1 00:00:02,720 --> 00:00:11,280 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. It's ninety degrees outside, 2 00:00:11,560 --> 00:00:14,120 Speaker 1: you're sweating from your morning commute and almost late for 3 00:00:14,160 --> 00:00:16,599 Speaker 1: a meeting, so you pop into a Walgreens or a 4 00:00:16,640 --> 00:00:19,520 Speaker 1: CVS to grab a seltzer and just to be safe, 5 00:00:19,640 --> 00:00:24,040 Speaker 1: a little emergency deodorant. But you get slowed down because 6 00:00:24,320 --> 00:00:27,480 Speaker 1: that deodorant is locked up. Trying to get some deodorant, 7 00:00:27,600 --> 00:00:30,760 Speaker 1: I've been waiting three minutes ish. 8 00:00:30,840 --> 00:00:34,720 Speaker 2: You can't even get socks because it's locked Since when 9 00:00:34,760 --> 00:00:36,920 Speaker 2: are soft caramels a controlled substance? 10 00:00:37,720 --> 00:00:40,560 Speaker 1: This is the plight of the modern shopper. If you've 11 00:00:40,560 --> 00:00:43,159 Speaker 1: tried to buy something in person at a retailer like 12 00:00:43,200 --> 00:00:46,199 Speaker 1: Target or CVS in the past few years, you've probably 13 00:00:46,240 --> 00:00:50,040 Speaker 1: noticed that more and more everyday, items from deodorant to 14 00:00:50,440 --> 00:00:54,640 Speaker 1: soft caramels seem to be barricaded behind plastic shields. 15 00:00:54,840 --> 00:00:58,080 Speaker 2: If you're in a location where corporate leadership has decided 16 00:00:58,440 --> 00:01:00,440 Speaker 2: that stuff needs to be locked up in those stores, 17 00:01:00,720 --> 00:01:04,000 Speaker 2: it can be almost anything that you find behind lock 18 00:01:04,000 --> 00:01:04,360 Speaker 2: and key. 19 00:01:04,560 --> 00:01:07,959 Speaker 1: Bloomberg's Amanda Mole has been closely following this retail trend. 20 00:01:08,319 --> 00:01:10,520 Speaker 1: She says it's been around for a while, but it 21 00:01:10,600 --> 00:01:13,200 Speaker 1: really took off in the US in the aftermath of 22 00:01:13,240 --> 00:01:16,880 Speaker 1: the COVID pandemic, But four years later, Amanda says, there's 23 00:01:16,959 --> 00:01:20,920 Speaker 1: little evidence that locking up essentials has done retailers any good. 24 00:01:21,640 --> 00:01:25,080 Speaker 1: And now there's more and more evidence that the practice 25 00:01:25,280 --> 00:01:27,120 Speaker 1: might be backfiring. 26 00:01:26,600 --> 00:01:28,280 Speaker 2: Because when you lock things up, for example, you don't 27 00:01:28,280 --> 00:01:30,160 Speaker 2: sell as any of them. We've kind of proven that 28 00:01:30,680 --> 00:01:31,560 Speaker 2: pretty conclusively. 29 00:01:32,200 --> 00:01:35,480 Speaker 1: That was Walgreen's CEO, Tim Wentworth on an earnings call 30 00:01:35,520 --> 00:01:39,840 Speaker 1: in January. It was a surprising admission because locking up 31 00:01:39,880 --> 00:01:41,959 Speaker 1: items started off as a move that a lot of 32 00:01:42,000 --> 00:01:45,760 Speaker 1: companies adopted as part of a broader fight against shoplifting, 33 00:01:46,440 --> 00:01:47,240 Speaker 1: and now. 34 00:01:47,120 --> 00:01:51,080 Speaker 2: He acknowledged that locking stuff up has hurt the retailer. 35 00:01:51,440 --> 00:01:55,280 Speaker 2: It has reduced sales, It has annoyed customers, it has 36 00:01:55,360 --> 00:01:57,000 Speaker 2: driven people to shop elsewhere. 