless” that.

Returns are fast and free.

Home delivery in two days. No, next day. How does this afternoon sound? Or in thirty minutes or less?

Maybe we skip the line or grab-and-go?

Before long one-click ordering may give way to zero clicks.

The industry has settled on a simple creed: easy is better, easiest is best.

At one level, this is progress. At another, we risk chasing our tails.

What was once remarkable becomes table stakes, and what becomes table stakes becomes forgettable.

The Tyranny of Convenience

But the treadmill is only half the problem.

The deeper issue isn’t that convenience stops being remarkable. It’s what convenience takes from us while we’re busy applauding it.

Tim Wu saw this coming. In his 2018 essay “The Tyranny of Convenience,” he argues that convenience has become the most underestimated force shaping our lives — not because it fails, but because it succeeds so completely that we stop asking what it costs.

Convenience promises liberation but ultimately delivers a strange conformity. When everything is easy, ease itself becomes the only value, and the effortful things that actually constitute meaning — the browse, the discovery, the encounter with an actual person — get engineered away as bugs rather than features.

Convenience can become retail’s white whale: an all-consuming obsession, a relentless pursuit of elimination and subtraction. And once our customers acquire the taste for fast and easy, anything else can seem irrational.

Almost nobody has a fashion emergency. But if you can get those designer sneakers to me by lunchtime, sure, why not?

Yet consider what actually disappears when friction does.

The wander down the aisle you didn’t plan. The thing you didn’t know you wanted. The salesperson who talks you out of the wrong jacket and into the right one. The twenty minutes in a bookstore that started as an errand and ended as an afternoon.

None of this survives optimization. It can’t. Serendipity is, by definition, inefficient. Discovery requires detours. And a conversation with another human being is the least frictionless experience I can imagine.

Convenience, it turns out, is the great homogenizing force. When everyone optimizes for the same thing, everything ends up the same.

Fast. Easy. Boring.

Nobody Ever Waited in Line for Paper Towels

Here’s the thing about friction: sometimes we line up for it.

Nobody has ever needed to camp outside an Apple Store. The same iPhone arrives, effortlessly, at your door on launch day. People queue anyway, for hours, sometimes overnight, because the line is part of the story.

The croissant-cookie-taco hybrid that’s blowing up on TikTok? The wait is the point. A ninety-minute line doesn’t deter the pilgrimage; it certifies it. Nobody posts a photo of their delivery confirmation.

Supreme built a billion-dollar brand on Thursday morning lines.

The hottest restaurant in any city is, by definition, the hardest table to get.

Three hours in line at Franklin Barbecue ain't just about tasty brisket. The brisket's gone in twenty minutes. The story lasts for years.

Strange behavior for a species that supposedly craves the frictionless.

Unless we’ve misread what customers want.

Convenience is what we demand from the things we don’t care about. The things we love, we’ll wait for.

Friction Is a Diagnostic

Which raises an uncomfortable question for an industry spending billions to shave off every last second of friction: What if the customers you’re optimizing for are the ones who care about you the least?

Friction isn’t the enemy. Friction is a diagnostic.

Show me where customers willingly endure it, and I’ll show you where the joy lives.

Show me where they resent it, and I’ll show you a commodity.

Which means the job was never to eliminate friction. The job is to know the difference.

Strip out the friction nobody values: the checkout maze, the fourteen-field form, the return that requires a printer and a prayer. That’s just hygiene — the price of admission, not a strategy.

But protect, even invest in, the friction that creates the memory: the browse, the conversation, the discovery, the wait that certifies the story. That’s not inefficiency., that’s the product. And it’s the only ground the giants can’t take from you.

Because “easy is better, easiest is best” is a race with no finish line and the lanes are already taken.

Amazon and Walmart have spent decades and many billions building the machinery of easy. You will not out-convenience them. You can only spend yourself into exhaustion trying.

Nobody remembers easy. But even if they did, easy was never yours to win.

Boring, it turns out, isn’t just boring.

Boring is expensive. But that’s a story for next time.

ON THE POD

Episode 306 features Tractor Supply CMO Kimberley Sweet Gardiner recorded live in conversation with me on the CommerceNext Growth Show main stage.

Listen here, watch here, or follow us wherever you enjoy your podcasts.

REMARKABLE RETAIL STORE TOURS ARE BACK!

This summer we return with a series of short and fun video store tours featuring some of the world’s most remarkable retailers. First up: the Nespresso NYC flagship, a true coffee temple and their largest global outpost. Does Dua Lipa or George Clooney stop by? Inquiring minds want to know!

Check out more remarkable retail video shorts here.

Retail’s Great Concentration

The majority of power being held by a minority is neither a new nor rare experience.

Income and wealth are increasingly concentrated. The top 10% of households hold some two-thirds of total household wealth. Equities are even more lopsided: the top 10% of Americans hold over 87% of corporate equities and mutual fund shares, and the top 1% owns nearly half the market outright.

Sticking with the stock market, the Mag 7 — Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta, Tesla — make up about 34% of the S&P 500, up from 12.3% in 2015. The top 10 stocks overall went from 22% of the index in 2020 to just shy of 40% today. Over the past three years, the Mag 7 alone have driven between 42 and 62% of total equity market gains.

In many places it's the short head, rather than the long tail, where power lies. In two domains where I have some experience, about 1% of all podcasts command 99% of downloads, and in the book industry just 4% of books account for 60% of profits.

Closer to where I’m headed with this article, Moody’s pegs the top 10% of earners as driving nearly 50% of all consumer spending.

Retail’s Great Bifurcation

Way back in 2015 I coined the term “retail’s great bifurcation” in an article that updated my “death in the middle” blog post from a couple of years earlier. In it I pointed out that retail results were becoming increasingly and quite dramatically polarized.

Growth in revenues and store openings was strong at either end of the value spectrum. Price- and convenience-oriented players (Walmart, warehouse clubs, off-price retailers, and dollar stores) were gobbling up share. At the same time, above average growth was being realized among premium and luxury specialty retailers. The trouble was in what I later came to call “the unremarkable middle.”

My observations were rooted in data, but in 2018 a Deloitte study (which I contributed to) brought a lot more rigor to the table, reinforcing its findings with an analysis of how profound demographic shifts were fueling the phenomenon.

Even as the largely nonsensical “retail apocalypse” narrative took hold, it was obvious to anyone who cared to look that thousands of stores were opening on the part of retailers that were remarkably efficient, as well as those that delivered far more emotionally connecting experiences. Virtually all the store closings came from those that failed to pick a lane.

Land of the Giants

On an absolute basis US retail is quite concentrated. Since Amazon doesn’t report its Gross Merchandise Value figures, market shares are estimated by various sources. But it looks like the big three (Walmart, Amazon, and Costco) control just over 20% of total retail spend. The National Retail Federation estimates have the top ten retailers accounting for 35-40% of the market.

In e-commerce it’s even more extreme. Just Amazon and Walmart combined capture over 50% of the market. Add in the rest of the top ten and you are likely at over 60% concentration.

Yet it’s what’s going on at the margin that is both fascinating and frightening.

Concentration at the Margin

Credit to Jason “Retail Geek” Goldberg for shining a light on the powerful dynamic we see occurring with incremental spending behaviors.

I first noticed Jason’s analysis in early 2025 when he found that over 60% of all incremental spending was captured by just six retailers: Amazon, Walmart, Costco, Temu, Shein, and TikTok Shops. That meant that the minority share was left to be split among many thousands of retailers, big and small.

This concentration appears to have increased even more since. While figures for the three Chinese-originated platforms are harder to come by, we know that Amazon, Walmart, and Costco’s growth rates have easily exceeded the industry averages in 2025, as well as so far this year.

Again the picture is even more extreme in e-commerce. eMarketer estimates that Amazon and Walmart will account for 51% of all online shopping in the US this year. But here too the amount of incremental growth captured is the shocking story, as the super scaler from Seattle and the beast of Bentonville are capturing nearly 75% of every incremental dollar spent online.

Even crazier is that Amazon and Walmart are capturing nearly 90% of incremental—and incredibly profitable—retail media spend.

Suspending the Law of Large Numbers

There’s a well-worn adage that the bigger you get, the harder it is to grow. The law of large numbers, people call it.

A $2 billion retailer can post well above average gains; a half-trillion-dollar one can’t, because the dollars needed to move the needle become harder to find. Growth drifts back toward the market’s pace. Gravity wins.

Apparently someone forgot to tell the giants.

Amazon’s North American retail grew around 9% last year, three times the broader industry’s rate, on a base north of half a trillion dollars. That single year added roughly $50 billion — an increment larger than the entire annual revenue of Macy’s, Nordstrom, or Best Buy.

Walmart, already the largest retailer on earth, grew fast enough to become the first traditional retailer worth a trillion dollars. Costco just keeps compounding. None of this is how a business behaves at the ceiling its size is supposed to impose.

The math wins eventually, as it always does, and at some point all three will start regressing toward the mean. The fashionable candidate for what finally provides a real headwind is agentic commerce. The theory is that once an AI agent shops the whole market on your behalf, assortment and discovery stop being moats, demand floats free of the platforms that hoarded it, and the field reopens.

Maybe.

But agents mostly optimize for price, speed, and convenience, precisely where Amazon and Walmart already win. What makes these companies formidable isn’t simply that they’re big. It’s that they are relentless optimizers operating at a scale no one else can approach.

Which is why their eventual deceleration won’t be the reprieve so many in the middle seem to be counting on. When the math finally bites, the share that comes loose won’t drift gently home. It likely flows to the next-best optimizer on the value side of the bifurcation. Almost no one else has anything sufficient to claw it back.

The giants slowing down was never a strategy you could wait out. The math may eventually turn against them, but right now this great concentration has a ton of momentum.

And if your goal was to out-Amazon Amazon or out-Walmart Walmart it’s never going to turn for you, least of all if your plan is merely delivering a slightly better version of mediocre.

So What, Who Cares?

Concentration stories tend to get filed under “interesting but inevitable.” Big gets bigger; it always has. Move on, nothing to see (or do) here.

Here’s what’s new. The giants are no longer just winning more than their share of the market. They’re winning nearly all of the growth, and growth is the only oxygen a retailer has. When retailers struggle to keep pace with inflation, that can foretell a profit squeeze, inevitably followed by rounds of cost-cutting and store closings. But eventually the core economics stop working completely.

Which takes retail’s great concentration back to the great bifurcation.

For a decade I’ve argued that the middle of retail — the merely adequate, the undifferentiated, the stuck-in-between — was being hollowed out. The concentration data is what that hollowing looks like once you put a number on it. The “retail apocalypse” was never an apocalypse; it was a culling of the retailers who ended up standing for nothing in particular once disruption took hold. And it’s far from over.

The uncomfortable truth is that there is no safe middle left to retreat to. You cannot out-scale Amazon and Walmart on price and convenience. That lane is taken, and it’s held by the two most operationally relentless companies in the history of commerce.

If you can’t be remarkably efficient and the middle is untenable, what’s left?

What’s left is to stop hoping to win a race to the bottom and instead race to the top.

The race to the top isn’t always about high price points and serving affluent customers.

It’s about delivering a remarkable experience, an assortment, or a point of view that an algorithm tuned for price and speed simply cannot replicate.

It’s something people will cross the street for, or drive many miles to enjoy — and afterward tell all their friends about, or amplify on social media.

It’s about more art than science.

Connection, not mass production.

Humanity, instead of indifferent efficiency.

Curation, craftsmanship, the merchant’s eye.

That is a narrow door. It is also the only one open for most of us.

ON THE POD

Strong sales. Sour sentiment. Tough turnarounds. The numbers and the mood are barely on speaking terms.

"The Analysts are back." Sucharita Kodali, Simeon Siegel, and Neil Saunders join Michael LeBlanc and me to unpack an earnings season where the results were largely good and everyone felt largely terrible.

Listen here, watch here, or follow us wherever you enjoy your podcasts.

IF THIS NEWSLETTER RESONATES WITH YOU. . .

BUY A BOOK. Remarkable Retail is the best-selling, highest rated retail strategy book of the past decade. Leaders Leap is my latest and it lays out seven mind leap to help you navigate a volatile and uncertain future.

BRING ME TO YOUR NEXT EVENT TO SPEAK. I’ve delivered inspiring keynotes at major events on six continents, as well been a featured speaker at dozens of corporate events, customer dinners, and the like.

SHARE THIS NEWSLETTER with a friend or colleague.

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“If you do not change direction, you may end up where you are heading.”

- Lao Tzu

It doesn’t take a lot of deep analysis to identify companies that have failed, or are failing, to transform at the speed of disruption. In the former case, they’re already in or on the way to the retail graveyard. In the latter case, they are either edging ever closer to the precipice or are spinning in the zone of irrelevance like whirling dervishes.

If you are at the helm of an organization that has a business model at or approaching its expiration date a metaphor might prove helpful.

It starts with a question.

Q. Have you ever seen a timid trapeze artist?

A. Of course not. There aren’t any; they either get fired or they get killed.

Seth has something important to say about this:

As the pace of change accelerates, as the gap widens between what customers demand and what you are prepared to offer, those who hesitate are increasingly lost.

Sunk cost are sunk.

Opportunity costs are real.

It can be incredibly scary to let of go of what made us successful in the past to make the leap into an uncertain and volatile future.

But you know what else is hard? Having to close stores and lay-off thousands of employees because we were too timid to make the changes we often knew deep down we must.

If the market is kicking your ass and you’re finding it harder and harder to acquire new customers or get current customers to advocate strongly for your brand, then it’s worth asking yourself: why am I working so hard to hold onto the status quo?

YOU KEEP USING THAT WORD . . .

I’ve literally been accused of being a literalist.

Which I think just means I care a little too much.

But we CAN find ourselves needlessly and avoidably wrapped around the axle if we get overly focused on semantics

Nevertheless, to make sense of an ever-changing and rather noisy world being clear and precise with language can be helpful.

For example, we can argue whether direct-to consumer (DTC) is a distinct business model or merely a distribution strategy (narrator’s voice: “it’s a distribution strategy”).

But regardless we shouldn’t use it as a blanket term for all of e-commerce or act as it was invented by the folks at Dollar Shave Club or Warby Parker. And while there are significant potential benefits—direct relationship with the customer, improve data capture, ability to better control end-to-end CX—it is not an inherently superior model. Take a look at what’s happened to most of the stocks of the new wave of “digitally-native vertical brand” disruptors over the last few years and you’ll quickly see what I mean.

“Experience” is another word that gets thrown around quite a lot, often followed by breathless pronouncements such as “retail is all about experience.”

Well, I’m sorry lamb chop, but if I just need to run into Walgreen’s to get some Tylenol I don’t need an experience, I just need some damn Acetaminophen stat.

Which brings me to this phrase, which has been oft repeated this year: “The consumer is resilient.” The problem here is that there is no one “consumer.”

While this statement exhibits truthiness it isn’t the least bit useful for crafting and executing strategy.

When 50% of consumer spending is driven by 10% of the population (at least in the United States), it’s far more accurate to say there is a small percentage of customers that are doing great and a whole lot that aren’t resilient at all. If you are anywhere close to serving the average customer that just means you work at Amazon or Walmart.

For the rest of us, we have to dig a lot deeper. And that’s likely to show a hell of a lot less resilience.

ON THE POD

The Remarkable Retail podcast is the among the most listened to podcasts globally—and the only major retail podcast with a 5-star rating on Apple Podcasts.

One of our top episodes from last year featured Jason Buechel, who does double duty as head of Amazon Worldwide Grocery Stores and CEO of Whole Foods Market.

Listen here, watch here, or follow us wherever you enjoy your podcasts.

WHERE IN THE WORLD IS STEVE?

I’m excited to share that I’m speaking at the CommerceNext Growth Show this June 23-24 in NYC! In fact, I’ll be kicking things off on Day 1 with Tractor Supply Company’s CMO Kimberley Sweet Gardiner.

The Growth Show is where retail’s best come together to connect, learn and share what’s working (and what’s not), all in the heart of retail: NYC.

