Vitamin Shoppe's Andy Laudato on AI-Powered Shopping, GLP-1s & "Stop Starting, Start Finishing" | Live from Paris
Live from the Vusion Podcast Studio at NRF Retail's Big Show Europe in Paris, Omni Talk's Chris Walton sits down with Andy Laudato, EVP and COO of The Vitamin Shoppe, for a deep dive into AI, assortment, and operating discipline.
Andy walks through Shop Advisor, The Vitamin Shoppe's new AI-powered discovery tool built on the company's own proprietary product data, and shares his read on where AI is really working across retail right now as co-founder and chair of the Retail AI Council. He also breaks down how GLP-1 medications are reshaping assortment and education, and the prioritization rules that keep his team focused.
In this episode:
- Inside Shop Advisor and The Vitamin Shoppe's AI innovation store
- Why "human in the middle" AI applications are winning right now
- The mission behind the Retail AI Council
- How GLP-1s are reshaping assortment and customer education
- Andy's rule: cut every list by 15% and "stop starting, start finishing"
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Transcript
Hello, everyone.
Speaker A:This is Omnitalk Retail.
Speaker A:I'm Chris Walton, and I'm coming to you once again from the Vusgen podcast studio at booth number 043 at NRF Retail's big show, Europe in fabulous Paris.
Speaker A:Andy, you like Paris?
Speaker B:Yeah.
Speaker B:First time here?
Speaker B:Thrilled to be here.
Speaker A:First time here.
Speaker B:Yes.
Speaker B:Wow.
Speaker A:Wow.
Speaker A:So, without further ado, I want to introduce Andy Lodato.
Speaker A:Andy is the EVP and COO at Vitamin Shop.
Speaker A:He's been on our show before.
Speaker A:It's been a couple years since we've had you on, though, right?
Speaker B:That's right, yeah.
Speaker A:So how are you finding Paris?
Speaker A:You just got off stage as well.
Speaker B:Yeah.
Speaker B:Well, look, there's a lot to do here, A lot of good food, a lot of interesting people to meet.
Speaker B:So off to a good start.
Speaker A:Right?
Speaker A:Right.
Speaker A:Well, it's great to see you again.
Speaker A:So what.
Speaker A:What brought you to this show and what brought you to Paris for the first time?
Speaker B:You know, as retailers, I mean, I've always believed, and I think you do.
Speaker B:That's why you do this.
Speaker B:We all can learn from each other.
Speaker B:So getting out and meeting international people, there's new ideas, new things.
Speaker B:There's some areas where people in Europe are ahead of what we're doing in the US and so getting some inspiration from them is a big reason why I'm here.
Speaker A:So is that why to put kind of your global hat on your job?
Speaker B:Y.
Speaker B:Exactly.
Speaker A:Yeah.
Speaker B:Yeah.
Speaker A:So I'm curious, Andy, because your job coo, now, your background is really in tech for the most part, and your purview SEO is still expand.
Speaker A:Covers technology as well as the other traditional areas of a coo.
Speaker A:What are the puts and takes with that type of organizational structure?
Speaker A:Like, what does it work well for you to do, for you to accomplish in your job, and where does it maybe make things a little more challenging at times?
Speaker B:Yeah, look, I have to get angry at myself a lot.
Speaker B:Right.
Speaker B:You know, it feels like the demands of the customer are a little ridiculous.
Speaker B:As a business owner, I'm really frustrated.
Speaker B:It takes so long to get something done.
Speaker A:Right.
Speaker A:Right.
Speaker B:So, of course, obviously, strive to find balance, to make sure we can move really quickly but still do things right.
Speaker A:Do you have any tips or tricks for how to do that successfully for those listening?
Speaker B:Yeah, I think it's about aggressive, unrelenting prioritization.
Speaker A:Prioritization.
Speaker B:You only have one number one, and you should put all your best people and all your best effort on whatever is number one.
Speaker B:So one of my slogans is stop starting and start finishing.
Speaker A:Okay.
Speaker A:Stop Starting and start finishing.
Speaker A:I like that.
Speaker A:I might borrow that.
Speaker A:Do you have a list of or do you have a rule that you generally follow in terms of the number of priorities you can have at any one time, or is it kind of a moving target?
Speaker B:I always tell people, take whatever your list is and reduce it by 15%.
Speaker A:15%?
Speaker B:Yeah.
Speaker B:So have you heard the term WIP?
Speaker B:Work in progress?
Speaker A:Yeah.
Speaker B:Yeah.
Speaker B:Everyone's got so many things, so people get.
Speaker B:People love starting things.
Speaker B:We'll get a kickoff and meeting and a demo.
Speaker B:And I really try to push people to not do that.
Speaker B:You know, stay focused on getting something done and then start the next thing.
Speaker A:Yeah, yeah.
Speaker A:Why 15%?
Speaker B:It's just a rule of thumb.
Speaker B:Because I feel like everyone's list is too big.
Speaker A:Yeah.
Speaker B:If I cut the list in half, people would lose their minds.
Speaker A:Right.
Speaker A:Oh, that's why.
Speaker A:Yeah, I was like 15.
Speaker A:That doesn't seem like that much, you know, but it was really drastic.
Speaker A:You kill people just go nuts.