37 00:01:57,560 --> 00:02:01,000 Speaker 1: So where does that leave shoppers on a busy day? 38 00:02:01,400 --> 00:02:04,240 Speaker 1: Will your body wash stay behind lock and key? Will 39 00:02:04,280 --> 00:02:06,320 Speaker 1: that olay ever see the light of day? 40 00:02:06,480 --> 00:02:09,079 Speaker 2: I had to keep pressing the button of like assistants 41 00:02:09,160 --> 00:02:12,480 Speaker 2: needed for people who's not bad and over and over 42 00:02:12,600 --> 00:02:15,480 Speaker 2: and no one ever came. No one ever came. 43 00:02:16,040 --> 00:02:23,160 Speaker 1: What this is the big take from Bloomberg News. I'm 44 00:02:23,200 --> 00:02:26,960 Speaker 1: Sarah Holder today on the show The Consequences of the 45 00:02:27,000 --> 00:02:30,440 Speaker 1: Retail lock up Era, how the trend caught on, what 46 00:02:30,480 --> 00:02:32,679 Speaker 1: it would take for it to end, and how it's 47 00:02:32,720 --> 00:02:41,359 Speaker 1: already changed the way we shop. When did you first 48 00:02:41,400 --> 00:02:45,200 Speaker 1: start to see items locked up on store shelves? 49 00:02:45,680 --> 00:02:48,240 Speaker 2: Locking up certain types of things in certain types of 50 00:02:48,240 --> 00:02:50,600 Speaker 2: stores goes back to like when I was working at 51 00:02:50,600 --> 00:02:53,359 Speaker 2: best Buy in college in the mid two thousands. There 52 00:02:53,440 --> 00:02:56,920 Speaker 2: has for a really long time been like very particular 53 00:02:57,280 --> 00:03:00,640 Speaker 2: products that are like a high theft risk because they're small, 54 00:03:00,680 --> 00:03:04,240 Speaker 2: they're valuable, they're in high demand. Like what when I 55 00:03:04,360 --> 00:03:06,519 Speaker 2: was there, it was a lot of like PlayStation games. 56 00:03:07,000 --> 00:03:09,800 Speaker 2: Now you see a lot of expensive cell phone accessories, 57 00:03:10,280 --> 00:03:13,040 Speaker 2: sometimes phone chargers, things that are easy to conceal, it 58 00:03:13,080 --> 00:03:15,200 Speaker 2: would be easy to flip these days. 59 00:03:15,320 --> 00:03:18,640 Speaker 1: Amanda covers retail and writes a column about consumer culture 60 00:03:18,680 --> 00:03:21,679 Speaker 1: for Business Week. Since our college days at best Buy 61 00:03:22,040 --> 00:03:25,600 Speaker 1: stores have changed pretty significantly, Amanda says, they're not just 62 00:03:25,680 --> 00:03:31,720 Speaker 1: locking up small expensive electronic products. They're locking up everything. 63 00:03:31,800 --> 00:03:35,480 Speaker 2: At a particular target. I found men's underwear, men's socks, 64 00:03:35,760 --> 00:03:41,280 Speaker 2: all kinds of cleaning products, laundry, dechargent, mops, shampoo, body wash. 65 00:03:41,480 --> 00:03:44,720 Speaker 2: I've seen like shower puffs locked up, which costs like 66 00:03:44,880 --> 00:03:47,600 Speaker 2: a dollar. Sometimes you walk down a certain aisle and 67 00:03:47,640 --> 00:03:50,560 Speaker 2: the entire aisle on both sides is fully encased in 68 00:03:50,640 --> 00:03:54,120 Speaker 2: plexiglass and locked. So the average value of stuff being 69 00:03:54,200 --> 00:03:57,000 Speaker 2: locked up is on a lot of these aisles less 70 00:03:57,000 --> 00:03:57,800 Speaker 2: than ten dollars. 71 00:03:58,800 --> 00:04:02,800 Speaker 1: Amanda says this age of retail lockups, where anything and 72 00:04:02,880 --> 00:04:06,200 Speaker 1: everything is fair game, took off in earnest coming out 73 00:04:06,240 --> 00:04:06,960 Speaker 1: of the pandemic. 