You can attend my session by registering today. Retailers and brands get FREE tickets and all others will save 10% on General Admission registration by using my special code “REMARKABLE” at checkout. Go here for more info and to secure your spot.

IF THIS NEWSLETTER RESONATES WITH YOU. . .

BUY A BOOK. Remarkable Retail is the best-selling, highest rated retail strategy book of the past decade. Leaders Leap is my latest and it lays out seven mind leap to help you navigate the volatile and uncertain future.

BOOK AN ADVISORY VIDEO CALL. I’m now live on Intro.co for 1:1 concise and high impact advisory calls. For the month of June I’ll be donating 100% of my proceeds to World Central Kitchen. Secure time here.

BRING ME TO YOUR NEXT EVENT TO SPEAK. I’ve delivered inspiring keynotes at major events on six continents, as well been a featured speaker at dozens of corporate events, customer dinners, and the like. I can even do a book signing.

If the World Has Changed So Much, Why Have So Many Changed So Little?

“If you aren’t nervous you aren’t paying attention.”

- Miles Davis

I’m standing in front of some twenty top retail executives at a private event last year. I’ve been invited to share a few observations from my most recent book.

“This is the audience participation part of the program,” I begin.

“Quick show of hands: How many of you believe that the fundamental way retail operates has profoundly shifted over the past two decades.”

Everyone immediately raises their hand.

I continue. “How many of you would say that retail has changed quite dramatically in just the last five years?

Again, everyone quickly raises their hand.

“Now, how many of you believe that, in fact, retail will change even more in the next five years than it has in the past five.”

There’s a tiny bit of hesitancy on the part of a few, but eventually the room is filled with hands held high.

“And which of you would say you are extremely concerned about being able to keep up with the incredible speed of disruption?”

Here too, some pondering, but soon everyone has their hands up.

“So, now it’s time to get brutally honest. My final question for you is this.”

I pause for what I’ll admit is quite intentional dramatic effect.

“If the world has changed so very much, why have most of you changed so very little?”

Set the WABAC Machine for 1995

If you’re of a certain age, you’ll remember what shopping for just about everything was like three decades ago. While mail order catalogs we’re still around—and Amazon had just launched--nearly all shopping required a trip to one or more physical stores.

In this overwhelming analog dominant world, retail success was determined by a great location, strong personal customer service, an attractive physical environment, and, in many cases, the ability to tailor product assortments to local tastes. If you didn’t have the customers preferred brand, color, or size, you’d probably lose the sale to the competitor down the street or over at the mall. Except for some big-ticket items, customers would see what was on offer in-person, select what they wanted, take it to the cash wrap, pay (hopefully!), and cart it home with them.

Slowly at first, this all began to change. Amazon soon expanded its offering beyond books and CD’s. Other start-ups (eBay, Etsy, et al) disrupted various sectors of retail, offering an endless aisle, generally low prices, and the convenience of having products delivered to your home and office. Legacy brands, big and small, raced to stand-up their own .com operations.

A World Turned Upside Down

It’s hard to over-state the disruptive impact of the first wave of digital disruption, which fundamentally enabled entirely new ways of doing business, most notably online shopping and search. In 2007, with the release of the iPhone, a new era of connection dawned which propelled social media platforms and helped create so-called digitally native brands like Warby Parker, Glossier, and Casper.

By 2018 or so, with the growth of 5G and cloud computing, many digital first business models (Uber, Netflix, etc.) became some of the fastest growing brands in history as technology allowed data to connect with data at staggering speeds and increasingly lower costs. More and more, the best location for a retailer wasn’t a prime position on the High Street or in a prosperous shopping center, but how they showed up in the moments that matter on their customers’ mobile devices.

Most recently, Temu and Shein grew to be among the largest retailers on the planet. ChatGPT was launched less than three years ago. It now has a reported 300 million weekly users.

Sleepwalking Through the Revolution

While hyperbole IS the greatest thing ever, it’s not the least bit hyperbolic to state that these waves of disruption changed just about everything. ,

You say you want a revolution? Well, you got one.

Big time.

And yet, many of the most powerful legacy brands that the retail industry has ever witnessed did precisely nothing of any real consequence for more than two decades.

Blockbuster mostly sat around and watched while they got crushed by Netflix. Dominant category killers and multi-billion dollar specialty concepts like Borders, Circuit City, Linens & Things, Pier 1, Radio Shack, and Toys R US were faced with existential crises. Department stores that once accounted for some 14% of all US retail witnessed precipitous sales declines year after year after year, hemorrhaging billions to off-price retailers, super scalers like Walmart and Amazon, and more focused specialty players like Ulta and Sephora.

Hundreds of regional malls went from massive draws to what, for the ones that remain standing, can best be described as museums of disappointment.

Sears was once the biggest retailer on the planet. When I started my retail career there in 1991, we were holding on to the #2 global spot. Today, Sears, for all intents and purposes, exists as only a once glorious memory and a not terribly flattering Wikipedia entry.

Mind the Gap

Customers’ expectations have been completely rewired. What was previously scarce is now abundant. The friction that once allowed brands to build the proverbial moat is gone or evaporating.

Selling average products to average people at average prices has gone from a recipe for success to an express ticket to the retail graveyard.

The harsh reality is that the gap between remarkable retailers and those who continue to swim in the sea of sameness and engage in infinite incrementalism is growing.

The data is undeniable. Unpack which retailers are capturing the bulk of incremental retail revenues (and market value) and the number can be counted on two hands.

It’s a short list of mega-scale retailers that offer incredible value, in both time and money (Walmart, Amazon, Costco, TJX) and a select group of mostly upscale specialty concepts that mean a lot to relatively few (Vuori, OnRunning, Hermes, et al).

Aim Higher, Move Faster, Act Boldly

The media--and certain industry pundits--often celebrate once successful, but long suffering, retailers that show an improvement in their extended and woeful historical trend.

While one can’t pull out of a dive without a positive change in trajectory, history tells us that if all you are doing is closing gaps, rather than leaping ahead, you are most likely simply delaying the time it will take for you to crash back down to earth.

The simple fact is this: If you aren’t transforming at the rate that your core customers demand and that your best-in-class competitors are delivering, you are falling behind a bit less quickly, but you are still losing ground.

Sucking less is never a winning strategy.

And in a world that is changing ever faster this inability to transform at the speed of disruption may very likely create an existential crisis.

It’s not hard to understand why market share and value creation has shifted from the once dominant incumbents to industry disruptors. The winners of today have aimed higher in the value they deliver to their customers and have moved decidedly faster.

If you think innovating to parity is going to win back the customers that have defected while you were so very busy delivering a slightly better version of mediocre, it’s probably time to think again.

By the time you close any gaps, the remarkable retailers will likely have raised the bar once again, and you’ll have done a lot of running only to stand still.

Denial is a Hell of a Drug

Incremental change leads to incremental results. If you’re lucky.

Fortune favors the bold.

What seems safe is often the riskiest strategy of all.

And, to channel my inner Jack Kornfield, the problem may be that you think you have time.

NOTE: I’m taking this week and next off. This article appeared as my inaugural Substack post in December of last year.

ON THE POD

Episode 303 is built around one conviction from one of retail's most influential operators: the future is people-led and tech-powered. We reprise our interview with Chris Nicholas, former CEO of Sam’s Club, now CEO of Walmart International (18 countries, 5,700 stores, 500,000+ employees).

Chris’ case: innovation isn’t about replacing people with technology, it’s about using it to strip out friction, empower associates, and build better member experiences.

Technology serves the human, not the other way around.

Listen here, watch here, or follow us wherever you enjoy your podcasts.

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In 2013 legendary venture capitalist Marc Andreessen predicted that all retail would move online. He said the physical store was a doomed structure, and e-commerce would become the only form of commerce.

Lucky for him, he never specified a date. He’s been wrong, and not by a little.

In the dozen-plus years since he made what is looking like the world’s dumbest business prediction, retailers have opened many thousands of brick-and-mortar locations. Sales through physical stores in the US have grown every year, and stores still hold nearly 80% market share.

America’s largest retailers have committed north of $20 billion to remodel more than 12,000 stores. Dozens more have aggressive opening plans, from the old guard like Walmart, Target, and Costco, to newer brands like Warby Parker, Vuori, and Tecovas. Even Boot Barn is opening 70 locations a year on its way to 1,200. You do not put that kind of capital behind a structure you believe is doomed.

Andreessen’s mistake wasn’t his data or his read on e-commerce. It was that he didn’t understand what stores are for. He saw the store as the place where a transaction happens, and once the transaction could happen online, the store looked obsolete. But the store was never just a transaction point. It has a set of purposes, and the smart money has spent the last decade investing in them.

Jobs and Joys

There are two narratives here, and conflating them is the surest way to misread what’s happening.

The first is the job side. The value-oriented behemoths aren’t investing much in joyous, deeply human experiences; they’re investing in operational efficiency.

Walmart is partway through a $9 billion remodel program, with another 650 supercenters and neighborhood stores on deck. Target just unveiled its most ambitious store transformation in more than a decade: $5 billion, 130-plus remodels, 30 new stores, 300 new locations by 2035. Dollar General is refreshing more than 4,000 of its 20,000 boxes. Wider aisles, picking stations, drive-up canopies, refrigeration, digital price tags. It’s the store as the fastest, cheapest last-mile node a retailer has, and the place where BOPIS, curbside, and returns happen.

Stated simply, the job focused store serves the buyer. The joy side serves the shopper. And buying and shopping are not the same activity wearing different clothes.

Buying is a transaction, an errand, a problem solved efficiently, the logical brain knocking something off the to-do list. Shopping is another thing entirely: experience, discovery, identity, the pleasure of the hunt. Emotional, not logical. It’s one of the oldest human activities we have.

People have gathered to trade, browse, haggle, and show off for as long as there have been marketplaces. The agora, the souk, the Islamic bazaar, the medieval fair, the Japanese shotengai, the department store, the mall, the farmers market.

But Steve, What About All That Online Growth?

The objection goes: “If almost all incremental retail growth is online, why are these companies pouring billions into stores?” The premise is half wrong. Stores still account for the vast majority of retail sales. Walk away from that volume to chase the minority and you end up losing at both.

ICSC has been quietly building the best data set on this. Its Halo Effect III study found that opening a new store lifts online sales in that trade area by 6.9% over the following 13 weeks. For emerging and DTC brands, the effect nearly doubles, to 13.9%. Web traffic climbs roughly 37% in a market when a store opens. The asymmetry should keep CFOs awake: closing a store cuts online sales in that trade area by 11.5%. The clicks follow the bricks, and vice versa.

The store can be the dot-com’s most valuable asset, not its competitor. Every storefront is a billboard for the digital business, and the box itself is often the cheapest last-mile node a retailer has in a battle to neutralize Amazon.

But Wait, There’s More

McKinsey and ICSC just published a big report on the future of stores. Most of the coverage ran with the shiny number — agentic commerce, up to $1 trillion in U.S. B2C revenue by 2030 — and missed the actual point.

Far from making stores irrelevant, AI-driven commerce raises the bar. Every store needs a clearly defined role: convenience or discovery, speed or engagement, a destination to clear your to-do list or a place to tell brand stories and build your tribe. The more shopping moves upstream into AI enhanced discovery, the more the physical store matters, as either the fulfillment node that closes the loop, or the experience that justifies the trip.

McKinsey estimates the top decile of retailers will capture more than 85% of sector economic profit. That’s not a forecast of the death of stores, but it sure is an obituary for unremarkable retail.

The Joy of Shopping

It’s easy to see the joyful side of shopping as the squishy part of the argument. But that ignores the intensely human, soulful part of commerce, and it dismisses the harder evidence.

Prattle on all you want about frictionless this and seamless that. But then try explaining the Birkin bag, or the Masters merchandise tent at Augusta that does $70 million in seven days, with no website, no app, no loyalty program, and then disappears for a year.

Franklin Barbecue in Austin runs out of brisket most days and people line up before dawn anyway; the wait isn’t a defect in the operation, it’s the product.

Independent bookstores have grown for fifteen straight years. Barnes & Noble, written off a decade ago, is opening stores again.

Borough Market in London, founded in the thirteenth century, is packed with Gen Z every Saturday morning.

The generation that was supposed to finish off physical retail is the one buying vinyl, shooting film, and spending Saturdays at farmers markets. Not because they don’t know the frictionless alternative. Because they tried both and made a quality judgment.

None of that is sentiment. It’s revenue, foot traffic, and fifteen-year trend lines. The joy side isn’t the part of retail that resists measurement. It’s the part Andreessen’s frame and tech bro mindset couldn’t see.

The Deeper Point

Most of what we call “retail” today is really buying. Acquiring stuff. Replenishing stuff. Running the errand. Fulfilling a need.

Buying is a transaction, and a transaction is exactly the kind of thing that gets automated whether we like it or not. The logical brain is happy to hand the list to an agent while risking becoming increasingly subservient to our robot overlords.

Shopping is the other thing. Discovery. Belonging. The pleasure of being among other human beings. The hunt, and the serendipitous find. Fun, not merely satisfaction.

Buying is a problem being solved. Shopping is an experience a person actually wants.

That’s the part no algorithm gets to automate, because the whole point was to be there for it in person, for yourself.

Stores: What Are They Good For?

As it turns out, absolutely something.

Quite a lot, in fact, just not the one thing the left brain dominant types like Andreessen were measuring, sitting there smugly, and rather ironically, in their Patagonia vests.

They saw a transaction point, and transaction points really were up for grabs.

What they missed is that the store was always doing more than one thing.

Those who know they can’t out-Amazon Amazon or out-Walmart Walmart are betting that the joyous, intrinsically human part of shopping isn’t going anywhere.

We’ve been gathering in marketplaces for thousands of years, and a chatbot is not about to talk us out of it.

But if you can't get clarity on what your stores are for, the retail graveyard is very likely where you're headed.

MEANWHILE….

Where Irony Goes to Die

For fifteen years, Everlane sold one thing above all else: the truth.

Not just clothes, the truth about the clothes. The brand was built, brick by brick, on “radical transparency,” a phrase it used constantly and meant literally. Everlane named the factory that made the shirt, posted photos of that factory, and broke down the true cost (materials, labor, duties, transport) and then showed you its own markup, as if daring the rest of the industry to do the same. Sustainability wasn’t a layer bolted on later. It was the founding premise and the brand promise: we are the honest ones.

This week, Everlane sold to Shein.

Shein is the largest ultra-fast-fashion company on earth, and in nearly every respect the precise opposite of what Everlane spent fifteen years claiming to be. Everlane published its factory list; Shein’s supply chain is famously, and it would seem deliberately, opaque. Everlane made a moral argument for fewer, better things; Shein’s whole model is velocity, thousands of new styles a day, priced to be nearly disposable, tuned by algorithm for one outcome: buy now, buy more. Everlane talked about the planet; Shein generates the textile waste and carbon footprint Everlane built its brand to stand against.

The transparency brand is now owned by the opacity machine.

What a time to be alive.

How did the honest brand end up here? Well, follow the money.

Everlane had struggled for years. The deal values it at roughly $100 million, a number that exists mostly to clear about $90 million in debt. Common shareholders get nothing. A brand once valued near $600 million was sold to settle its tab. And in a sale process with few real bidders, a company’s values don’t get a vote.

A company can spend fifteen years building a set of values and mean every word of it. Soul can be worth a fortune, it’s most of what makes the great brands great. But it only pays while the brand is winning. Once the money runs out, the soul runs out of leverage. The gap between what a brand means to the people who love it and what it’s worth to the people who own it has rarely been this naked.

ON THE POD

This week on the Remarkable Retail podcast, we sit down with Eric Sadi, Co-President, NA at Simon Property Group, to discuss why mall obituaries keep aging badly as Simon’s occupancy sits above 96%, tenant sales keep climbing, and anchor boxes give way to mixed-use destinations built for the human connection.

PLUS: standout earnings from On Running and The RealReal, renewed inflation worries as fuel and food costs climb, and GameStop’s bid for eBay hits a wall. Listen here or watch on our YouTube channel.

WHERE IN THE WORLD IS STEVE?

