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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: Whole Foods Market is going small. The Amazon owned Grosser

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Speaker 2: is opening new small format stores aimed at serving quick

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Speaker 2: trip urban consumers. You've heard this throughout the day from

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Speaker 2: Charlie Pellett. It's called Whole Foods Market Daily Shop. The

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Speaker 2: stores will range between seven thousand to fourteen thousand square feed,

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Speaker 2: so to put that in perspective, a typical whole food

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Speaker 2: store averages about forty thousand square feed, so pretty small

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Speaker 2: compared to a typical store. The Daily Shop is also

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Speaker 2: going to offer similar but slimmer assortment of products, ranging

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Speaker 2: from fresh produce and frozen food to prepackaged meals in

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Speaker 2: the three sixty five branded products, but they will not

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Speaker 2: have buffet bars or meat counters. For more, we go

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Speaker 2: to Christina Minorti, Executive vice president of Growth and Development

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Speaker 2: at Whole Foods Market and Amazon. She joins us here

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Speaker 2: in the Bloomberg Interactive Brokers studio. Christina, how are you.

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Speaker 1: I'm great, Thank you for having me today.

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Speaker 2: Well, thanks so much for joining us. So remember this

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Speaker 2: is not the first time that Amazon has experimented with

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Speaker 2: Whole Foods going smaller, or even Whole Foods has experimented

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Speaker 2: with it. So back in twenty sixteen, Whole Foods opened

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Speaker 2: smaller stores called three sixty five but by Whole Foods Market.

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Speaker 2: If consumers remember that, how is this different.

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Speaker 1: Well, thank you for bringing that one up. The three

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Speaker 1: sixty five store was actually before Amazon acquired us, and

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Speaker 1: it was a time when we really needed to work

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Speaker 1: on our value image prior to Amazon. And you know,

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Speaker 1: we learned a lot from the three sixty five. You know,

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Speaker 1: we did close them and not close them, but we

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Speaker 1: converted them over to Whole Food's markets.

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Speaker 2: So they made them like the main Whole food Yeah.

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Speaker 1: Into twenty nineteen. And this one's a little different because

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Speaker 1: the three sixty five stores were twenty five thousand bigger. Yeah,

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Speaker 1: so this is smaller. The idea around Whole Foods Market

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Speaker 1: daily Shop is really for a convenient shop. If we

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Speaker 1: learned one thing over the last few years, as you

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Speaker 1: were saying earlier, you love home shopping. You love it

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Speaker 1: being delivered to your house. People want things quickly, So

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Speaker 1: we envisioned for daily Shop is our customers will still

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Speaker 1: shop our regular stores here in Manhattan, but they'll have

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Speaker 1: another avenue to shop Whole Foods market. That's quick and easy.

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Speaker 1: If you want to come in and you need to

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Speaker 1: get something just for dinner tonight, or you're going to

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Speaker 1: have a dinner party, we'll have all of the items

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Speaker 1: that you need.

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Speaker 3: What's the difference, right, I'm one of those shoppers that

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Speaker 3: I go into a whole Foods or my local grocery

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Speaker 3: stores to look at all the cheeses and find a

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Speaker 3: new gem. And you know, I do it for fun

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Speaker 3: and it's my it's my therapy. So we'll come over

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Speaker 3: anytime to the fridge of stock sometimes to stock. Christina,

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Speaker 3: what can't you find.

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Speaker 1: At these places?

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Speaker 3: If if you're one of those people that likes to explore.

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Speaker 1: Yeah, everything you just mentioned, you'll be able to find

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Speaker 1: a daily shop. The difference is how we're delivering it

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Speaker 1: to the customer. So when you go into a typical foods,

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Speaker 1: you know we'll have a full service meat counter. This

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Speaker 1: store will have the same selection of meat. It just

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Speaker 1: won't be in the counter. It's how we're delivering it.

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Speaker 1: It's packaged. We'll still going to have all of our

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Speaker 1: beautiful cheese, and my refrigerator is the same lots of cheese,

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Speaker 1: so we'll still have the same selection. But it'll be

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Speaker 1: wrapped and ready to go again quick in, quick out.