74 00:04:07,440 --> 00:04:09,520 Speaker 2: In twenty twenty one, I wrote about what I called 75 00:04:09,520 --> 00:04:12,320 Speaker 2: at the time the Great Shoplifting freak Out, which was 76 00:04:12,400 --> 00:04:17,800 Speaker 2: this sort of like generalized media panic about what they 77 00:04:17,960 --> 00:04:21,520 Speaker 2: termed as like increased rates of theft from retail stores. 78 00:04:21,600 --> 00:04:25,159 Speaker 2: There were like a couple of videos that went viral showing, 79 00:04:25,240 --> 00:04:27,760 Speaker 2: you know, groups of people rushing into there was a 80 00:04:27,760 --> 00:04:30,919 Speaker 2: nordstream in California. There are a couple like famous videos 81 00:04:30,920 --> 00:04:35,120 Speaker 2: of this, and that all got sort of spun into 82 00:04:35,160 --> 00:04:37,839 Speaker 2: this idea that retailers are at the mercy of the 83 00:04:37,880 --> 00:04:40,920 Speaker 2: sort of lawless public. And if you think about what 84 00:04:40,960 --> 00:04:42,960 Speaker 2: twenty twenty one was like in the US, there was 85 00:04:43,000 --> 00:04:45,880 Speaker 2: like a real sense of general unease coming out of 86 00:04:45,920 --> 00:04:48,680 Speaker 2: the pandemic, and people being nervous about going out again, 87 00:04:48,720 --> 00:04:50,920 Speaker 2: and a lot of people got really used to shopping online, 88 00:04:51,240 --> 00:04:54,599 Speaker 2: so it tapped into this like generalized anxiety about the 89 00:04:54,640 --> 00:04:55,440 Speaker 2: outside world. 90 00:04:55,839 --> 00:04:59,480 Speaker 1: Whether this shoplifting panic was backed up by concrete evidence 91 00:04:59,560 --> 00:05:01,640 Speaker 1: Amandas says is another story. 92 00:05:01,800 --> 00:05:05,360 Speaker 2: There's not a lot of good data available on theft rates. 93 00:05:05,520 --> 00:05:08,920 Speaker 2: Often these numbers are released by industry lobby groups and 94 00:05:09,040 --> 00:05:13,440 Speaker 2: people who are trying to demonstrate a phenomenon that they 95 00:05:13,480 --> 00:05:17,840 Speaker 2: believe is happening. From surveys that ask retail management how 96 00:05:17,839 --> 00:05:21,640 Speaker 2: they feel about shoplifting, how they feel about certain types 97 00:05:21,680 --> 00:05:24,359 Speaker 2: of product loss as a threat to their business, it 98 00:05:24,440 --> 00:05:25,560 Speaker 2: is very squishy. 99 00:05:25,720 --> 00:05:27,920 Speaker 1: Feelings are a lot different than numbers. 100 00:05:28,080 --> 00:05:31,720 Speaker 2: Yes, they're asking about perception instead of asking for proof. 101 00:05:32,200 --> 00:05:36,039 Speaker 1: These stores do keep tabs on what they call shrinkage. 102 00:05:35,800 --> 00:05:39,960 Speaker 2: Which is the industry term for inventory that's lost and 103 00:05:40,000 --> 00:05:42,840 Speaker 2: cannot be sold for any cause. And that can be 104 00:05:43,120 --> 00:05:45,839 Speaker 2: cargo theft, it can be employee theft, it can be shoplifting. 105 00:05:45,920 --> 00:05:48,920 Speaker 2: It can be checkout errors, it can be paperwork errors. 106 00:05:48,960 --> 00:05:53,280 Speaker 2: It can be missed delivery. You get spoilage damage kind 107 00:05:53,279 --> 00:05:55,520 Speaker 2: of like the cost of doing business right. You can 108 00:05:55,520 --> 00:05:58,159 Speaker 2: lose inventory in like a zillion ways. But like over 109 00:05:58,240 --> 00:06:01,240 Speaker 2: the past like fifteen or twenty years, the shrink rate 110 00:06:01,279 --> 00:06:05,120 Speaker 2: in US retail is like pretty stable. That generally hovers 111 00:06:05,160 --> 00:06:07,600 Speaker 2: at about one point five percent. So if you are 112 00:06:07,640 --> 00:06:10,360 Speaker 2: a retailer, on average, you're going to lose about one 113 00:06:10,400 --> 00:06:13,600 Speaker 2: and a half percent of your sellable inventory to something 114 00:06:13,680 --> 00:06:15,200 Speaker 2: that is like sort of beyond your control. 