I’m excited to share that the Remarkable Retail Podcast is the official pod of the Commerce Next Growth Show. The Growth Show is where retail’s best come together to connect, learn and share what’s working, all in the heart of retail: NYC.

And we’re pleased to offer a special discount for our listeners. Retailers and brands get FREE tickets while others save 10% on General Admission registration using special code “REMARKABLE” at checkout. Go here for more info and to secure your spot.

A Faster Horse and the Best Blacksmith in Town

In 2021, Netflix put up a billboard in Hollywood that read:

DON’T GIVE UP ON YOUR DREAMS. WE STARTED WITH DVDs.

Take a moment and let that message sink in.

Three business models in just over a decade — DVDs, streaming, original production — each one a reinvention of what came before.

The billboard is neither defensive nor nostalgic. Just: we were that, now we're this. And the distance between the two is the whole story.

Most organizations can’t do that. Not because they lack the wit to write the billboard, but because they’re still in their own version of the DVD business and they know it. And yet they can’t bring themselves to let go.

Here’s the thing about a model whose time is running out: a slightly better version of it won’t save you. It won’t just fail to make a difference, it will distract you from taking the leaps you actually have to take.

I wrote this in Leaders Leap and I’ll keep writing and speaking about it until it stops being true. Which, sadly, and for so many organizations, doesn’t appear to be anytime soon.

The faster horse and the best blacksmith tend to get invoked separately. The faster horse as a cautionary tale about listening too literally to customers. The blacksmith as shorthand for obsolescence.

I want to talk about what happens when they show up together which, in my experience, can be quite often.

Henry Ford is credited with the line: “If I had asked people what they wanted, they would have said faster horses.” While Ford was reinventing transportation, the best blacksmith in town was thriving. Great reputation. Loyal customers. Refined craft.

Until he wasn’t.

You’re Going to Need a Bigger Moat

Blockbuster wasn’t brought down by bad management. They ran a tight operation. Clean stores, a great selection, loyal customers: a model they spent years perfecting.

Netflix didn’t build a better video rental store. They made the video rental store irrelevant. Customers didn’t want a better way to drive to a store, find a movie, and pray they returned it on time. They wanted an evening of entertainment.

Airbnb didn’t build a better hotel. They rewired the entire supply side of where you sleep when you travel.

Uber didn’t improve the taxi. They rebuilt what it means to get from point A to point B.

In each case, the incumbents weren’t beaten at their own game, the game changed. And they kept playing the old one better as fewer and fewer people showed up to watch it.

That’s the blacksmith trap. Not failure, but excellence that became irrelevant or unseen. World-class execution of something the world was quietly leaving behind.

The Faster-Horse Problem

The other trap is subtler. And in my experience, more widespread.

When real change is coming — when customer desires are shifting, when a disruptive model is gaining traction somewhere out on the edges — the instinct of most organizations is to optimize what they already do. Listen harder to current customers, improve current products, and work tirelessly to close current gaps.

In Leaders Leap I call this infinite incrementalism. It feels like great management and it produces results you can defend in a board presentation.

And it almost always sends you down a road to nowhere.

Here’s the problem: customers can tell you what they want more of but they can’t tell you what they haven’t yet imagined. Ford’s customers wanted a faster horse because a car wasn’t in their frame of reference. Blockbuster’s customers wanted more titles and better late fees right up until they didn’t want any of it.

The faster-horse approach optimizes for the world as it is. Disruptive models solve for the world as it’s becoming.

Most legacy organizations never make that shift. Not for lack of talent or money but because the current model is still working well enough and the new one means cannibalizing what you’ve built, betting on an uncertain future, and accepting that your best customers today may not be the ones who matter most tomorrow.

That’s genuinely hard to do when the board is watching and the quarterly clock is ticking.

I’m the Problem. It’s Me.

None of this happens in a vacuum. Organizations are run by people, and people are wired to defend what made them successful.

In Leaders Leap I call it “executive ego dysfunction.” Past success quietly reinforces how leaders read the present. The model that built the career becomes the model that gets defended. The instincts that were rewarded become the ones that get trusted, typically long past their sell-by date.

“The truth you believe and cling to makes you unavailable to hear anything new.”

- Pema Chodron

Clayton Christensen nailed the structural version of this in The Innovator’s Dilemma. Incumbents aren’t irrational. They’re doing exactly what good management looks like: listening to their best customers, protecting their most profitable lines, optimizing the core. The tragedy is that all of it is exactly wrong for a world in the middle of a fundamental shift.

The antidote is what Zen Buddhists call shoshin — beginner’s mind. Zero attachment to being right and a genuine willingness to ask whether what you’re defending is what actually wins the future.

This can be brutally hard to do, especially for people who’ve spent careers being rewarded for certainty.

Let Go of the Rope

I’ve written before about the timid trapeze artist and Seth Godin’s observation that you can’t get to the next rope if you’re still holding on to this one. The trapeze piece is about the fear and psychology of letting go. This one is about what you’re letting go of: a model the world is walking away from, optimized to within an inch of its life, defended with everything you’ve got.

The best blacksmith never saw it coming. Not because he wasn’t paying attention or because he lacked skill, but because being world-class at something the world is leaving behind isn’t a competitive advantage, it’s a trap. A comfortable, well-crafted, thoroughly decorated trap.

Actually it’s two traps: the faster horse and the best blacksmith, showing up together more often than most leaders want to admit.

The question worth sitting with — genuinely, not just nodding at — is simple.

Are you getting better at the right thing or are you just getting better?

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ON THE REMARKABLE RETAIL PODCAST

"Retail's Great Concentration" is accelerating. Just six retailers now capture the majority of industry growth, and the structural forces behind it aren't slowing down.

PLUS: Tapestry delivers strong earnings, Warby Parker shows profitable growth, and GameStop bids for eBay in what is likely the dumbest retail story of the year. Listen here or watch on our YouTube channel.

THREE OTHER IDEAS FROM ME THIS WEEK

Book a 1:1 Advisory Call. I’m now on Intro.co for focused, high-impact sessions. Secure time here.

Bring Me to Your Next Event. I’ve delivered keynotes at industry conferences on six continents and spoken at corporate events, customer dinners, and book signings around the world. Reach out at events@sageberryconsulting.com.

Buy a book. Remarkable Retail is the best-selling, highest rated, retail strategy book of the past decade. Leaders Leap will help you navigate the choppy waters of disruption.

300

What 300 Conversations Taught Us About Retail’s Relentless Now

Earlier this week, Michael LeBlanc and I dropped our 300th episode of the Remarkable Retail Podcast. When we launched in the fall of 2020, I wasn’t sure our little Covid project would make it to 30.

Podcasting is a long game and most shows don’t survive their first season. The ones that do often drift, chasing trends, recycling hot takes, becoming a vehicle for guests to flog their books, latest SAAS solution, or AI start-up. Others lose their authenticity as they serve sponsors, not the audience.

Five years, twelve seasons, 300 episodes later, we’ve stayed obsessed with the same question we started with: what actually separates remarkable retail from the vast sea of sameness? The answer keeps evolving, and that’s largely why we keep at it.

Here’s what doing this for half a decade has seared into my brain.

The Conventional Wisdom Is Frequently Wrong

“Stores are dead.” “Physical retail is back.” “Amazon wins everything.” “DTC is the future.” “The Metaverse is about to change everything.” “It’s all about experience.” “It’s all about convenience.” “It’s all about seamless.”

We’ve watched every one of these narratives rise, get weaponized by consultants and breathless trade press, take center stage at conferences, and then quietly fall apart under the weight of actual evidence.

The truth is typically messier and less convenient than the consensus view. Retail rewards nuance and punishes sloganeering. And yet the slogans keep coming.

Part of what we’ve tried to do, week in, week out, is slow the narrative down just enough to ask: is this actually true, or does it just feel true right now?

The honest answer is usually somewhere in between, which makes for a less satisfying headline but a far more useful place from which to make decisions that matter.

The Best Leaders Ask Better Questions

Our most memorable guests weren’t the ones with the most polished talking points or a regurgitation of an investor presentation.

They were the ones genuinely wrestling with hard problems in public — comfortable enough in their own strategic skin to say “we don’t have this fully figured out yet” while still having the conviction to take the leaps they must to stay relevant.

That kind of intellectual honesty is rarer than it should be at the C-suite level.

The leaders who’ve impressed me most share one trait: they’re more interested in understanding the problem correctly than in being seen to have all the answers. The ones who arrive already certain tend to be the ones we’re dissecting a year or two later, and usually not in a very flattering way.

Most Retail Struggles Are Strategy Problems, Not Execution Problems

This might be the single most durable thing five years of conversation has reinforced: the brands in trouble almost always saw it coming.

The department stores saw Amazon, TJX, and Sephora. Legacy grocers saw Aldi, Trader Joe’s, and Sprouts. Mid-market apparel brands witnessed the squeeze develop from both ends for many, many years.

And yet they mostly sat around and watched the last twenty years happen to them.

What they lacked wasn’t information. It was the will to act before the crisis forced their hand.

Real transformation means cannibalizing what’s working today to build what you’ll need tomorrow. It means making bold leaps when incremental steps feel safer and more defensible to your board.

Most organizations resist this until they have no choice.

And by then the window for a genuine turnaround has usually closed considerably more than they’d like to admit. We’ve said some version of this on the show more times than I can count.

Retail Is a Human Business

This is the thread that runs through most conversations worth having on the show.

The technology changes. The channels multiply. Consumers keep surprising the most confident forecasters.

But many of the brands we’ve showcased — Vuori, Tecovas, Warby Parker, to name a few — keep finding ways to make people feel something: seen, served, connected, delighted, occasionally genuinely surprised.

They understand the soul of their store and work to deliver a true sense of meaning and belonging for their customers.

They know that real joy is different than mere satisfaction.

The ones that outsource that responsibility to an algorithm or a cost-reduction initiative tend to show up in our zone-of-irrelevance analysis eventually.

This isn’t nostalgia, and I am most definitely not anti-technology. It’s just a recognition that the reason people shop — not just transact — is fundamentally and irreducibly human.

The difference between those two things, and what’s at stake when we collapse them into one, is something I’ve been thinking hard about lately.

Much more on that soon.

And. yet protecting that distinction, even as everything else accelerates, may be the defining strategic challenge of the next decade.

A Moment of Gratitude

Thank you for listening, sharing, and pushing back. None of this works without an audience willing to take ideas seriously.

Thanks as well to our amazing guests. We’ve been fortunate to have far more retail CEOs and founders on the show than any other pod.

Extra special thanks to Michael—my brother from another mother—for all he does to make the show happen and for putting up with (most of) my nonsense.

🎧 Listen to Episode 300 here—and if you’ve been meaning to add to our string of 5-star reviews what better time than now?

QUICK HITS

Ryan, I Love You, But You Are Not a Serious Person

I was pretty sure the Allbirds becoming an AI platform would be the dumbest retail story of the year, but I was wrong.

Let me put the facts on the table, because they deserve to be savored slowly.

GameStop’s market value is about $11 billion. GameStop has offered $125 per share in cash and stock for eBay, at roughly a 20% premium, valuing the deal at approximately $56 billion. GameStop has $9 billion in cash and another $20 billion in debt financing from TD Bank.

Now I’m not great at arithmetic but I’m pretty sure that doesn’t comes anywhere close to the $56 billion on offer. The math isn’t mathing.

But wait, it gets better.

Having lobbed this grenade into the financial press on a Sunday, GameStop CEO Ryan Cohen went on CNBC’s Squawk Box Monday morning to explain himself. What followed was remarkable television. When asked whether he’d had any conversations with eBay, there’s a deeply awkward pause before Cohen, in his mid-life-crisis black leather jacket, says “…No.” Then after another glacial pause, “We’re just starting.”

Andrew Ross Sorkin pressed Cohen on the financing, noting that GameStop’s market cap is nowhere near $56 billion and asking him to walk through how the math could possibly work. Cohen’s answer was “Half cash, half stock.” Then he said it again. Then he appeared to get stuck in a loop, like a glitchy, sleepy robot.

When Becky Quick pressed further, Cohen snapped: “I don’t understand your question,” followed by an awkward silence.

The plan, as articulated in the press release, is to slash $2 billion from eBay’s cost structure in year one and use an “entrepreneurial mindset” to make it a “legit competitor to Amazon.”

Amazon, the company with 200 million Prime subscribers, its own logistics network, and a 30-year head start? That Amazon?

But it was Michael Santoli’s question that cut to the bone: “Where’s the evidence that you know how to grow a mature consumer business?”

Ouch.

Chewy was a startup Cohen built from scratch. GameStop has been, by any honest assessment, an empty shell dressed up as a turnaround.

The meme stock faithful may be cheering. But this is what it looks like when a business story stops being a business story and becomes performance art for an online fandom.

ON THE POD

On this week’s big milestone episode of the Remarkable Retail Podcast our guest is Nordstrom Co-CEO Pete Nordstrom.

We sit down with one of retail’s most respected executives for a rare, candid conversation — tracing Pete’s journey from the stockroom to the corner office, and looking ahead at what’s next for one of North America’s most iconic retailers.

Listen here or watch on our YouTube channel.

WHERE IN THE WORLD IS STEVE?

I’m excited to share that I’m speaking at the CommerceNext Growth Show this June 23-24 in NYC! In fact, I’ll be kicking things off on Day 1 with Tractor Supply Company’s CMO Kimberley Sweet Gardiner.

The Growth Show is where retail’s best come together to connect, learn and share what’s working (and what’s not), all in the heart of retail: NYC.

You can attend my session by registering today. Retailers and brands get FREE tickets and all others will save 10% on General Admission registration by using my special code “REMARKABLE” at checkout. Go here for more info and to secure your spot.

Leading at the Speed of Disruption

If you’ve been paying any attention at all you can clearly surmise that we’re not remotely close to peak disruption.

And the pace of change is becoming more exponential than linear.

This is not a drill.

Ludicrous Speed

ChatGPT reached 100 million users in two months. Instagram took two and a half years. TikTok nine months. The adoption curves for transformative technology keep compressing. What used to take a decade to reshape an industry now takes a few years. And increasingly quite a bit less.

Agentic AI has moved from lab curiosity to operational reality faster than most enterprise roadmaps can accommodate. Geopolitical chaos is rewriting supply chains in real time. Consumer behavior keeps evolving in ways that defy easy or reliable forecasting.

The organizations that treated the last five years as an aberration — a speed bump on the way to steady as she goes — are finding out there is no normal to return to.

Nobody Knows Nothing

The destination is genuinely unclear.

Anyone who tells you they know exactly how AI, robotics, or any other form of rapidly advancing technology will reshape the landscape over the next few years is wrong, lying, or trying to sell you something.

We may be able to see the forces ever more clearly but nobody can map the endpoint.

And this cuts in two directions, both potentially dangerous.

The first failure mode is moving too slowly, dismissing real signals as noise until the gap becomes unbridgeable. The second is chasing the bright shining object.

Every era produces technologies and disruptive new business models wrapped in so much hype that otherwise sensible leaders abandon their judgment and pile in.

Second Life was going to remake commerce. The metaverse was going to change everything. Apple Vision Pro arrived with the full force of Apple’s credibility and engineering and still landed with a thud. Quidsi built a genuinely good business that was executed well and grew fast, but still got steamrolled. Similarly named Quibi, a short-form mobile streaming platform, managed to raise nearly $1.75 billion from investors, but crashed and burned just six months after launching.

And does anyone remember Clubhouse?

The peak of inflated expectations is typically followed by the trough of disillusionment and then, sometimes, by transformation that arrives quieter and later than the headlines suggested. Don’t confuse the hype with the signal, or the trough with irrelevance.

Uncertainty isn’t a reason to freeze. It’s a reason to stay curious, keep the aperture wide, and resist the pull of any single narrative.

Your Mileage WILL Vary

Not every industry is being disrupted at the same speed. Not every business faces the same imperative. Some categories and companies are far more insulated than others.

Your dry cleaner isn’t losing sleep over agentic AI. The best high-end restaurants have waitlists measured in months because what they sell is irreducibly human and appropriately local. Craftsmanship, curation, the merchant’s eye, aren’t easily disintermediated. And it turns out robots make lousy pastry chefs.