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Speaker 1: That's the idea behind it.

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Speaker 2: So Amazon has owned Whole Foods for a number of

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Speaker 2: years at this point, and I think people in Manhattan

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Speaker 2: will be familiar with the Amazon Ghost stores. Is there

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Speaker 2: any sort of relationship or like learnings that you took

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Speaker 2: from what Amazon brought to Amazon Go in terms of technology,

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Speaker 2: in terms of consumer habits that you then brought over

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Speaker 2: to this version of Whole Foods.

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Speaker 1: Well, the Amazon Ghost stores, you know, we have them

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Speaker 1: in different cities and they're significantly smaller, they're only about

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Speaker 1: twenty five hundred square feet. But you know, that's what

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Speaker 1: I love so much about Whole Foods Market and Amazon.

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Speaker 1: We all learn from each other, and you know, we

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Speaker 1: lean on Amazon obviously for technology, Like the store is

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Speaker 1: going to have Amazon Palm, which.

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Speaker 2: Is some Whole Foods that I go to.

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Speaker 1: All the Whole Foods have it now, kay, and we

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Speaker 1: will have it obviously in daily Shop. So we really

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Speaker 1: learned from each other, and you know, just like we

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Speaker 1: did a deep dive on the three sixty five concept

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Speaker 1: as we were developing this concept, we've worked closely with

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Speaker 1: the Amazon Go team. So we are constantly learning and

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Speaker 1: we really lean on.

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Speaker 2: In FORSS technology at this point.

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Speaker 1: No, we'll not have JWL at least the first couple

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Speaker 1: of stores. We'll have self checkout. We'll have a manned register,

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Speaker 1: and then it will also have the pump.

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Speaker 2: Do you envision it ever ever having this technology? You know,

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Speaker 2: I ran into this technology at a ski mountain recently

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Speaker 2: and I think it was actually probably it might have

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Speaker 2: been actually Amazon technology.

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Speaker 1: Yeah, you're finding more and more of it now.

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Speaker 2: But do you envision like a seven thousand to fourteen

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Speaker 2: thousand square foot store having this tech.

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Speaker 1: It could be possible for the first few or not.

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Speaker 1: We really want to concentrate on how we're displaying the product.

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Speaker 1: We have a little more freedom when you don't have

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Speaker 1: JWO in a store, of how abundant. And that's the

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Speaker 1: thing about Daily Shop. When we design the store, we

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Speaker 1: use some new designers, and every place that you turned,

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Speaker 1: you're going to see product. I mean, we really used

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Speaker 1: every inch of this space to really just celebrate food.

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Speaker 1: So you'll definitely find your cheeses.

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Speaker 2: I just want to say, I don't know what JWO is,

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Speaker 2: but I imagine it.

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Speaker 1: Just walk out.

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Speaker 2: Okay, So it's like you know some places, some airports

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Speaker 2: have it. Now you know, you walk in and you

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Speaker 2: leave and you still get charged, so you're not still

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Speaker 2: on it.

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Speaker 3: Let's take a step back for a second, because what

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Speaker 3: was the demand you felt that you were meeting here.

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Speaker 3: Is there a reason that was there a trend among

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Speaker 3: shoppers that you saw that you said, hey, this would work.

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Speaker 1: Yeah, I think you said what I said earlier is convenience.

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Speaker 1: You know, I have a very good friend of mine

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Speaker 1: who's lived in the city most of her life. She

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Speaker 1: lives fourteen blocks away from the store right down street,

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Speaker 1: fifty seventh Street store. She won't shop there because it's

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Speaker 1: fourteen blocks away, but she loves whole Foods, so yeah,

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Speaker 1: she can get delivery. But if she wants to experience,

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Speaker 1: like you said, have that experience while you're going in

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Speaker 1: the store, We're going to pop these in between whole

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Speaker 1: foods stores and you'll be able to experience Whole Foods

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Speaker 1: in a convenience.

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Speaker 3: But is that the stores being busier? Is it New

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Speaker 3: Yorkers being lazier?