115 00:06:15,440 --> 00:06:18,599 Speaker 1: So that shrink rate hasn't changed much. It's a similar 116 00:06:18,600 --> 00:06:22,720 Speaker 1: amount of inventory lost over the last few decades. But 117 00:06:22,720 --> 00:06:26,360 Speaker 1: Amanda says, what has changed is the number of employees 118 00:06:26,400 --> 00:06:27,719 Speaker 1: stocking the shelves. 119 00:06:28,080 --> 00:06:31,719 Speaker 2: Something that's really important to understand about retail stores in 120 00:06:31,720 --> 00:06:34,760 Speaker 2: the US, especially retailers that sell sort of like low dollar, 121 00:06:34,839 --> 00:06:38,120 Speaker 2: everyday essential types of things, drug stores, big box stores, 122 00:06:38,800 --> 00:06:43,279 Speaker 2: is that they are almost entirely, like woefully understaffed. It 123 00:06:43,360 --> 00:06:46,320 Speaker 2: is really hard to staff these stores because the jobs 124 00:06:46,320 --> 00:06:48,800 Speaker 2: themselves just aren't very good. They don't pay very well, 125 00:06:49,000 --> 00:06:51,960 Speaker 2: their hours are not predictable, you're on your feet all day, 126 00:06:52,240 --> 00:06:56,360 Speaker 2: you may or may not get benefits. So retailers are understaffed, 127 00:06:56,560 --> 00:07:01,200 Speaker 2: and over the years, retailers have cut staffing even further, 128 00:07:01,720 --> 00:07:04,320 Speaker 2: and that is like sort of an ideological thing, like 129 00:07:04,760 --> 00:07:08,600 Speaker 2: retailers really love to reduce labor costs, and that after 130 00:07:08,640 --> 00:07:11,520 Speaker 2: a certain point just means having fewer workers. So when 131 00:07:11,560 --> 00:07:13,400 Speaker 2: you get to that point, it becomes really hard to 132 00:07:13,480 --> 00:07:14,480 Speaker 2: manage a store. 133 00:07:14,640 --> 00:07:14,960 Speaker 1: Well. 134 00:07:15,640 --> 00:07:20,720 Speaker 2: So what retailers have done is sort of retrofit stores 135 00:07:20,720 --> 00:07:23,240 Speaker 2: with systems that mean in their minds that they can 136 00:07:23,360 --> 00:07:26,920 Speaker 2: run a store with fewer employees. That's what self checkout is, 137 00:07:27,160 --> 00:07:29,440 Speaker 2: and that's what these locked up shelves. 138 00:07:29,000 --> 00:07:32,640 Speaker 1: Are, and that great shoplifting freak out of twenty twenty one. 139 00:07:33,200 --> 00:07:36,480 Speaker 1: Amanda says, it just helped justify these sorts of measures. 140 00:07:37,040 --> 00:07:41,240 Speaker 2: If retailers can't and won't hire more people, then what 141 00:07:41,280 --> 00:07:44,360 Speaker 2: they're going to have to do is justify the sort 142 00:07:44,400 --> 00:07:48,040 Speaker 2: of externalities of these staffing choices. So you lose the 143 00:07:48,120 --> 00:07:50,760 Speaker 2: essential functions of the store, and more of the labor 144 00:07:50,760 --> 00:07:53,440 Speaker 2: of running the store is put on the customer. And 145 00:07:54,280 --> 00:07:57,960 Speaker 2: it's really convenient to have sort of an external threat 146 00:07:58,360 --> 00:08:00,800 Speaker 2: that has forced you to do these things rather than 147 00:08:00,840 --> 00:08:03,320 Speaker 2: your own management decisions that has forced you to do 148 00:08:03,360 --> 00:08:03,840 Speaker 2: these things. 