Pretending otherwise is its own form of bad thinking.

But for most businesses at any meaningful scale, the question isn’t whether disruption is coming. It’s how fast and from which direction.

So what is YOUR speed of disruption?

Not the industry average. Not your competitors’ investor presentations. The actual rate at which the landscape specific to your business — your customers, your category, your competitive set — is shifting.

Far too many leaders get this wrong, because the speed of disruption tends to be faster than it appears from inside the institution.

You’re likely surrounded by people with incentives to defend the status quo. Your data surfaces what you’ve already decided to look for. The signals that should alarm you get explained away as noise, as outliers not applicable to your situation.

That disconnect is where most transformation failures begin. By the time it’s undeniable, the options have narrowed considerably or the gap has simply become too wide to close.

Calibrate too conservatively and you risk being too late. Move too aggressively and you may outrun your organization, your customers, or your economics.

It’s your job to know the difference.

Fortune Favors the Bold, Not the Stupid

Amazon’s principle: cutting edge, not bleeding edge. Don’t be first for its own sake and move fast enough to matter.

You probably know this mantra: the first mouse gets the trap, the second mouse gets the cheese.

Amazon wasn’t the first online bookstore. Google wasn’t the first search engine. Facebook wasn’t the first social network. Sometimes letting the first mover absorb the arrows and then moving decisively with better information is the smarter play.

The second (or third or fourth) mouse often wins. The mouse going Ludicrous Speed, all throttle and no navigation, ends up in a different galaxy wondering what the hell just happened.

Bold means running experiments while others debate whether to run them. It means the cost of moving too slowly isn’t a future risk, it’s a present one, compounding quietly while you deliberate.

Stupid means confusing urgency with abandon. Chasing the hype, behaving recklessly, letting anxiety push you into action without clarity about what you’re trying to accomplish.

Organizations that freeze lose. Organizations that sprint in every direction lose just as badly and usually faster.

The leaders who leap smartly, with clear intention, are the ones still in the conversation five years from now.

Will you join them or will you be watching from the stands?

ON THE REMARKABLE RETAIL PODCAST

Why do leaders confuse past success with future relevance? Sometimes it’s not fear — it’s a failure of imagination. Plus: is DTC all it’s cracked up to be, strong sales vs. cratering consumer confidence, and Walmart doubles down on stores. New leaders at lululemon and Best Buy face their first real test: break from the playbook or get buried by it.

Listen here or watch on our YouTube channel.

DEPARTMENT OF HUMBLEBRAGS

I'm honored and grateful to be named to the RTIH Top 100 Retail Technology Influencer list. You can see the whole list is here.

ANCHOR STORES

How the Department Store Went from Linchpin to Millstone

The OG Blueprint

The anchor store was never an accident. It was a blueprint.

When the modern American mall took shape in the 1950s and 60s, developers placed department stores around the perimeter with deliberate precision. Three, four, sometimes five anchors, each a destination in its own right. Developers lured Sears, JCPenney, and regional powerhouses with sweetheart deals like little or no rent and build-out contributions. The traffic they generated was worth far more than any subsidies. The arrangement let them charge nearby specialty retailers premium rents and keep the whole machine humming.

As Americans headed to the suburbs in pursuit of the American Dream, regional malls went up all over the country. Within two decades, malls had become the predominant retail format for millions of shoppers. Sears alone became one of the ten most valuable companies in America by the 1970s.

For decades, it worked exactly as designed.

The Architecture of Desire

Victor Gruen didn’t set out to engineer a shopping center. He set out to build a town square.

His vision was a suburban antidote to sprawl: dense, walkable, climate-controlled environments where people could gather as much as they shopped. Retail was the engine, but not the purpose.

And for a time, that balance held.

As Alexandra Lange documents in Meet Me by the Fountain, malls became de facto public squares for millions of Americans. Teenagers, retirees, families. Not just a place to shop. A place to be.

But Gruen also understood that design shapes behavior. His layouts were deliberately hard to navigate: no straight lines, no easy exits, no obvious way out. Whether that was manipulation or simply the texture of a European marketplace translated to the suburbs depends on who you ask. Gruen would have said the latter. His critics, the former. Either way, it worked.

Anchors pulled you in. Corridors carried you forward. The environment made wandering feel natural and time feel elastic.

Department stores sat at the center of that system. You came for Macy’s or Marshall Field’s or Foley’s. You left having spent more than you planned.

At their best, these places delivered something more. The Walnut Room at Christmas. The Nordstrom piano player. The white-glove personal shopper at Neiman Marcus. Service as theater. Retail as a joyful experience.

Gruen lived long enough to see how it evolved. He didn’t like what he saw — the stripping away of the soul of shopping in favor of pure commercial expansion.

It wasn't a betrayal. It was a business decision rooted in relentless optimization.

Facts Are Stubborn Things

Over the past two decades, department stores’ share of total retail has collapsed from 10% to 1.8%. Since 2019, overall retail has grown 40%. JCPenney is down 40% over that same period. Macy’s is down 12%. Nordstrom, Bloomingdale’s, and Dillard’s have done better, but none have kept pace with inflation.

The problem isn’t confined to North America. Department stores overall worldwide revenue grew under 1% last year. Outside of a handful of locations that remain genuine destinations the global picture looks remarkably similar. Expenses growing faster than sales. Mounds of unproductive inventory and under-utilized space.

When your sales grow far slower than the rate of the inflation you’re not running a retail business, you’re managing a decline. The only moves left are cutting costs, cutting service, and closing stores.

And speaking of store closings…

Sears, once one of the ten most valuable companies in America and where I started my retail career some three decades ago, is effectively gone. JCPenney has shed nearly half its stores since 2019. Macy’s “Bold New Chapter” calls for closing more than 150 locations. That number is likely to grow. Neiman Marcus and Saks recently announced they’re shuttering over 40% of their full-line stores.

Across the country, former anchor boxes aren’t just sitting dark. They’re being demolished. Gutted for apartments, medical facilities, pickleball courts, storage. Not remodeled. Removed. When the physical building becomes the problem to be solved, the argument is over.

Yet many are still standing empty. Still dragging the mall's sense of possibility down with them.

What was designed to hold everything in place became the weight pulling it down. The anchor didn’t just stop working. It started pulling in the wrong direction. The linchpin became the millstone.

Here’s the cruel irony. Mall traffic has actually recovered. Top-tier malls are seeing foot traffic at or above pre-pandemic levels. Consumers are coming back to physical retail. They’re just not going to the department store when they get there.

The mall came back. The anchor didn’t.

Museums of Disappointment

Walk into almost any department store in North America and the evidence is right there on the floor.

Over-assorted. Often ridiculously over-spaced. Undifferentiated merchandise as far as the eye can see. As I wrote in Remarkable Retail, most are increasingly stuck in no-man’s-land, swimming in a sea of sameness. Endless promotions that erode price integrity, an okay experience but little that’s memorable, some sales help but nothing particularly useful.

And then there's this: most of the brands being sold inside that department store opened their own shops down the mall years ago and invested heavily in e-commerce. Ralph Lauren. Coach. Levi’s. An ever-growing roster of luxury brands. They didn't just compete with department stores. They taught customers that the brand experience was often better without the department store in the middle.

The anchor helped fund its own irrelevance.

What Did You Do During the Revolution?

Most department stores, to put it plainly, are built for an era that no longer exists.

We could see this coming from a long way away.

My sense that mid-priced department stores were dead brands walking started to develop way back in 2003 during my last year at Sears. It accelerated during my four-year tenure that followed at the Neiman Marcus Group.

During the multi-decade decline virtually every department store fell victim to “the Innovator’s Dilemma.” While market share losses to off-price retailers, specialty stores, the DTC operations of their own vendors, and Amazon became massive, not a single major department store anchor did anything truly transformative.

Not one.

The answer to the question “what did you do during the revolution” became “we watched” or, more charitably, “we invested in an endless cycle of incremental improvement that changed nothing fundamental.”

The right response would have been aggressive reinvestment instead of cost cutting and store closings. The right response would have been to test a genuinely new concept capable of winning in the world that was emerging — the way RH reimagined the furniture showroom with its Gallery concept or Dick’s reimagined the sporting goods superstore with House of Sport.

Instead, the capital went to dividends and stock buybacks. When you’re in structural decline and your answer is returning money to shareholders rather than investing in reinvention, you’ve already made the decision. You just haven’t announced it.

At some point the math stops working, the investors stop believing, and the customers have long since moved on. You don’t need another set of underwhelming initiatives marketed as a bold transformation strategy.

You need a time machine.

RULES FOR (RETAIL) RADICALS

#6: Crush Your Ego

“Sit down, be humble.”

- Kendrick Lamar

Two years ago this week Leaders Leap landed. My second book opens with a simple provocation: the biggest barrier to bold leadership usually isn’t the market, the competition, or the board. It’s the person in the mirror.

Mind Leap 1 is “Crush Your Ego”. It’s first for a reason.

Look around. We are living through a golden age of ego dysfunction. In politics, in culture, in business, the loudest voices in the room have confused certainty with strength, dismissed asking for help as weakness, and decided the only input worth considering is whatever confirms what they already believe.

Retail is not immune. The CEO convinced the brand’s best days are ahead because they’ve always been ahead. The merchant trusting gut over data because the gut was right in 2015.

Ego doesn’t always look like arrogance. Sometimes it looks like certainty. As Adam Grant argues in Think Again, the assumptions, instincts, and habits we cling to most tightly are often the ones most likely to get us killed.

The antidote is what Zen Buddhists call shoshin — beginner’s mind. Openness, curiosity, zero attachment to being right.

The retailers winning today aren’t the ones with the most confident leadership. They’re the ones willing to be wrong, ask for help, and unlearn faster than the competition.

That starts with getting out of your own way.

ON THE POD

On this week’s episode of the Remarkable Retail Podcast it’s Part 2 of the “Retail Rumble” recorded live on stage at Shoptalk.

Round 1: Can Department Stores Be Resurrected? Yours truly takes on Ken Pilot. Round 2: Is AI a Threat or Opportunity for Your Job? Lauren Livak Gilbert debates Sarah Engel on whether AI is an existential threat to retail jobs or the biggest productivity unlock in a generation.

Listen here or watch on our YouTube channel.

TWO OTHER IDEAS FROM ME THIS WEEK

1. Bring me into your company or to your next event to speak.

2. Schedule a high impact video consultation with me.

Shut Up and Play the Hits

Maybe you’ve been to the famous comedian’s show where the easy laughs come from bits you’ve already seen on Fallon, Kimmel or his five-year-old Netflix special.

Maybe you’ve gone to hear a marketing guru at an industry conference and grown restless as she talks about her just-released book—until she pivots to the famous material and the room comes back to life.

Maybe you’ve attended a concert by an iconic rock band and grown impatient with the lead singer’s extended stage patter and the songs off the new album you haven’t listened to yet. You know that’s your signal to head to the restroom.

We all know the feeling. And we all know the instinct it triggers.

Why can’t they just shut up and play the hits?

The Lure of the Familiar

The phrase “shut up and play the hits” comes from a 2012 documentary about LCD Soundsystem's farewell concert at Madison Square Garden. At one point, Win Butler of Arcade Fire shouted it at frontman James Murphy as he was introducing a song.

Stop talking, just do the thing you're known for. The film took its title from the moment.

There’s a retail version of this playing out everywhere. Except it’s not a loving crowd demanding an encore. It’s an organization — its incentives, its processes, its institutional memory, an ossified culture — quietly but relentlessly pulling leadership back toward the familiar.

The Setlist Never Changes

Non-profits return again and again to golf tournaments and galas.

Consumer packaged goods companies churn out endless iterations of long-standing bestsellers. When inspiration runs dry, there's always pumpkin spice applied liberally to anything that will hold still long enough.

In retail, it's common practice to go back to the same well with tweaks and minor iterations to long-standing merchandising practices and marketing promotions. Job One is often just to "anniversary" last year's numbers.

As someone who’s spent most of his career in strategy and innovation, I’ve often had the job of playing devil’s advocate and asking “Why do we do that here?”

The company might be quite obviously edging toward the precipice, but when I challenge a strategy that seems largely irrelevant or quite incremental, the pushback is typically immediate and defensive. The answer is almost always some version of because it works.

Of course, the definition of what works is relative and constantly shifting. And if it was working so well, how did the company find itself in so much trouble?

Rinse and Repeat

Nobody did it more faithfully — or more fatally — than Bed Bath & Beyond.

For decades, that 20%-off coupon was everywhere — in your mailbox, in your inbox, crumpled at the bottom of your purse. It worked brilliantly, until it became the entire strategy. Customers were trained so thoroughly they simply wouldn’t buy at full price. The coupon that once drove traffic eventually destroyed margins, undermined the brand, and became a trap the company couldn’t escape.

We pull the same arrows from our quiver because they are familiar. We tweak the tried and true because it feels safe. We play our greatest hits because it gets the response we want.

Until it doesn’t.

A Failure of Imagination

It’s tempting to diagnose this as a courage problem. Fear is certainly part of it. But I think the more honest and more unsettling diagnosis is a failure of imagination.

Most leaders can tell you in precise detail what a better version of their current model looks like. Very few can describe something genuinely different. Not an improved store. A different store. Not a refreshed brand. A reimagined one.

For years, Abercrombie & Fitch couldn’t see past its own mythology: the shirtless greeters, the dim lights, the exclusionary cool. It took new leadership willing to imagine a fundamentally different brand — different customer, different aesthetic, different values — to unlock what turned out to be one of retail’s most remarkable turnarounds. They didn’t improve the old model. They replaced it.

Without fierce intention imagination atrophies. The longer an organization has spent optimizing the same model, the harder it becomes to picture a fundamentally different one. The hits don’t just crowd out new songs. Eventually, they crowd out the ability to write them.

Left to its own devices, strategy sessions that should be generative become defensive. The question shifts from what could we become to how do we protect what we have.

But you cannot lead people toward a destination you can’t see.

A New Setlist

The tried and true has a shelf life. What once made you remarkable will eventually make you merely adequate, and then largely invisible.

The test isn’t whether your current hits are still drawing a crowd. It’s whether you’re writing the songs that will matter in five years.

Most companies never ask that question. They’re too busy rehearsing the songs they already know by heart.

James Murphy eventually figured that out. LCD Soundsystem came back, wrote new material, and found a new audience without completely abandoning the old one.

In retail, going back to the hits after the audience has moved on isn’t a comeback.

The audience isn’t waiting for a better version of what you’ve always done.

They’re waiting for something remarkable.

QUICK(ISH) HITS

Boots on the Ground

Watch this til the end. I’ll wait.

Tecovas just released Love Letter to Texas — a 14-minute film directed by Jeff Nichols, starring Ryan Bingham, Michael Shannon, Hassie Harrison, narrated by Sissy Spacek. Shot in Marfa. Premiered at SXSW.

“Tecovas Presents” opens the film. The brand name doesn’t appear again until the final title card.

The performance marketing crowd will tell you this is madness. You can’t attribute it. You can’t optimize it. There’s no click-through rate on a short film. What’s my ROAS?

But when every brand is running the same targeted ads against the same audiences on the same platforms, differentiation lives in whether people actually feel something.

Tecovas isn’t selling boots. They’re building a world people want to belong to.

That’s buying culture, not clicks.

Turns out that’s the real performance marketing.

Gradually, Then Suddenly, Then GPU

Allbirds spread its wings Wednesday—right into a server farm.

Two weeks ago the once-darling sustainable footwear brand announced it's selling its shoe business for $39 million. This week it's keeping the Nasdaq shell and relaunching as "NewBird AI," a GPU-as-a-Service and AI compute infrastructure provider, backed by $50 million in convertible financing.

The stock, which had fallen from a $4 billion peak to a market cap of roughly $21 million the day before, surged over 700%.

Allbirds was always a better story than a business. The merino wool. The carbon transparency. The Silicon Valley founder uniform. For an all too brief moment it looked like proof that a brand might win on values alone.

And yet GPU farms aren’t exactly known for their low carbon footprint.