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Speaker 1: Right?

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Speaker 3: What is driving them to want more convenience when you

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Speaker 3: can already get your food delivered?

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Speaker 1: Having delivery I think is great for a good segment

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Speaker 1: of our customers. But like you said earlier, you love

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Speaker 1: shopping our stores. We find with our customers is they

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Speaker 1: use delivery and they shop our stores. So this is

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Speaker 1: just going to give them another avenue to shop our

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Speaker 1: stores in a convenient way.

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Speaker 2: Talk to us a little bit about this relationship that

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Speaker 2: Amazon has had critics I don't. Critics have said that

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Speaker 2: Amazon has not figured out retail yet, which is pretty

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Speaker 2: remarkable given or physical retail. I should say pretty remarkable

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Speaker 2: given their footprint, and they haven't really figured out like

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Speaker 2: the Whole Foods identity and how they work that in.

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Speaker 2: You've been at Whole Foods for well since the nineteen

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Speaker 2: nineties at this point, so you've seen many different iterations

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Speaker 2: of it. How would you how would you respond to

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Speaker 2: that if critics said that, you know, it's.

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Speaker 1: Been a wonderful partnership. It really has again to lean

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Speaker 1: on the technology that Amazon has, that the discipline and

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Speaker 1: running your business, the processes, that's been really great. And

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Speaker 1: I think now the competition the people like myself where

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Speaker 1: we're overseeing I'm overseeing Amazon teams and Whole Foods market teams.

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Speaker 1: So bringing those teams together. We've had just really good results.

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Speaker 1: You have forty years of retail on the whole food side,

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Speaker 1: and then you have all this experience of Amazon. We're

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Speaker 1: going to win in grocery. We're going to be a

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Speaker 1: world class grocer for each of the segments, whether it's

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Speaker 1: a conventional shopper or a whole foods market shopper. Amazon,

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Speaker 1: We're going to win in grocery.

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Speaker 3: What do you think is kind of the thing that

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Speaker 3: New Yorkers would like most about this? And how do

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Speaker 3: you see it expanding on to other cities? I mean,

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Speaker 3: does this only work for really big cities?

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Speaker 1: Good question, you know. For right now, we're going to

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Speaker 1: concentrate on cities. Obviously New York. We've been very successful here,

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Speaker 1: but we've done a lot of work the last few

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Speaker 1: years and really trying to realize what's the right size

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Speaker 1: store for the market, even if we're looking at a

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Speaker 1: suburban store, you know, is it a forty thousand, is

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Speaker 1: it a twenty five thousand. So we've got a great

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Speaker 1: science team on the Amazon team that's helping us figure

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Speaker 1: that out. So we're making really good real estate decisions.

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Speaker 2: Does it work if people have cars? Or is this

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Speaker 2: a store concept for people who aren't driving.

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Speaker 1: No, I think it could definitely be both. Like I said,

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Speaker 1: we're concentrating on the cities right now, but I envision

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Speaker 1: again that we could have stores like this even in

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Speaker 1: suburban areas, suburbandense areas.

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Speaker 3: Which yeah, suburban dents areas. If you think about it,

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Speaker 3: does it allow you to somehow open more stores because

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Speaker 3: you can open smaller ones?

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Speaker 1: Yeah? Absolutely. I mean finding a real estate box that's

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Speaker 1: you know, seven or eight thousand square feet as opposed

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Speaker 1: to fifty thousand square feet, we can move a lot

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Speaker 1: quicker with our growth with the Nashville, Upstate New York.

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Speaker 3: What do we think, Tim, Wait, as long as we

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Speaker 3: can do Bloomberg Radio from there, then I'm good.

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Speaker 2: Hey, I really appreciate you coming by. Christina, Thanks so much.

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Speaker 2: That's Christina Minorti, executive vice president of Growth and Development

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Speaker 2: at Whole Foods Market and Amazon, talking about the new

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Speaker 2: Whole Foods Market Daily Shop, the smaller footprint stores that

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Speaker 2: are fraction of the size of a typical Whole Foods