149 00:08:04,280 --> 00:08:09,000 Speaker 1: That's so interesting. So basically stores stopped hiring people at 150 00:08:09,000 --> 00:08:11,360 Speaker 1: the same rate to do the work of actually staffing 151 00:08:11,400 --> 00:08:13,800 Speaker 1: these stores, helping people with check out and keeping an 152 00:08:13,800 --> 00:08:17,120 Speaker 1: eye on things, making sure people weren't stealing goods. And 153 00:08:17,160 --> 00:08:20,440 Speaker 1: so instead of hiring more people, they installed more plexiglass. 154 00:08:20,520 --> 00:08:22,240 Speaker 2: Yes, and when you do that, you get some. 155 00:08:22,200 --> 00:08:26,560 Speaker 1: Externalities, externalities that you're probably familiar with. 156 00:08:27,040 --> 00:08:29,360 Speaker 2: You press the button, nobody comes. She pressed the button again. 157 00:08:29,600 --> 00:08:31,960 Speaker 2: You know, it's been five minutes, ten minutes. You got 158 00:08:32,000 --> 00:08:33,640 Speaker 2: to go back to work. You're on your launch break. 159 00:08:33,640 --> 00:08:34,160 Speaker 2: You just leave. 160 00:08:34,440 --> 00:08:38,240 Speaker 1: Social media is filled with angry customers complaining that locked 161 00:08:38,280 --> 00:08:40,679 Speaker 1: shells have ruined their shopping experience. 162 00:08:40,880 --> 00:08:44,000 Speaker 2: It took me fifteen minutes to get somebody to come 163 00:08:44,000 --> 00:08:46,079 Speaker 2: over to like get some laundry soap. 164 00:08:46,280 --> 00:08:49,320 Speaker 1: This turned into like a thirty minute or deal just 165 00:08:49,360 --> 00:08:50,640 Speaker 1: to get facial cleanser. 166 00:08:50,960 --> 00:08:52,960 Speaker 2: It is one of the fundamental building blocks of like 167 00:08:53,080 --> 00:08:55,520 Speaker 2: modern life in the United States that these stores work, 168 00:08:56,040 --> 00:08:59,880 Speaker 2: and when they stop working, people get really mad because. 169 00:08:59,600 --> 00:09:02,160 Speaker 1: You want to hop in, get your toothpaste and leave right. 170 00:09:02,240 --> 00:09:04,560 Speaker 2: It is a situation in which something that should be easy, 171 00:09:04,600 --> 00:09:08,119 Speaker 2: something that has been easy for decades, becomes totally unworkable. 172 00:09:08,360 --> 00:09:10,760 Speaker 1: How have shoppers reacted to these changes. 173 00:09:11,080 --> 00:09:13,560 Speaker 2: They've reacted by moving their consumption of these items to 174 00:09:13,679 --> 00:09:16,320 Speaker 2: a different retailer. So it's been a boon for grocery 175 00:09:16,320 --> 00:09:18,679 Speaker 2: stores because a lot of them carry these same goods, 176 00:09:19,080 --> 00:09:21,160 Speaker 2: and it's been a big boon for online retailers. 177 00:09:21,480 --> 00:09:24,920 Speaker 1: It's hurting retail employees too. We are good at reducing 178 00:09:25,000 --> 00:09:29,040 Speaker 1: all kinds of shrink, not just elusive shoplifters, but self 179 00:09:29,120 --> 00:09:33,240 Speaker 1: checkout issues and paperworkers, tracking shipments that arrive with only 180 00:09:33,360 --> 00:09:35,320 Speaker 1: nineteen bars of soap instead of twenty. 