Yes, this is a real story. Not the Onion. Not an April Fools’ joke that got delayed a couple of weeks.

What a time to be alive.

ON THE POD

Recorded live on stage at Shoptalk Las Vegas Part 1 of the inaugural edition of the Retail Rumble!

ROUND 1: Is ecommerce about to enter a new phase of accelerated growth? Neil Saunders & RJ Hottovy battle it out.

ROUND 2: Does Retail Media improve the shopper journey? Kiri Masters takes on Rachel Tipograph.

Stay tuned for ROUNDS 3 & 4 next week.

Listen here or watch on our YouTube channel.

HAPPY ANNIVERSARY TO ME!

Remarkable Retail: How to Win & Keep Customers in the Age of Disruption turned five this week. I didn't know then how much the next five years would test every idea in it.

A pandemic. Accelerated digital adoption. A wave of bankruptcies and store closings that at one point would have seemed unthinkable.

And through it all, the pattern held: the retailers who acted are mostly still standing. The ones who nodded along and kept swimming in a sea of sameness aren’t or are struggling mightily.

Being remarkable isn't a campaign. It's not a reorg. It's not a new app. It's a relentless commitment to being worth the trip (physical or digital) in a world that's constantly asking why you exist.

Five years in, that question is only getting harder to dodge.

I’m grateful for everyone who read it, argued with it, shared it, or put it to work. The conversation has been the best part.

Denial is a Hell of a Drug

“Among the dinosaurs there were many asteroid deniers.”

- Dave Pell

I’ve spent the better part of the last decade writing and speaking about disruption — first in Remarkable Retail and then in Leaders Leap.

If there is one thread running through virtually every cautionary tale I tell, it’s this: the leaders who end up presiding over endless struggle—or an actual extinction event— rarely lacked the information they needed to act.

What they lacked was the willingness to believe it.

Drifting into the Zone of Irrelevance

The zone of irrelevance is the competitive purgatory that sits between being a viable player and being gone.

It’s not bankruptcy. It’s not crisis — at least not yet. It’s the slow, grinding condition of no longer being meaningfully differentiated, no longer being truly necessary to your customer, no longer being remarkable enough to earn attention in a world drowning in choices.

What makes it so dangerous is that it doesn’t feel like an emergency. Sales are declining, but not catastrophically. Foot traffic is softening, but there are explanations. Market share is eroding gradually enough that each quarter’s loss feels manageable.

The lights are still on. The stores are still open. And yet the ground has been shifting under your feet for years.

The zone of irrelevance is far easier to enter than to exit. By the time most organizations recognize they’re in it, they’ve already depleted the two things they need most to get out: capital and credibility. The transformation that would have been expensive and disruptive five years ago is now nearly impossible.

It’s not hard to think of once vibrant retailers that find themselves precisely in this situation today.

When you find yourself in the zone of irrelevance customers aren’t angry — they’re indifferent. And indifference is harder to reverse than dissatisfaction. An unhappy customer can be won back. A customer who simply stopped thinking about you is a different problem entirely.

The zone doesn’t announce itself. You drift into it slowly, through a hundred small decisions to hold course, until one day the capital is gone, the credibility is gone, and the customer has moved on.

In a world of radical abundance — where customers have infinite choice, perfect information, and zero patience for the merely average — the zone of irrelevance is no longer a way station. It’s a one-way door.

The Unholy Trinity: Ignorance, Ego, and Fear

Ignorance, ego, and fear often conspire to drive us into a state of denial.

Ignorance is the starting condition. Before the era of digital disruption, a fair amount of ignorance and lack of urgency was understandable. Today, it is both inexcusable and dangerous. The failure isn’t that leaders can’t access the information. It’s that too many take too narrow a view, fish in the wrong places, or simply haven’t done the hard, uncomfortable work of exploring the perimeters of their ignorance.

Ego is what makes ignorance so hard to correct. Nothing can be built on solid ground until the ego is dealt with first. An exaggerated sense of one’s judgment, an unwillingness to ask for help, a relentless attachment to being right—these feed confirmation bias and the Dunning-Kruger effect in equal measure.

Fear closes the trap. Evolutionary biology has hardwired caution into our nervous systems. The amygdala's fight-flight-freeze response is enormously useful when a bear is charging at you, and deeply unhelpful when navigating organizational change. Fear produces transformation programs designed to minimize visible, attributable risk while systematically ignoring the invisible, often devastating risk of standing still.

Ignorance creates the opening, ego prevents the correction, fear cements the inaction.

The Warm Embrace of Denial

The iceberg, the asteroid, the disruptive new competitor, the game-changing technology — all of it was visible on the horizon.

But denial is a hell of a drug.

It soothes. It rationalizes. It makes the status quo feel reasonable and the alarm bells feel overblown.

And by the time the high wears off, the window for action has usually closed.

Irrelevance is rarely what happens to us.

It’s a choice — made slowly, incrementally, and usually with the best of intentions.

But the reckoning always comes.

Gradually. Then suddenly.

QUICK-ISH HITS

Nike: Just Not Doing It

The first thing you see on Nike’s investor relations homepage, in huge letters, is “Nike is a growth company.” (HT: Ed Elson, in Prof G Markets).

Meanwhile, revenue has declined every quarter for more than a year. Net income is down 35%. China, 15% of global revenue, is set to fall another 20% next quarter. Nike’s market value has collapsed from nearly $300 billion in 2021 to $65 billion today and the company is now worth a third of TJ Maxx!

Talk about denial.

The financials tell a sad story, but Nike’s deeper problem is an identity crisis.

Nike hasn’t accepted what it actually is: a mature but still powerful global brand that needs to be managed like one, not pitched like a growth story nobody believes anymore.

The company spent years aggressively pulling back from wholesale to chase a direct-to-consumer model. But they never built a robust and compelling network of their own stores and they misread the so-called great e-commerce acceleration and abandoned many retail partners only to overshoot the size of the digital opportunity.

At the same time, Nike coasted on franchise silhouettes — Dunks, Air Force 1s, Jordan 1s — while On Running and Hoka quietly took over performance running, the very category where Nike built its name.

The marketing drift makes it worse. Nike once set the cultural agenda — Just Do It, Michael Jordan, Kaepernick. Campaigns that made you feel something. Now they feel scattered. A brand that used to lead the conversation has started to follow it.

The Swoosh still means something. That’s real. But brand equity doesn’t survive denial indefinitely. Nike is a company living off the interest of past greatness while the principal slowly erodes.

At a recent all-hands, CEO Elliott Hill told employees: "I'm so tired, and I know you are too, of talking about fixing this business. I want to move from fixing…I want to move to building. I want to move to inspiring and driving growth and having fun."

Somewhere, surely, there's an iconic mantra for exactly this situation.

Two Bankruptcies Walk Into a Bar...

Bed Bath & Beyond is acquiring The Container Store, along with its owned brands Elfa and Closet Works, for $150 million in what seems like a coalition of the restructured, or perhaps a journey into the land of misfit brands.

Rather than reopening standalone Bed Bath & Beyond stores, the company is folding its brand into Container Store’s 100-plus locations, co-branding them as “The Container Store / Bed Bath & Beyond” — which may be the Ruth’s Chris or First Third Bank of retail concept monikers.

CEO Marcus Lemonis calls it an “Everything Home” ecosystem. More like a dog’s breakfast.

Desperation is not a differentiator.

Awhile back a friend of mine and I had fun coming up with a potential cure for Bed, Bath & Beyond’s ills. Maybe they should lean into the digitally native vertical brand trend and get super-focused by reinventing the hanger category?

If anyone has Marcus’ contact info…

Saks-cess

Saks Global has secured $500 million in exit financing from its senior secured bondholders, with a summer emergence from Chapter 11 the target. The mechanics are becoming clear even if the endgame isn’t. Secured lenders get the company; unsecured creditors — including vendors owed money from before the January 13 filing — will most likely see very little. That part was never really in doubt.

The operational story is becoming more encouraging. CEO Geoffroy van Raemdonck has steadied the ship in ways the pre-Chapter 11 chaos never allowed, with over 650 brand partners back to shipping and 90% of expected Q1 inventory flowing. That’s not nothing.

The footprint coming out the other side will be leaner, as I’ve argued it needed to be. Nearly the entire Off 5th chain is gone. Two dozen Saks Fifth Avenue and Neiman Marcus locations are closing. Bergdorf, sensibly, stays in the fold — at least for now.

Getting out of bankruptcy was never the real question. The harder question is whether a leaner, debt-lighter Saks can make the investments required to stay genuinely relevant in a luxury market that has shifted considerably. And whether it can do it fast enough to satisfy new owners who will eventually want their own exit.

ON THE POD

Stitch Fix CEO Matt Baer joins us live from Shoptalk to break down the company's turnaround strategy. He explains why real personalization is about relevance and timing — not just data — and how Stitch Fix is blending AI with human stylists to make fashion feel personal again. Four straight quarters of improving revenue suggest it's working.

Listen here or watch on our YouTube channel.

THREE OTHER IDEAS FROM ME THIS WEEK

Book a 1:1 Advisory Call. I’m now on Intro.co for focused, high-impact sessions. Secure time here.

Bring Me to Your Next Event. I’ve delivered keynotes at industry conferences on six continents and spoken at corporate events, customer dinners, and book signings around the world. Reach out at events@sageberryconsulting.com.

Buy a book. Remarkable Retail is the best-selling, highest rated, retail strategy book of the past decade. Leaders Leap will help you navigate the choppy waters of disruption.

Your Mediocrity Is My Opportunity

“Your margin is my opportunity.”

- Jeff Bezos

It’s a great line. Pithy, provocative, and endlessly quoted at strategy off-sites.

And yet it’s not at all clear that this was ever terribly useful advice.

But it’s most definitely hard to square with Amazon’s current big push into the famously low-margin grocery business.

Cool Story. Wrong Lesson.

If your entire theory of retail disruption is “find the fat margins and attack them,” you’re going to run into some trouble fast.

Walk up to Hermès and announce that their handbag margins are your opportunity. See how that goes.

Apple’s smartphone margins are eye-watering — has that made them easy to disrupt?

Oh the irony.

Margin is a data point and a consideration, but it is not a strategy.

What actually determines whether a category is ripe for disruption is something different, far more telling, and deceptively simple: the gap between what customers truly value and what they are getting.

Borders, Blockbuster, and Circuit City didn’t get sent to the retail graveyard because of some margin structure issue. They stopped being relevant in the face of new competition.

JCPenney is an equally instructive cautionary tale. When Ron Johnson tried to fix the margin problem by eliminating coupons, he discovered there was nothing underneath. Customers weren’t loyal to the experience. They were loyal to the discount.

And then there’s Bed Bath & Beyond and it’s store experience that had become exhausting long before anyone pulled the plug. Cluttered aisles, endless coupons that trained customers to never pay full price, a private label pivot nobody asked for, an e-commerce strategy perpetually two years behind. Nobody disrupted them. They disrupted themselves.

The sectors that have been genuinely revolutionized—the retail category leaders put in a tailspin or well down the road to irrelevance — didn’t simply fall because their margins were there for the taking. They fell because they let a gap emerge between what customers wanted and what they delivered.

And that gap? It’s a call to action for those prepared to leap.

As just one example: Warby Parker isn’t winning simply because Luxottica’s margins were high. They’re disrupting the eyewear business because buying glasses was genuinely terrible — confusing, overpriced, joyless — and Warby made it easy, transparent, and even a little fun.

Which points to two distinct opportunities — one defensive, one offensive.

The Call Is Coming from Inside the House

The retail brands that have failed—or sunk into the zone of irrelevance—were not, for the most part, victims.

Here's the uncomfortable truth those examples point to: these brands weren't ambushed. They watched the last two decades happen to them.

For most of the twentieth century, scarcity protected a lot of pretty run-of-the mill retailers. You could be decent, serviceable, a bit above average, and still survive because your customer didn’t have many readily accessible alternatives.

Those days are gone. We live in a world of radical abundance, where consumers have nearly infinite choice and perfect information, where whatever they want is available 24/7 from virtually anywhere.

When that’s the reality, merely being pretty good risks being close to invisible.

The retailers thriving today aren’t winning because they mastered the basics. They’re winning because they committed to being genuinely remarkable—intensely relevant, highly differentiated, emotionally connecting, and truly memorable—in the moments that matter.

These aren’t abstract aspirations. They’re the price of admission in a world where you’re no longer competing with the store down the street. You’re competing with the universe.

Every gap in your experience, every moment of indifference, every minute spent or dollar invested delivering a slightly better version of mediocre? That’s an opening you created.

Don’t hand your competitors the keys.

Always on Offense

Your mediocrity is your vulnerability. But your competitor’s lack of remarkability? That’s your invitation.

Find that gap. Widen it. Make it yours.

Some will tell you to “start with why.” I say start with wow.

But wow isn’t a vibe or a mood board. It’s a specific thing, and it’s worth being precise about what it requires.

To find your wow, you have to go deep on customer understanding to discover their evolving needs, their unmet desires, the emotional dimensions of what they’re really searching for. You’re not just looking for pain points to smooth away. Fixing friction is table stakes.

The harder and more important job is finding where you can genuinely amplify delight; the things that are intensely customer-relevant, proprietary to your brand, and remarkable in the original sense of the word: worth remarking on, worth telling someone about, the kind of experience that spreads.

At the heart of this is accepting a simple truth: No customer wants to be average. More importantly, no customer has to be be.

The brands winning today know this in their bones. They treat different customers differently. They show up in the moments that matter in ways personal enough to feel made for that specific person. That’s not a marketing strategy. That’s the product.

Here’s the catch. That wow factor has a shelf life, and it’s shorter than you think.

What’s remarkable today becomes expected tomorrow, then required, then meaningless. Former advantages can disappear faster than ever before.

Playing offense isn’t a project. It’s a posture, one you maintain continuously, because your customers are continuously raising the bar.

The moment you plant your flag and declare victory is the moment the ground starts shifting under your feet.

Eschew mediocrity.

Choose remarkable.

And then go, go, go.

RULES FOR (RETAIL) RADICALS

#5: Beige Won’t Save You

Every year, Pantone picks a Color of the Year.

Viva Magenta. Living Coral. Radiant Orchid. Bold, unexpected, impossible to ignore.

Every year, the most purchased paint colors are some shade of white, gray, or beige.

That gap tells you everything you need to know about the difference between what gets talked about and what gets chosen out of fear.

In retail, beige is the safe promotion, the predictable layout, the assortment that offends no one and thrills no one.

Beige is the 20%-off coupon you’ve mailed so long that customers won’t buy at full price anymore. Beige is the experience that ticks every box but leaves no mark.

Beige gets you forgotten. Not hated — just overwhelming indifference.

As Seth Godin saw coming decades ago: in a crowded marketplace, the purple cow — the thing that’s genuinely, arrestingly different — isn’t a gimmick. It’s the only strategy worth chasing.

We’re all waiting for the story you write next.

Just make sure it doesn’t look like this.

QUICK HITS

Pet.Com: The Sequel?

Here’s what I wrote about the cash incineration (and insane valuations) of many so-called digitally native vertical brands more than five years ago.

“It’s hard to say when the crazed spending will end, but eventually it will, because losses have a limit. Soon this retail generation will have its own Pets.com. In fact, probably quite a few of them. Who knows? Maybe we will soon be talking about a disruptor apocalypse. Maybe WeWork was the canary in the coal mine?”

As it turns out the image of a cute dog holding a microphone has given way to that of a once high flying bird. Earlier this week Allbirds—once worth over $4 billion— agreed to sell all of its assets and intellectual property to American Exchange Group for $39 million.

Allbirds isn’t just a story about a failed company. It’s a story about the difference between a brand and a business. Allbirds had a genuinely interesting product and real cultural cachet. But cool isn’t the same as viable unit economics.

The lesson isn’t that digitally native brands can’t win. It’s that customer acquisition costs and lifetime value matter more than your Series C valuation.

The founders who internalize that lesson now, before the runway runs out, are the ones who might actually build something lasting.

The Race to the Doorstep

Last week Amazon made another move in the convenience wars — customers in a growing number of cities can now get 90,000+ products delivered in three hours or less.

FedEx launched same-day service through a partnership with last-mile operator OneRail. Walmart is dropping packages from drones. Foot Locker — Foot Locker — is delivering sneakers through DoorDash. Target already reaches 80% of the U.S. population with same-day options via Shipt.

We are in a full-blown race to the doorstep. And the finish line keeps moving.

This was, frankly, predictable. In my 2026 predictions I flagged the continued concentration of power among a very small number of mega-retailers. This is what that looks like in practice.

Amazon and Walmart have the logistics infrastructure, the store footprints, and the capital to keep raising the bar. Everyone else scrambles to keep up, which is exactly why the third-party ecosystems of DoorDash, OneRail, and Instacart are having such a moment. They’re selling access to speed that most retailers couldn’t build themselves.

The conventional wisdom used to be: fast, free, reliable — pick two. That tradeoff has collapsed. Amazon spent years training customers to expect two-day delivery, then next-day, then same-day. The market always adjusts to whatever the leader normalizes. One-hour delivery isn’t a premium novelty. It’s a preview of the baseline.

But here’s the thing: faster delivery only wins if what you’re delivering is worth wanting. The retailers who thrive won’t just be the ones who can get a package to your door in 60 minutes. They’ll be the ones who give you a reason to order it in the first place.

Speed is increasingly necessary. But it is not sufficient.

It’s the End of the Mall As We Know It…And I Feel Fine

Recently The Real Deal offered up this take on malls. The Wall Street Journal, in noting David Simon’s unfortunate passing, highlighted what the Simon Property Group CEO saw that many others didn’t.

Here’s what I wrote about malls in early 2021 in the 2nd edition of Remarkable Retail:

“..the apocalyptic vision some forecasters paint should be parsed more finely. Assuming a substantial retail recovery from the pandemic by the end of 2021, most high-end malls will likely continue to perform well over the longer term with an approach that does not stray terribly far from the familiar.”

I don’t have the gift of prophecy. What I do have, to paraphrase Liam Neeson, is a very particular set of skills. Skills that make me a nightmare to people who get sucked into lazy and dangerous click-bait stories.

The mall-is-dead narrative was always more compelling as a headline than as analysis. The truth was messier and more interesting: bad malls were dying, good malls were adapting, and the difference had everything to do with delivering a remarkable experience and nothing inherently to do with the format.

That's still true today. Just look at the diverging fortunes of any top Simon mall (and quite a few owned and operated by others) versus the dead-mall Pinterest boards.

Fact are stubborn things.

ON THE POD

On this week’s episode of the Remarkable Retail Podcast our guest is Bret Taylor, OpenAI Board Chair, Sierra co-founder, and former co-CEO at Salesforce, recorded live on stage at Shoptalk.

Bret and I explore the rapid evolution of how customers search, discover, and buy, whether AI is becoming the new front door to the store, and a whole lot more.

Neil Saunders, one of retail’s top thought leaders, also served as guest co-host, dropping keen insights on the most interesting retail stories of the week.

Listen here or watch on our YouTube channel.

“Alison, Can You Explain What Internet Is?”

January 24, 1994. Bryant Gumbel leans over his Today show desk and squints at a piece of paper. “What is internet, anyway?”

Katie Couric doesn’t help much. Someone off-camera ventures a guess. Gumbel stumbles over the @ symbol. The whole thing lasts about forty-five seconds.

Forty-five seconds of television history. Not because of what they said. Because of what they couldn’t see.

They weren’t close to grasping something about to reorganize every industry, every institution, every power structure on the planet — and to them it was a curiosity. A syntax question. Maybe filler before the weather.

We watch that clip today and feel smug. How could they not have known?

Here's the harder question: what are we not seeing right now?

Nobody Sees It at First

Every profound shift produces its Bryant Gumbel moment. Leaders who are competent, deeply credentialed, but unable to see it.

This isn’t stupidity. It’s often the trap of mastery.

You rise to the top by learning the rules. By executing brilliantly inside the current frame. Precision, efficiency, optimization — all rewarded.

And then the frame changes.

Not gradually. Suddenly. Explosively.

All that mastery becomes a liability. Your pattern recognition — your greatest asset — starts firing on the wrong patterns. You see disruption coming and file it under “manageable transition.”

But here’s the thing: The disruption curve doesn’t care about your track record. It doesn’t grade on tenure.

Which brings us to the thing that many executives think they already understand.

“You’ve Got AI”

If you’re of a certain age you probably remember when AOL’s “You’ve Got Mail” felt like the internet. A friendly chime, a message in your inbox.

Millions of people had touched the surface of something vast — and mistaken it for the whole thing.

Most executives are in exactly that position with AI right now.

They’ve run the pilots. They’ve seen the demos. Someone on their team uses it for first drafts and meeting summaries. They think they’ve arrived.

They haven’t.

Here’s what’s actually happening. AI is no longer a tool you use. It is an agent that acts.

Generative AI responds when you prompt it. Agentic AI is given a goal — then breaks it into tasks, executes across systems, evaluates results, course-corrects, and delivers. Without a human in the loop.

It doesn't wait. It plans. It acts. It iterates. At a speed and scale no human team can match.

You’re not automating a task. You’re deploying a colleague — a trusted expert with nearly infinite skills who never sleeps.

That is not an incremental improvement. That is a restructuring of what organizations are for, how work gets done, and how the fundamentals of shopping happen.

For retailers especially: this isn’t a back-office efficiency story. It’s a front-of-house transformation. The way customers discover, evaluate, and buy is changing underneath you — not eventually, now.

Navigating at the Speed of Disruption

The internet took roughly a decade to go from “what is this?” to “I cannot run my business without this.” Executives had ten messy years to watch, learn, and adapt. Most still got it wrong. But the window was at least open.

Agentic AI is not giving you a decade.

The disruption curve has a compounding property most leaders underestimate — not from lack of intelligence, but because our brains are wired for linear extrapolation.

We look at today’s rate of change and project it forward at roughly the same pace. But that’s not how exponential change works. New technology gets released and adopted faster and faster all the time. The distance between “interesting novelty” and “table stakes” keeps shrinking.

The uncomfortable truth: you will likely experience more disruption in the next two or three years than in the past ten.

Act accordingly.

Go Unstuck Yourself

Bryant Gumbel had an excuse.

He was live on television in 1994, holding a piece of paper with an @ symbol on it, with no one in his earpiece who actually knew what it meant.

You don't have that excuse.

The information is available. The window is open.

The only question is whether you're going to use it before it closes.

RULES FOR (RETAIL) RADICALS

#4: Edit to Amplify

Here’s a trap I see retailers fall into. Over and over.

They confuse more with better.

More products. More promotions. More messages. More everything.

The logic feels sound: cast a wider net, catch more fish.

But in a world of staggering abundance — where customers are bombarded by weapons of mass distraction and have zero need, much less patience, for the merely average — more is often the enemy of remarkable.

Barry Schwartz nailed it: more choice doesn’t liberate customers. It paralyzes them.

Editing to amplify means making deliberate choices about what to cut so what remains hits harder.

Stop chasing the promiscuous shopper. Stop trying to be everything to everyone — because that strategy ends in being nothing to anyone.

Look at the brands that consistently win. Costco. Trader Joe’s. Apple. They thrive not despite their constraints but because of them. Their simplicity isn’t an accident. It’s a choice.

There is a lot of clutter out there. To become a compelling signal amid all the noise, you must do something remarkable enough to earn attention — not just buy it.

That doesn’t happen by adding more. It happens by editing until what’s left is intensely relevant and genuinely worth talking about.

Narrow your aim. Simplify the offering. Eliminate the cruft. Boost the signal.

The question isn't what to add next. It's what you're finally willing to cut.

ON THE REMARKABLE RETAIL PODCAST

On this week’s episode of the Remarkable Retail Podcast our guest in Jennifer Woo, Chariman & CEO of Lane Crawford, the iconic Hong Kong based retailer.

Listen here or watch on our YouTube channel.

DEPARTMENT OF HUMBLE BRAGS

I’m honored to be included in Thinkers360’s 2026 list of Top 50 Global Thought Leaders on Leadership. You can see the full list here.

THREE OTHER IDEAS FROM ME THIS WEEK

1. Schedule a high impact video consultation with me.

2. Bring me into your company or to your next event to speak.

3. Buy a book. Remarkable Retail is the best-selling, highest rated retail strategy book of the best decade. Leaders Leap will help you navigate the choppy waters of disruption. They are both available in hardcover, as an e-book, and on Audible.

Learning to Surf

Shift Happens

Nearly six years ago, in my first book, I mapped the forces reshaping retail: the shift from siloed to cross-channel experiences, from going online to living online, from brand control to consumer empowerment, etc.

I argued most organizations weren’t moving fast enough.

I warned disruption would accelerate in ways both predictable and blindsiding.

I was right. And it’s only gotten wilder ever since.

Waves of Disruption

Since Remarkable Retail was released, the landscape has been hit by wave after wave.

Temu and Shein went from footnotes to tens of billions in revenue.

The pandemic torched global supply chains and turbo-charged everything digital.

Social and creator commerce exploded. TikTok Shops arrived on the scene.

Generative AI began rewiring how work gets done across the entire retail value chain.

Retail media networks quietly became serious profit contributors.

And agentic commerce — still early — threatens to completely reset search, discovery, and the customer relationship itself.

And we’re not done. Not even close.

“The future is already here. It’s just not evenly distributed.”

- William Gibson

My Name is VUCA

VUCA — Volatility, Uncertainty, Complexity, Ambiguity — started as a U.S. Army framework for the post-Cold War world.

It’s now the most honest description of what the context for formulating retail strategy actually feels like.

Each letter in the acronym hits differently.

Volatility is the speed of change. Uncertainty is how little you can predict. Complexity is how tangled cause and effect have become. Ambiguity is when the signals are too murky to even frame the problem clearly.

The instinctive response — more planning, more forecasting, more optimization — is understandable. And often useless.

“Everybody has a plan until they get punched in the mouth.”

- Mike Tyson

Here’s the reframe: each letter also points to a required action.

• Volatility demands a more compelling vision

• Uncertainty demands deeper understanding — of customers, competitors, technology, and macro-economic forces

• Complexity demands ruthless clarity in strategy and execution

• Ambiguity demands an agile business model that can adapt as the ground shifts.

Learning to Surf

“You can’t stop the waves, but you can learn to surf.”

- Jon Kabat-Zinn

The waves of disruption aren’t coming—they’re already here. And the next set is forming behind them, coming at us faster and higher.

Most leaders spend their energy bracing for impact. That's the wrong game entirely.

We must stop hoping that things will stabilize, accept that change is constant, and develop the courage and agility to ride whatever wave comes next.

If you’re going to avoid wiping out versus reading the break, you must learn to surf.

You’re not powerless against the waves.

You choose which oceans you swim in. You choose your board. You choose when to paddle out.

Most importantly, you choose how relentlessly you work at getting better at surfing the inevitable waves.

RULES FOR (RETAIL) RADICALS

#3: Open the Aperture

“Man cannot discover new oceans unless he has the courage to lose sight of the shore.”

- Andre Gide

Tape that to your monitor.

Read it before every strategy meeting.

In my experience, the single greatest innovation killer isn’t bad ideas. It isn’t lack of capital. It isn’t even the much-maligned “culture problem,” though that’s real enough.

It’s the desperate, white-knuckled grip on the shore.

Most organizations say they want to innovate. They put it in the annual report. They hire a Chief Innovation Officer, stand up a skunkworks lab, send a delegation to NRF or SXSW. They come home. They do almost nothing — or worse, they do the smallest, safest version of something and call it transformation.

The problem isn’t intelligence or intention. It’s a failure of imagination; an unwillingness to reframe the playing field entirely.

Leaders are scanning for threats within their existing field of vision — optimizing what they already have — while the real disruption forms just outside the frame.

Opening the aperture means something specific. It means widening your field of vision deliberately — across categories, industries, and customer behaviors that don’t yet show up cleanly in your data. Asking not “how do we do this better?” but “what if the whole model is wrong?”

That’s uncomfortable. And organizations are not wired for it. The quarterly cadence, the budget cycle, the org chart itself — all of it conspires to keep you anchored, optimizing the existing business while the world moves on.

You can’t find new lands by hugging the coastline. You find them by pointing the ship into open water and accepting that discomfort is the price of discovery.

So here’s the question worth sitting with:

What are you refusing to look at because it’s too far outside your current frame?

New lands are out there.

The only variable is whether you’re willing to sail far enough to find them.

ON THE REMARKABLE RETAIL PODCAST

On this week’s episode of the Remarkable Retail Podcast Barnes & Noble CEO James Daunt is our guest. And, as it turns out, reports of physical book stores’ death are greatly exaggerated.

Listen here or watch on our YouTube channel.

WHERE IN THE WORLD IS STEVE?

Next week is the 10th anniversary edition of Shoptalk in Las Vegas and I’ll be on stage twice, in addition to recording episodes of the pod.

First up is my conversation with Bret Taylor, former Salesforce co-CEO, current OpenAI Board Chair, and the founder and CEO of agentic commerce start-up Sierra, We’ll be sorting agentic reality from the hype. It’s at noon on Tuesday March 24.

Later that day I’ll be participating in the debut version of “The Retail Rumble” where four fast-paced debates on the most pressing topics facing retail will be held. If you’re ar the show this is a can’t miss event!

IF MY WORK RESONATES . . .

…and you want to take our relationship to the next level, here are 3 ideas:

BOOK AN ADVISORY VIDEO CALL. I’m now live on Intro.co for 1:1 concise and high impact advisory calls. Secure time here.

BRING ME TO YOUR NEXT EVENT TO SPEAK. I’ve delivered inspiring keynotes at industry conferences on six continents and been a featured speaker at dozens of corporate events, customer dinners, book signings, and more. Reach out to events@sageberryconsulting.com for all the details.

BUY REMARKABLE RETAIL: How to Win & Keep Customers in the Age of Disruption. For a limited time it’s more than 50% off on Amazon.

The Algebra of Retail (Part 1)

Retail success or failure is rarely a strategic mystery—or a random occurrence. To a large degree, it’s an arithmetic inevitability.

I’ll apologize in advance: there will be math. But not in the way you might fear.

What I’m really talking about is understanding relationships—how key variables interact, constrain, and reveal each other. Because when you know what drives the numbers, you know what drives the business.

This is the first in a series exploring the algebra of modern retail. There won’t be much literal algebra—I’ll spare you that. But what I will do is lay out the equations, ratios, and critical relationships that, in my experience, separate operators who react from those who anticipate.

If you want to know why you’re winning, losing, or stuck—the math already knows.

Let’s go find it.

The Sales Throughput Formula

Sales growth comes down to five levers. Most retailers know them. Few actually optimize them.

• Traffic — unique visitors, in-store or online

• Conversion Rate — % of visitors who buy

• Average Unit Retail (AUR) — average selling price per item

• Units Per Transaction (UPT) — basket size

• Purchase Frequency — how many times a customer buys in a year

Multiply these together and you have your revenue. Miss on any one of them and you’re leaving money on the table.

The problem usually isn’t awareness. The problem is execution — and it breaks down in three predictable ways.

1. If you don’t understand why customers buy (or don’t), you can’t know which lever to pull. You end up with dashboards full of data and a team full of hypotheses, but no conviction. You admire the problem instead of solving it.

2. They analyze at the wrong altitude. Aggregate metrics lie. A healthy average conversion rate can mask a collapsing segment. You must break every part of this equation down by customer type, segment value, and purchase occasion — because the right move for a loyal, high-frequency buyer is almost the opposite of the right move for someone who’s never converted. Market aggressively to the wrong group and you’ve wasted budget. Ignore the right group and you’ve left a relationship on the table.

3. They optimize channels in isolation — and destroy value in the process. For many customers, the website isn’t the destination. It’s the on-ramp. When you chase e-commerce conversion metrics without accounting for what happens in-store, you make your digital team look good while total revenue flatlines.