181 00:09:35,760 --> 00:09:38,800 Speaker 2: The retail employees that I've talked to sort of uniformly 182 00:09:38,840 --> 00:09:42,440 Speaker 2: hate this system. Your employer is making you run around 183 00:09:42,480 --> 00:09:44,440 Speaker 2: like a chicken with your head cut off to unlock 184 00:09:44,600 --> 00:09:48,800 Speaker 2: cabinets of moisturizer or whatever. So you're forcing out people 185 00:09:48,960 --> 00:09:52,800 Speaker 2: who are your best workers in most cases, and you're 186 00:09:52,800 --> 00:09:55,160 Speaker 2: just going to lose product in like so many different ways. 187 00:09:55,240 --> 00:09:56,720 Speaker 2: The store is going to leak like a sieve. 188 00:09:57,559 --> 00:10:01,720 Speaker 1: So customers aren't happy, employees aren't happy, and company's bottom 189 00:10:01,760 --> 00:10:05,040 Speaker 1: lines are taking a hit too. More on that and 190 00:10:05,200 --> 00:10:16,080 Speaker 1: what they're doing about it after the break. On top 191 00:10:16,160 --> 00:10:20,880 Speaker 1: of alienating customers and annoying employees, locked up shelves at 192 00:10:20,880 --> 00:10:24,200 Speaker 1: retail stores have not exactly been good for business. 193 00:10:24,640 --> 00:10:27,400 Speaker 2: I think Walgreens and CBS in particular, If you look 194 00:10:27,400 --> 00:10:30,280 Speaker 2: at their financial results over the past few years, like 195 00:10:30,320 --> 00:10:33,480 Speaker 2: it's not been great. They are two companies in a 196 00:10:33,559 --> 00:10:36,040 Speaker 2: situation where they really do need to figure out how 197 00:10:36,080 --> 00:10:39,880 Speaker 2: to gain back some customer loyalty and encourage more foot 198 00:10:39,880 --> 00:10:41,600 Speaker 2: traffic into their stores and things like that. 199 00:10:42,360 --> 00:10:45,800 Speaker 1: Amanda says the first domino to fall was Walgreen's CEO 200 00:10:45,960 --> 00:10:49,680 Speaker 1: Tim Wentworth's submission on an earnings call that this policy 201 00:10:49,720 --> 00:10:53,480 Speaker 1: had hurt sales, that locking things up made them harder to. 202 00:10:53,440 --> 00:10:55,240 Speaker 2: Buy, because when you lock things up, for example, you 203 00:10:55,240 --> 00:10:57,160 Speaker 2: don't sell as many of them. We've kind of proven 204 00:10:57,200 --> 00:10:58,760 Speaker 2: that pretty conclusively. 205 00:10:59,160 --> 00:11:00,880 Speaker 1: How big was that to hear that from him? 206 00:11:01,120 --> 00:11:04,400 Speaker 2: It was huge. This is a topic that retailers do 207 00:11:04,480 --> 00:11:06,600 Speaker 2: not want to talk about because they know that the 208 00:11:06,640 --> 00:11:10,320 Speaker 2: general public hates this, and so hearing a CEO of 209 00:11:10,360 --> 00:11:14,440 Speaker 2: one of the main culprits in this phenomenon say like, hey, 210 00:11:14,679 --> 00:11:17,040 Speaker 2: we understand that this is bad, that this is not 211 00:11:17,080 --> 00:11:19,640 Speaker 2: a benefit to customers, that something's got to give here, 212 00:11:19,800 --> 00:11:22,600 Speaker 2: that we are turning away shoppers, it was one of 213 00:11:22,640 --> 00:11:27,640 Speaker 2: the few rare public acknowledgments that, like, this system is bad, 214 00:11:27,679 --> 00:11:30,280 Speaker 2: we got to figure out something else to do here. 215 00:11:31,200 --> 00:11:34,400 Speaker 1: In March, Walgreens agreed to a sale. It will go 216 00:11:34,520 --> 00:11:38,040 Speaker 1: private after years of shrinking profit margins and a volatile 217 00:11:38,080 --> 00:11:42,640 Speaker 1: stock price. Slumping retail sales didn't help. It's not the 218 00:11:42,679 --> 00:11:45,559 Speaker 1: only company that's looking closer at its lock up strategy. 