The reverse trap is just as costly: a store traffic spike with no sales bump isn’t automatically a failure (see Walmart). Returns, BOPIS, service visits — these interactions build purchase frequency and NPS, two variables with compounding returns that single-channel attribution will never capture. Punish the store for that traffic and you’ve optimized the metric while undermining the business.

The channel isn’t the unit of analysis. The customer journey is.

Ultimately the sales throughput formula is deceptively simple.

The discipline to run it right is not.

ANVB > DNVB

A decade ago, a thesis took hold: powerful, valuable brands could be built by going online-only and being vertically integrated. Venture capital poured into dozens of digitally native vertical brand (DNVB) startups. Think Allbirds, Bonobos, Casper.

It hasn’t gone well. Valuations are down 90%+ from peak. Growth has stalled. Profits remain elusive or nonexistent for most.

The reasons are straightforward in hindsight. DNVBs mistook a favorable ad environment for a business model. Physical stores turned out to be a necessity, not a luxury. The flywheel never spun — customer acquisition costs kept climbing while niche products struggled against entrenched incumbents. The “brand moat” proved to be a puddle.

Here’s the uncomfortable truth: none of this was actually innovative. Mono-brand retail has existed for decades. Going direct-to-consumer — whether through mail-order catalogs or owned stores — isn’t new. These founders, and the VCs who bankrolled them, essentially rediscovered vertical retail and called it a revolution. Lighting that much cash on fire was, admittedly, novel.

Walk any upscale mall today. You’ll spot a handful of DNVB survivors like Warby Parker or Untuckit. But they’re vastly outnumbered by what I call analog native vertical brands — ANVBs.

The OG catalog brands: J. Crew, Patagonia, Banana Republic, Lands’ End. The luxury stalwarts: Louis Vuitton, Gucci, Ralph Lauren, Coach. The newer wave: Vuori, Alo Yoga, Yeti, Tecovas. The ubiquitous mono-brands — Gap, H&M, American Eagle — that nobody thinks to compare to Away or Glossier, but probably should. And the giants — Nike, Lululemon, Levi’s, The North Face — with massive owned-store footprints built long before “DTC” became a buzzword.

The lesson is simple: there’s nothing inherently superior about being digitally native. Vertically integrated retail has always worked when done well. The winners have long been those who master the mix — e-commerce and physical, direct and wholesale — not those who fetishize one channel as a strategy.

Safe = Risky

There’s a story retailers tell themselves when they choose not to make the bold move — when they pour time, attention, and precious capital into an infinite loop of incremental improvements. When they choose slow and steady, or making a remarkable leap.

It feels prudent. It feels responsible.

It isn’t.

The retail graveyard isn’t filled with brands that swung big and missed. It’s filled with brands that played it safe — one cautious quarterly decision at a time.

Sears didn’t blow itself up. It optimized its way into irrelevance. Macy’s, JC Penney, and Kohl’s had twenty years of off-ramps — two full decades — to design, test, and roll out a format that could compete with the specialty retailers and off-price players eating their lunch.

None of them took it.

Now they’re fighting for survival with neither the capital nor the credibility to do what it would actually take. The window has closed.

The category killers that ruled the ‘80s and ‘90s? Mostly gone (Circuit City, Linens & Things, Borders) or hollowed-out shells (Toys R Us, Bed Bath & Beyond, every office supply chain). The companies that treated caution as a strategy paid the price — slowly, then all at once.

But look at the counterexamples.

Dick’s Sporting Goods didn’t wait to be disrupted. They reinvented their core format with House of Sport — experiential, destination-worthy, genuinely differentiated.

RH was on a road to nowhere with its small-format, land-of-misfit-toys concept until it blew that up entirely and reimagined itself as a luxury home furnishings destination through its Gallery stores.

Here’s what most boardrooms get wrong about risk: they only see one kind.

The risk of doing something bold and failing. That risk is visible. It’s attributable. It can end careers. So it gets all the scrutiny, all the debate, all the caution.

What goes unexamined — until it’s too late — is the other risk. The risk of failing to act. Of missing the moment so gradually that no one sounds the alarm until the shore is long out of sight.

The companies that survive disruption aren’t reckless. But they understand something their competitors don’t: caution has a price tag too. It just arrives later — and usually all at once.

The most dangerous thing you can do right now isn’t to take a big bet.

It’s to convince yourself that not taking one is safe.

I’ll be back with Part 2 of the Algebra of Retail in a couple of weeks.

RULES FOR (RETAIL) RADICALS

Each edition I’ll be suggesting some rules for retail radicals to encourage you to make the leaps you must and help accelerate your journey to remarkable results.

#2: Start Before You’re Ready

“It’s a terrible thing, I think, in life to wait until you’re ready. I have this feeling now that actually no one is ever ready to do anything. There is almost no such thing as ready. There is only now. And you may as well do it now. Generally speaking, now is as good a time as any.”

- Hugh Laurie

We’re never ready for the work that actually matters.

The laundry, the commute, the inbox — sure, we’re ready for those. But the work that might actually change something? That’s different.

Challenging the status quo is frightening. Exposing a novel idea to potential ridicule is scary. And that fear is exactly what keeps us spinning — in analysis, in endless revisions, in “just one more round of feedback.”

We call it sensible preparation. It’s merely garden variety avoidance in a blazer.

Getting started is rarely all-or-nothing.

It’s not about shipping sloppy work — it’s about getting imperfect work in front of real people sooner rather than later. The audience teaches you things no amount of internal deliberation ever will.

Scrappy beats stuck. Every single time.

“Perfectionism is the voice of the oppressor, the enemy of the people. It will keep you cramped and insane your whole life, and it is the main obstacle between you and a shitty first draft.”

- Anne Lamott

DIRE STRAIT

The Iran war continues to drive profound effects.

Some impacts are direct and obvious — escalating gasoline costs. Others, as The Atlantic’s Derek Thompson outlines, are the ripple effects. Before the conflict reached its second birthday, signs of disorder were everywhere: energy facilities under direct attack, production cuts across the region, Qatar declaring force majeure on LNG exports, governments across Asia scrambling with emergency fuel conservation measures.

A month ago, it didn’t occur to me that a ridiculously tight waterway on the other side of the globe could rattle the world at large — and the retail industry in particular. But here we are.

I won’t pretend to predict how fast or how far this trajectory runs. That’s well above my pay grade.

What I will say: beyond the very real and ongoing human tragedy, the volatility and uncertainty aren’t fading in days or weeks — even if traditional hostilities cool tomorrow.

DYING FOR SAKS

Saks Global’s Chapter 11 store consolidation is accelerating — and they’re not likely to be done quite yet.

The ax first fell in January with the closure of most off-price stores and the wind-down of their related e-commerce site. A few weeks later came the first wave of full-line closings: 8 Saks locations, 1 Neiman Marcus.

I said then they weren’t close to done. Last week’s announcement — another 15 stores added to the list — proved the point. The pattern holds: small markets, or Saks locations sitting in the shadow of a nearby Neiman’s.

Management suggested they’re mostly finished. I’m skeptical. Several overlapping locations remain unresolved — some literally sharing the same mall (Somerset Collection, Boca Raton, Bal Harbour, Houston Galleria), others uncomfortably close (Atlanta, Beverly Hills). Something still has to give.

The delay may reflect ongoing lease negotiations, with mall owners buying time to avoid a large dark anchor. Or it could signal that Saks Global is still gaming out brand repositioning options for their higher-volume overlap markets — a Saks converted to Men and Home, a pivot toward Nordstrom territory, maybe a Bergdorf conversion.

Interesting to think about. But long-term, I doubt most of these strategies will hold up. Which is why I expect another five or six closings before this is over.

ON THE POD

On a recent episode of the Remarkable Retail podcast we explored what far too many retailers still miss in their growth strategies.

Listen here, or watch on our YouTube channel.

From the Remarkable Retail Podcast Archives

Seth Godin joined us to explore the powerful question: Is work working?

IF MY WORK RESONATES . . .

…and you want to take our relationship to the next level, here are 3 ideas:

BOOK AN ADVISORY VIDEO CALL. I’m now live on Intro.co for 1:1 concise and high impact advisory calls. Secure time here.

BRING ME TO YOUR NEXT EVENT TO SPEAK. I’ve delivered inspiring keynotes at industry conferences on six continents and been a featured speaker at dozens of corporate events, customer dinners, book signings, and more. Reach out to events@sageberryconsulting.com

BUY REMARKABLE RETAIL: How to Win & Keep Customers in the Age of Disruption. For a limited time it’s more than 50% off on Amazon.

I’ve been criticized for what some see as my overuse of the term “bifurcation.”

Perhaps folks don’t realize that every time I say it an angel gets its wings.

In 2015 I first wrote about “retail’s great bifurcation” as I noticed that success was increasingly being found at either end of a spectrum.

At one end, were brands that offer wide assortments, great convenience, and low prices (think Walmart, Amazon, warehouse clubs, dollar stores, and off-price merchants).

At the other end, were retailers focused on a narrow, more upscale audience, delivering premium or truly luxurious products, high levels of customer service, and more emotionally connecting experiences (often rooted in strong storytelling).

Yet, disturbingly, most of those in the murky middle found themselves edging ever closer to the precipice or merely running to stand still.

In the decade since I first started writing and speaking about this phenomenon, retail bifurcation has only become more pronounced.

In fact, the majority of incremental retail growth in the United States is being captured by just three mega-scale, value-oriented retailers.

At the other extreme, well differentiated, highly relevant, but far smaller brands like Warby Parker, On Running, Sephora, Coach, et al, are posting strong same-store sales growth and opening many new stores.

For those retailers continuing to swim in a sea of sameness, they’ve been closing scores of stores, feverishly cutting costs, and seemingly praying that a slightly better version of mediocre will prove to be a winning strategy.

Narrator’s Voice: It won’t.

The K-Shaped Economy: It’s a Thing

If you’ve been paying attention, none of this is new. My friends at Deloitte also called out the “great retail bifurcation” many years ago.

More recent data from the National Retail Federation confirms that retail spending patterns are quite different depending upon your income levels.

The top 20% of consumers are now responsible for 60% of all spending, thereby masking the weak contribution from the majority of the population.

The Fork in the Road is Everywhere

Bifurcation is not simply limited to consumer spending patterns or particular type of retailer performance.

The perpetual narrative that malls are dying is better understood by seeing that lower quality centers are struggling, closing or being massively repurposed, but most top-tier malls are doing very well indeed.

As just one example, Simon Property Group, the largest operator of malls in North America, recently reported another strong quarter of revenue growth and occupancy rates that exceed 96%.

Our media habits are also bifurcated, as traditional media use plummets and digital exhibits robust growth.

In the stock market, returns have been overwhelmingly driven by the so-called Magnificent 7. All other names have mostly treaded water.

Those in political power like to say the job market is pretty solid. But the reality is it too is extremely bifurcated.

Same story when it comes to who is sharing in the spoils of a growing economy.

The Tyranny of “Average”

My friend and colleague Jason Goldberg likes to point out that, on average, Nepal is a flat country.

Which of course is technically true, but isn’t a super helpful observation if you’re planning a mountain climbing trip there.

On average, the consumer appears pretty resilient. But how does that help us if we serve far more specific audiences who are struggling to make ends meet?

On average, the stock market is doing really well, but if you own the wrong basket of equities or aren’t in the market at all (or very little), so what, who cares?

On average, thousands of stores continue to open every year—and sales through brick-and-mortar locations have been positive since 2009. But if your physical locations are poorly located, over-spaced, or full of undifferentiated, irrelevant merchandise, knowing that is small comfort indeed.

If we are going to succeed in a world that is changing very quickly, where moving beyond the general to the highly specific has never been more important, then we need to fight back against false or overly generalized narratives and eschew the tyranny of average.

And, most importantly, when you get to the fork in the road be sure to take it.

THIS WEEK IN CHUTZPAH

The New York Times published an interview with former Saks Global chairman Richard Baker and noted destroyer of department stores this week and it’s, um, something.

“I had 50,000 people working for 10 years longer than they would have. That’s more than a half a million work years. I kept each one of these businesses going longer than anyone on Earth ever could have.”

- Richard Baker

He reportedly is struggling to find a publisher for a memoir about his retail exploits.

Apparently no one is interested in a book with only one chapter: Chapter 11.

RULES FOR (RETAIL) RADICALS

Each week I’ll be suggesting some rules for retail radicals to help you accelerate your journey to remarkable results.

Here’s my inaugural rule:

ABT. A: Always. B: Be. T: Testing.

Folks often think that companies with a great innovation track record have created some magical process or perhaps are just incredibly lucky.

Nope.

What they have done is built a culture of experimentation. They know that reps matter, they are wired to say “yes” instead of “no,” they embrace the beauty of imperfection.

They also accept that quitting is underrated.

ON THE POD

This week Dan Frommer, iconic tech journalist and Founder of The New Consumer, joins us in the Narvar remote podcast studio at the NRF "Big Show" to unpack the consumer trends you need to know right here, right now.

Listen here, watch here, and drop us that 5-star rating and review!

From the Remarkable Retail Podcast Archives

Crate & Barrel CEO Janet Hayes joined us for an insight packed interview on driving growth at one of the top global home furnishing brands.

THREE OTHER IDEAS FROM ME THIS WEEK

1. Schedule a high impact video consultation with me.

2. Bring me into your company or to your next event to speak.

3. Buy a book. Remarkable Retail is the best-selling, highest rated retail strategy book of the best decade. Leaders Leap will help you navigate the choppy waters of disruption. They are both available in hardcover, as an e-book, and on Audible.

It’s a crisp fall day in 2002, and I’m enjoying my second cup of coffee in my office at Sears’s sprawling corporate campus outside of Chicago. The last eighteen months have been exhausting for me and my team, but on this particular morning I’m feeling pretty good.

The previous afternoon we had presented our long-term transformation plan to the Sears board of directors. Our recommendations were thorough and expansive, but we knew we might face resistance. Putting our plans into action would require billions of dollars in investment and many complicated and painful changes. If successful—and there were hardly any guarantees—it would take years to fully realize the benefits. To move from design and testing into comprehensive action, we needed the board’s full-throated assent.

We got it.

They were ready, they said, to do what had to be done. They would invest real money to recapture Sears’s promise and reboot the storied retailer, positioning it for a better future.

From a personal perspective, this felt like a huge achievement. The previous year, I had been promoted to vice president of corporate strategy and joined the company’s senior leadership team. I had several responsibilities, but by far the most important and vexing one was helping craft a turnaround strategy for Sears’s long-suffering department store business. Although Sears had once been the biggest, most valuable retailer on the planet (as you probably know), for more than a decade the company’s retail market share, competitive situation, and financial performance had declined dramatically.

The blows were coming from all sides—and had been for many years. Discount mass merchants like Walmart, Target, and Kohl’s were stealing away more value- and convenience-oriented customers. So-called category killers like Home Depot and Lowe’s in home improvement and Best Buy in appliances and consumer electronics had become formidable, rapidly expanding competitors. They were starting to erode Sears’s once overwhelmingly dominant (and highly profitable) market position. Our situation was growing increasingly dire.

This wasn’t Sears’s first attempt at a turnaround. Far from it. Multiple past leadership regimes had tried to return Sears to its glory days. They’d done some innovative things, including launching the high-profile “Softer Side of Sears” campaign in the mid-1990s and following that quickly with an early and quite substantial investment in e-commerce. Numerous specialty concepts that were not tethered to regional mall real estate had been piloted and expanded to varying degrees of success. Still, none were stemming what increasingly looked like a potential slow slide into oblivion for what was the first and, at the time, most famous “everything store.”

In late 2000, Alan Lacy was named Sears’s new CEO. He moved quickly to assemble a new leadership team, eventually appointing me to head up corporate strategy. Once again it was time to mount an attempt at a bold turnaround. So we dug into customer data and conducted extensive competitive analysis. With the assistance of a prominent strategy consulting firm, we executed many rounds of consumer research to understand what was most critical to the customers we desperately needed to win, grow, and retain.

As we got further into the process and learned much more about our opportunities and weaknesses, we began piloting multiple tracks across the company to experiment with new strategies. We consolidated and developed new private brands, created new marketing campaigns, and explored a comprehensive redesign of our store operating model, layout, and visual merchandising. All were aimed at dramatically improving customer relevance and driving greater profitability. We were onto something big—or so we thought.