219 00:11:46,120 --> 00:11:49,480 Speaker 1: A few weeks after that Walgreen's earnings call came news 220 00:11:49,520 --> 00:11:50,359 Speaker 1: from CBS. 221 00:11:50,840 --> 00:11:55,080 Speaker 2: CBS announced that it was expanding a pilot program that 222 00:11:55,120 --> 00:11:56,800 Speaker 2: it had been running quietly in a couple of New 223 00:11:56,880 --> 00:12:00,160 Speaker 2: York City stores. What it does is allow people the 224 00:12:00,200 --> 00:12:05,000 Speaker 2: CVS Health app on their phones to unlock certain cabinets themselves. 225 00:12:05,400 --> 00:12:08,319 Speaker 2: Do you think it'll work well? I think that the 226 00:12:08,320 --> 00:12:12,080 Speaker 2: theory is that they're going to have your name, your information, 227 00:12:12,360 --> 00:12:16,559 Speaker 2: like you're a known quantity to them, So it takes 228 00:12:16,600 --> 00:12:20,400 Speaker 2: an element of anonymity out of opening those shelves and 229 00:12:20,720 --> 00:12:24,040 Speaker 2: could potentially be a way to move the middleman, which 230 00:12:24,080 --> 00:12:26,600 Speaker 2: is the employee with the big key ring, out of 231 00:12:26,760 --> 00:12:29,559 Speaker 2: these transactions in a way that like helps the store 232 00:12:29,640 --> 00:12:30,880 Speaker 2: run a little bit more smoothly. 233 00:12:31,320 --> 00:12:35,240 Speaker 1: It's not quite removing the locked shells altogether, but Amanda 234 00:12:35,280 --> 00:12:38,240 Speaker 1: says it's essentially a way to walk back the policy 235 00:12:38,640 --> 00:12:41,360 Speaker 1: and put more control in consumers' hands. 236 00:12:41,840 --> 00:12:45,160 Speaker 2: I think that they understand that they have like overcorrected 237 00:12:45,360 --> 00:12:49,199 Speaker 2: or gone too far in like how these programs were 238 00:12:49,200 --> 00:12:52,360 Speaker 2: implemented and they can't like fully walk them back. 239 00:12:52,200 --> 00:12:54,880 Speaker 1: Because it's just too expensive to rip up your work. 240 00:12:54,960 --> 00:12:58,760 Speaker 2: It's too expensive, and also it signals failure, like you 241 00:12:58,880 --> 00:13:02,520 Speaker 2: have to sort of present to the investing public, like 242 00:13:02,880 --> 00:13:06,080 Speaker 2: the idea that like, oh, like the numbers aren't great, 243 00:13:06,160 --> 00:13:08,520 Speaker 2: but this is working, because if you rip all that 244 00:13:08,559 --> 00:13:10,640 Speaker 2: stuff out, then people have other questions. 245 00:13:11,080 --> 00:13:14,000 Speaker 1: CBS appears to be doubling down on its app based 246 00:13:14,120 --> 00:13:17,440 Speaker 1: unlocked system. A company spokesperson told us they plan to 247 00:13:17,480 --> 00:13:21,360 Speaker 1: introduce it in other communities this year. On social media, 248 00:13:21,640 --> 00:13:24,360 Speaker 1: people have raised privacy concerns about the data the app 249 00:13:24,400 --> 00:13:28,000 Speaker 1: collects because it requires customers to sign in to use it. 250 00:13:28,800 --> 00:13:32,560 Speaker 1: CBS said it quote complies with all applicable regulations to 251 00:13:32,600 --> 00:13:36,360 Speaker 1: protect customer information. For customers who prefer not to scan 252 00:13:36,440 --> 00:13:40,360 Speaker 1: the app, assistance is available to unlock the merchandise. So 253 00:13:40,440 --> 00:13:43,360 Speaker 1: we're not necessarily going to see our locked up socks 254 00:13:43,440 --> 00:13:47,840 Speaker 1: unleashed overnight, but not because keeping them behind plexiglass is 255 00:13:47,840 --> 00:13:49,520 Speaker 1: the best way to deter theft. 256 00:13:49,800 --> 00:13:52,200 Speaker 2: The best way to deter theft like this has been 257 00:13:52,240 --> 00:13:54,680 Speaker 2: studied is to properly staff your stores to make people 258 00:13:54,720 --> 00:13:57,199 Speaker 2: who might be thinking about stealing something feel like they're 259 00:13:57,240 --> 00:13:59,320 Speaker 2: going to be seen, They're going to be caught, that 260 00:13:59,400 --> 00:14:02,199 Speaker 2: they cannot go in there undetected and walk out with 261 00:14:02,240 --> 00:14:02,920 Speaker 2: whatever they want. 262 00:14:04,080 --> 00:14:06,480 Speaker 1: What do you think the future of shopping might look like? 263 00:14:06,600 --> 00:14:09,640 Speaker 1: At places where these lockups have been so central. 264 00:14:09,720 --> 00:14:14,559 Speaker 2: Stores in that arena are probably going to feel more 265 00:14:14,559 --> 00:14:17,640 Speaker 2: and more like vending machines. I went to a retail 266 00:14:17,679 --> 00:14:20,400 Speaker 2: conference recently where like there was a lot of exhibitors 267 00:14:21,000 --> 00:14:25,640 Speaker 2: with third party vendors that sell like technology solutions for 268 00:14:25,880 --> 00:14:28,800 Speaker 2: automating more things within stores that make it possible for 269 00:14:28,840 --> 00:14:31,600 Speaker 2: a customer to unlock something themselves, that makes it easier 270 00:14:31,600 --> 00:14:35,160 Speaker 2: to track customers in stores and identify people that do 271 00:14:35,240 --> 00:14:38,880 Speaker 2: all of the stuff. That seems to be bent toward 272 00:14:39,400 --> 00:14:42,800 Speaker 2: automating a lot of these things or putting more things 273 00:14:42,880 --> 00:14:48,160 Speaker 2: on the customer's plate to do themselves. I think there's 274 00:14:48,200 --> 00:14:50,320 Speaker 2: been like a re estimation of the value of like 275 00:14:50,360 --> 00:14:52,320 Speaker 2: a good in store experience and a lot of other 276 00:14:52,360 --> 00:14:54,600 Speaker 2: types of retailers, and I think this has been a 277 00:14:54,600 --> 00:14:57,800 Speaker 2: pretty effective cautionary tale because like the level of ire 278 00:14:58,040 --> 00:15:02,000 Speaker 2: and the level of anger that is directed toward retailers 279 00:15:02,080 --> 00:15:06,040 Speaker 2: that do this, and the level of like grudge holding 280 00:15:06,200 --> 00:15:09,040 Speaker 2: that people will do against these retailers, I think has 281 00:15:09,080 --> 00:15:12,240 Speaker 2: been instructive for other retailers to say, all right, we 282 00:15:12,320 --> 00:15:13,120 Speaker 2: know what not to do. 283 00:15:16,600 --> 00:15:19,520 Speaker 1: This is the Big Take from Bloomberg News. I'm Sarah Holder. 284 00:15:19,800 --> 00:15:22,600 Speaker 1: The show is hosted by Me, David gera Wan Ha 285 00:15:22,920 --> 00:15:26,200 Speaker 1: and Seleia Mosen. The show is made by Aaron Edwards, 286 00:15:26,360 --> 00:15:30,520 Speaker 1: David Fox, Eleanor Harrison Dengate, Patti hirsh Rachel Lewis, Krisky, 287 00:15:30,760 --> 00:15:36,960 Speaker 1: Naomi Julia Press, Tracy Samuelson, Naomi Shaven, Alex Hugia, Julia Weaver, 288 00:15:37,520 --> 00:15:40,920 Speaker 1: Yang Yong, and Taka Yasuzawa. To get more from The 289 00:15:40,920 --> 00:15:44,160 Speaker 1: Big Take and unlimited access to all of Bloomberg dot Com, 290 00:15:44,240 --> 00:15:48,960 Speaker 1: subscribe today at Bloomberg dot Com Slash Podcast Offer. Thanks 291 00:15:49,040 --> 00:15:52,440 Speaker 1: for listening. We'll be back on Monday.