It wasn’t all analysis and experimentation. A few months before we presented our longer-term vision, we’d written a check for nearly $2 billion to acquire Lands’ End, with the aim of enhancing our apparel and home businesses and accelerating our growing e-commerce and direct-to-consumer capabilities. A new big-box, “off-the-mall” concept called Sears Grand was being designed completely from the ground up and would open the next year.

It was an ambitious agenda, and my team had played an indispensable role. And now we had the board’s support to scale up our experiments and roll out the complete turnaround strategy. We’d done just about everything we’d originally set out to accomplish when I started in my new position. Having worked in strategy and innovation for the better part of my career, I know that pitching such an ambitious plan is not usually so successful, no matter how necessary one’s efforts might be.

But back to that fateful fall day. As I sat at my conference table basking in our success, I was suddenly jolted out of my self-congratulatory daydream when one of my direct reports poked his head into my office. John had played an essential role in the competitive and customer analysis, and he was also helping lead the development of our new concept store. He looked dismayed.

“What’s up?” I queried.

“I’ve been reflecting on the strategy we came up with,” he began. “I definitely think it really is the best we can do given the circumstances. But the more I think about it, it isn’t really a strategy to win. It’s just a strategy to suck less.”

I was perplexed. What was he talking about? Did he not remember all the fantastic work we had just completed? Did he not appreciate how hard it was to get the executive team’s alignment and ultimately secure the board’s support? We’d nailed this thing. We were going to be the saviors of Sears.

But then—slowly at first, and then all at once—a sinking feeling started to consume me.

Questions I had repressed or denied began to fill my head. Even if everything we had planned was flawlessly executed, were our actions bold enough to meaningfully differentiate ourselves from our competition? Could we possibly move fast enough to close the gap that had developed and widened because of our slowness to act for so very many years? Fundamentally, were we actually leaping to a new leadership position or essentially running to stand still?

My veil of denial began to part.

Shit.

John was right.

The above is an excerpt from the Introduction of my latest book Leaders Leap: Transforming Your Company at the Speed of Disruption.

It’s probably not news to you that since that fateful fall day Sears has gone from being a formidable, albeit troubled, retailer to essentially a non-entity. In fact, when I left the company about a year after our board presentation, it become increasingly and painfully obvious that Sears was beginning a slow, inexorable slide and moving ever closer to a one way trip to the retail graveyard.

It’s also likely not news to you that Sears is far from alone in being a once powerful, iconic brand that has fallen from lofty heights, whether inside retail (Bed, Bath, & Beyond, Blockbuster, Borders. Circuit City, Radio Shack, Toys R Us, Hudson’s Bay) or outside of it (AOL, Blackberry, Compaq, Gateway, Nokia, Palm, Oldsmobile).

Today it’s depressingly easy to think of companies that seem trapped in the zone of irrelevance and stuck in endless cycles of struggle. Department stores are perhaps the most notable, but there are plenty of other organizations that are members of this band of beleaguered brothers.

Every so often, and all too predictably, new strategies to remake these brands get launched to great fanfare.

For example, two years ago Macy’s announced “A Bold New Chapter.”

Similar efforts to reboot once successful retailers are underway at Kohls, JC Penney, Victoria’s Secret, and Starbucks–just to name a few.

And yet…

Despite it being blindingly obvious that the world has changed so very much, for the most part, these companies are actually changing very little.

These brands seem to believe that a slightly better version of what they’ve always done—”sucking less” to put it plainly, if inelegantly—will allow them to win back and retain valuable customers that have long since taken their business to far more remarkable retailers.

It’s time for them to break through their veil of denial.

Addressing known problems in your business is a necessary start, but it is far from sufficient.

Sucking less may close some important gaps, but it won’t leap you ahead of the competition.

Customers don’t shift their loyalties simply because you’ve made some relative progress between yourself and their new favorite retailers.

In fact, incremental progress often means you’re only falling behind the competition at a slower rate. The gap is likely still widening.

Meaningfully better execution of a fundamentally broken business model might buy you some valuable time.

But if think it will be your salvation, you just might want to think again.

Leaders leap. Losers creep.

MORE SAKS EDUCATION

The Second (Designer) Shoe Drops

Two weeks ago the first shoe dropped on Saks Global’s plans to take an ax to their store portfolio as they got the bankruptcy court’s approval to close the majority of their off-price stores and wind-down the related e-commerce site.

This week they got the go ahead on the shuttering of nine full-line stores (8 Saks locations and 1 Neiman Marcus). Saks Global is also closing 14 of its 17 “Fifth Avenue Club” personal styling suites in markets better served by Neiman Marcus stores.

Potentially Powerful Marginal Economics

The United States is wildly over-spaced with luxury department stores, both in terms of the number of locations and the size of most stores. Neiman Marcus and Saks Fifth Avenue also possess very similar target customers, vendor mixes, and store models.

Closing small market stores will have little overall impact on the group’s cash flows, but it allows for greater focus of management attention and precious capital.

Closing stores in overlapping trade areas, however, can meaningfully reset enterprise economics. While rents for department store anchors are typically quite low, consolidating sales to one store should greatly improve the four-wall profitability of the surviving location.

Of course, the incremental EBITDA magnitude of this will ultimately be determined by the relative proximity of the stores and the degree of competition from both similar retailers (Nordstrom, Bloomingdale’s, specialty boutiques) and )vendor-owned stores.

They’re Not Done Yet

This first tranche of closings is driven by considerations that will guide another round (or rounds) that are likely to have far greater impact.

This first wave includes Saks nameplate stores in smaller cities (Richmond, Tulsa, Columbus, Birmingham, New Orleans) that have long been rumored to be, at best, marginally profitable with contribution to overall sales in the low single digits.

More interesting is the closing of formerly competing Saks and Neiman’s stores in the same trade-areas. This wave includes Saks locations at

• American Dream (East Rutherford, N.J.) where Neiman’s has nearby stores in Paramus and Short Hills.

• Bala Plaza (Philadelphia). Neiman’s has a store a short drive away at the King of Prussia Mall.

• Biltmore Fashion Park (Phoenix). Neiman’s has a store at Scottsdale Fashion Square, just over ten minutes away.

Neiman’s Boston location in Copley Place is also closing. Saks has a store essentially across the street in the Prudential Center and Copley Place is getting a long overdue reinvention courtesy of Simon Property Group.

Layups & Complications

Decisions to close stores where the trade-area opportunity is modest and Saks and Neiman’s are literally in the same mall (St. Louis, Las Vegas, Troy MI, Tyson’s Corner, Houston Galleria, Bal Harbour, Boca Raton) may be no brainers. In San Antonio the stores are in different malls, but it’s a modestly sized market and the Neiman’s in the Shops at Cantera is clearly the superior location.

In Atlanta the stores are in malls across the street from each other. In Beverly Hills, they are essentially next door to each other on Wilshire Boulevard. In Orange County they’re in different malls but under a 15 minute drive from each other. Southeast Florida has a number of stores that are in close proximity (Dadeland, Coral Gables, Brickell, Bal Harbour).

Some of these stores are higher volume and likely quite profitable on their own and it’s possible that a strategy could be developed to more clearly differentiate the two store brands so that both nameplates could co-exist in the same trade-area.

So What’s Next?

It would not surprise me to see several more closings come from the remaining Saks small market stores, which includes Greenwich, Sarasota, Beachwood (Ohio), and Raleigh. My guess is Naples will stay open as it is said to be a solid performer with no nearby Neiman’s or Saks location.

Two factors will likely determine the ultimate number of near-term closings from the remaining list.

Does the new management team have a workable strategy to operate both nameplates in the some overlapping trade-areas? Will some property owners (Simon, Brookfield) offer up short-term leases to either give Saks Global time to sort out the first issue and/or allow the mall operators time to start executing a reinvention.

Ultimately, my best guess is we will see 10 to 12 more store closings announced soon.

DEPARTMENT OF THE OBVIOUS

Consumers are paying for the tariffs imposed by He-Who-Must-Not-Be-Named.

ON THE POD

This week our guests are fellow Rethink Retail Top Retail Experts Jack Stratten, Director, Insider Trends and Kevin Ervin Kelley, Principal & Co-founder Shook Kelley and author of Irreplaceable: How to Create Extraordinary Places That Bring People Together.

In this discussion, recorded in the Narvar podcast studio at the NRF’s “Big Show,” we take a deep dive into the future of physical retail as these two retail visionaries help us explore what makes modern stores not just functional—but truly remarkable. All this, plus the retail news you need to know.

Listen here, watch here, and follow us wherever you enjoy your podcasts.

From the Archives

Warby Parker co-CEO & co-founder Neil Blumenthal joined us to share the eyewear retailer’s remarkable journey from DNVB darling to fast growing omni-channel star.

THREE OTHER IDEAS FROM ME THIS WEEK

Check out Kevin Ertell’s remarkable new book: The Strategy Trap.

Bring me into your company or to your next event to speak.

Explore our short and fun remarkable retail store tour videos.

I’M NOT CRYING, YOU’RE CRYING

#leadersleap

There is this idea that quitting is for losers.

In fact, we don’t have to spend much time among our friends or on social media to run across the never give up, in-it-to-win-it-no-matter-what ethos. There’s a whole socially acceptable narrative built around the notion that only weak people quit and that failure is never an option.

Perseverance, grit, determination, and hard work are often critical to achieving our goals. But frequently our best work, the work that disrupts, challenges the status quo, makes a ruckus, comes precisely because failure IS an option.

It happens when we know this might not work and we choose to do it anyway.

And yet…

Remarkable leaders don’t buy into hustle porn.

We know opportunity costs are real.

We accept that an escalating commitment to a failing course of action is one of the dumbest things we can do.

The question isn’t whether quitting is inherently good or bad.

The question is why we choose to quit.

If we quit simply because it’s too hard or we can’t slay that MF-er of a dragon that Steven Pressfield labels Resistance, we may well be quitting for all the wrong reasons.

If we quit because we see that we are playing a losing hand or because it frees us up to do the work that truly matters, then quitting not only frees us from the sunk-cost fallacy, it can supercharge our efforts to move faster, aim higher, and take the bold actions we must.

The power of no—or no longer—can create the fierce power of now.

And now, more than ever, we need to go unstuck ourselves.

“If you do not change direction, you may end up where you are heading.”

- Lao Tzu

STORIES THAT MATTERED THIS WEEK

Amazon: The Fault in Their Stores

Speaking of quitting, the road is littered with Amazon’s failed experiments, ranging from Amazon Books to Amazon 4-Star to Amazon Style.

This past week Amazon took Amazon Fresh off life support.

Now, if you’ve followed my work over the years you know I believe that for Amazon to sustain its above average long-term retail growth rate it needs a more robust physical store strategy.

You’ll also know that while I have applauded the company’s willingness to Always. Be. Testing, I’ve found all of their brick-and-mortar experiments to be, um, a notch below remarkable. As far as I can tell, the root cause for this is a tendency to be overly left-brained and tech-centered in their approach, rather than leaning into more right-brain, human-centric design thinking.

Regardless, Amazon rightly decided not to double down on a losing hand and instead will be doubling down on its already impressive online grocery efforts, as well as opening quite a few more Whole Foods Market stores.

Simma Down Na

In related news, my social media feed was chock-a-block with folks getting all hot and bothered about Amazon’s planned “superstore.”

Sure, the one-two punch of Amazon’s bailing on their Fresh stores while news spread that they would open a 200,000+ square foot combination general merchandise store and fulfillment center is noteworthy.

But. It. Is. Just. One. Store.

And if successful, which we won’t know for some time, that will leave the score Amazon: 1 Walmart: 3,500+.

Closing Time

My friends at Coresight Research are out with their annual store openings and closing predictions.

It turns out that physical retail is still not dead—who knew!—as many retailers will collectively open many thousands of stores, with value retailers continuing to lead the way.

At the same time thousands are expected to close, though Coresight sees the total number dropping to just under 8,000, which would be a 4.5% decrease year over year.

Now to be fair, last year Coresight was wildly wrong about their 2025 prediction that store closings might double to around 15,000. Store closings were up, but very slightly.

Turns out this predictions game is not for the faint of heart.

Retail Reality: It’s Death in the Middle

For close to a decade I’ve been going on about retail’s great bifurcation and imploring retailers to run, not walk, away from the murky middle or risk an extinction level event.

While it’s convenient to blame the growth of e-commerce for struggling retailers’ problems, the evidence is overwhelming that it’s their lack of remarkability that is the driver. And it’s impossible to be remarkable when your value proposition is delivering average products to average people in an average way.

So it’s no surprise that Francesca’s is liquidating and a similar fate may well befall Eddie Bauer.

We can debate how accurate any given store closing prediction may be, but it’s not controversial what’s behind most of the closings.

The collapse of the unremarkable middle continues unabated.

One Trillions Dollars!

John Furner steps into his new role as Walmart CEO when the world’s largest retailer (for a bit longer, anyway) seems be firing in all cylinders.

During the past few years Walmart’s delivered above average revenue growth (despite a massive base )and is powering ahead with double-digit growth in its extremely lucrative Walmart Connect advertising business.

This week Mr. Furner’s employer also entered rarified air joining the ranks of only about a dozen companies with a trillion dollar market capitalization.

Meet the New Boss, Same as the Old Boss?

Things are less rosy for the new guy at Target.

In fact, Michael Fiddelke inherits a bit of a mess.

Ten of the past 12 quarters Target’s comparable stores sales have been flat or down. Walmart’s share price is up more than 150% during the past five years, whereas Target’s declined nearly 40%.

Much of this is a result of plenty of “own goals.”

Target drifted away from its positioning as a good “trade-up” alternative to Walmart just as the Bentonville-based beast was making a play for more affluent consumers. Target’s lackluster grocery and essentials offering caused it to lose share just as more consumers were seeking out one-stop shopping. Poor front-of-house execution made it seem like they had embraced a “Get Less. Pay the Same” corporate strategy.

Target also seems like retail’s “profiles in cowardice” award recipient. It lost customers with a 2023 LGBTQ+ boycott and again after rolling back DEI initiatives last year. It’s also come under scrutiny again because of its bloviating response to the killings of Renee Good and Alex Pretti.

Clearly Target needs bold change, but there are plenty of legitimate questions about this leadership shift.

First of all, Brian Cornell, the CEO at the helm during the time that Target lost its mojo, is sticking around as executive chair of the Board of Directors. Second, prior to becoming the new boss Fiddelke was the old boss overseeing many of the key functions that struggled to deliver.

Watch this space.

ON THE POD

Our guests are fellow NRF Top Retail Voices Billy May and David J. Katz, who deliver a master class on what's new and next in retail.

In this fun and insightful discussion recorded live in the Narvar podcast studio at the NRF’s “Big Show,” we unpack essential leadership lessons, go deep on what “value” means today, explore what it takes to understand customer journeys, and more!

Listen here, watch here, and follow us wherever you enjoy your podcasts.

From the Archives

Sephora NA CEO Artemis Patrick joined us for an inspiring conversation about her leadership journey and what makes Sephora so remarkable.

IF THIS NEWSLETTER RESONATES . . .

…and you want to take our relationship to the next level, here are 3 ideas:

BOOK AN ADVISORY VIDEO CALL. I’m now live on Intro.co for 1:1 concise and high impact advisory calls. Through the end of February I’ll be donating 100% of my proceeds to World Central Kitchen. Secure time here.

BRING ME TO YOUR NEXT EVENT TO SPEAK. I’ve delivered inspiring keynotes at industry conferences on six continents and been a featured speaker at dozens of corporate events, customer dinners, book signings, and more. Reach out to events@sageberryconsulting.com

BUY A BOOK. Remarkable Retail: How to Win & Keep Customers in the Age of Disruption is the best-selling retail strategy book of the past decade. Leaders Leap: How to Transform Your Company at the Speed of Disruption lays out seven mind leap to help you navigate a volatile and uncertain future. Both are available in hardcover, on Audible, and in a Kindle edition for only $9.99.