Speaker B:Yeah, yeah.
Speaker A:Right.
Speaker B:Seems to work.
Speaker A:That's funny.
Speaker A:That's funny.
Speaker A:All right, so one of the things you just launched, you just launched a new AI powered discovery tool in one of your New York innovation, your New York innovation store.
Speaker A:I'd love to hear more about the store and the tool.
Speaker B:Yeah.
Speaker B:So we opened a store on 86th street in Lexington and Upper east side.
Speaker B:And it's an innovation store.
Speaker B:And one of the things there, I mean, it's a very complex category of the micro Shop mineral supplements.
Speaker B:And everybody's on their own health journey.
Speaker B:Right.
Speaker B:We all are.
Speaker B:And so the idea is not to replace our store employees, which we call health enthusiasts, is to embrace them, empower them, to give them more data.
Speaker B:So we already spend a lot of time, money and effort educating people, but with Shop Advisor puts another tool in their hand.
Speaker B:So even though it's customer facing, the way we train it, the way it's used, is the store associate brings the customer to that tool.
Speaker A:Okay.
Speaker B:And it has even more data on the supplements, the articles.
Speaker B:And behind that tool is our own proprietary library.
Speaker B:So we're not just taking LLM info, which is and can be wrong.
Speaker A:Right, right.
Speaker B:So empowering that with data that we can trust so we can have accurate and up to date information for our consumers.
Speaker A:Got it.
Speaker A:And when you say bring the bring, you bring your customer in store to that tool, what does that actually look like in practice?
Speaker A:Like, how are they using the tool?
Speaker B:Yeah, well, in that store, it's a big, flat touchscreen.
Speaker A:It's a flat touchscreen.
Speaker A:Yeah.
Speaker B:So you walk over to it and you can.
Speaker B:With predetermined questions, you know, I want to sleep better, I want to run faster.
Speaker B:Or you can just type in any question like a standard LLM.
Speaker A:Got it.
Speaker B:We are going to bring that to every store via the iPads.
Speaker A:Via the iPad, yeah, we're working on.
Speaker B:That as a big next step.
Speaker A:Got it.
Speaker A:So the sales associate engages the customer, brings them over there, starts that journey with them, and takes them through how to use the tool to get the information that they want on their wellness journey.
Speaker B:Exactly.
Speaker A:That's the best way to think about it.
Speaker B:The other thing is that tool has knowledge of that particular store's inventory.
Speaker B:So because it'd be really frustrating if it recommended something and then we go, oh, that's out of stock today, right?
Speaker B:Yeah.
Speaker A:So that's filtered out beforehand in terms of the recommendation.
Speaker B:Not that we'd ever be out of stock.
Speaker B:No right way.
Speaker B:No.
Speaker A:You're the coo.
Speaker A:You can't be out of stock.
Speaker A:No, no, not at all.
Speaker A:You're also the chair of the Retail AI Council.
Speaker A:What led you to what?
Speaker A:The chair and one of the founders.
Speaker A:What led you to found that and what are the opportunities you see in regards to AI across the industry?
Speaker B:I mean, AI.
Speaker B:I can't believe we went five minutes without talking.
Speaker A:Right, I know.
Speaker B:Right.
Speaker B:So.
Speaker A:Well, you already talked about it with the tools.
Speaker A:You kind of talked about it a little bit.
Speaker B:So the retail AI counselor are mission is education.
Speaker A:Yeah.
Speaker B:It's really to separate what's real, what's experimental, what's going on.
Speaker B:So we are a group of retailers, live by retail, funded by retail.
Speaker A:Okay.
Speaker B:But we embrace the vendor partners because we're all going to build this together.
Speaker B:But yeah, the entire point is to say what's working and together we're better.
Speaker B:And as an industry, we believe we can all move more quickly and faster and better by learning from each other as we go.
Speaker A:Are there any particular.
Speaker A:This is always a question I get asked a lot.
Speaker A:Are there any particular areas where you see AI particularly working well inside of the retail organizations across the industry?
Speaker A:Not necessarily just at Vitamin Shop, but I mean, something that works for everybody.
Speaker B:Old school AI, you know, the OG machine learning.
Speaker A:Right.
Speaker B:For inventory forecasting.
Speaker B:That stuff's rock solid.
Speaker A:Right.
Speaker B:So if we want to start talking about LLMs, I think human in the middle applications are best.
Speaker A:Human in the middle applications.
Speaker A:Okay.
Speaker A:What's an example?
Speaker B:Shop Advisor would be an example.
Speaker B:Customer care, where you're empowering, you're not replacing the agent, but you're Empowering the.
Speaker A:Agent, giving them information, all kinds of data.
Speaker B:Right.
Speaker B:So I think right now we're at that human getting enhanced information quickly and then presenting that to the customer.
Speaker A:And that's applicable almost across every stream or strata of the organization too, right?
Speaker B:I mean, I think so.
Speaker B:For us, we're people first, Oregon, you know, so.
Speaker B:Yeah, absolutely.
Speaker B:Yeah.
Speaker A:Okay, got it.
Speaker A:All right.
Speaker A:So one question I wanted to ask you, it's very top of mind right now is GLP1s.
Speaker A:But I want to ask it of you specifically because I'm curious.
Speaker A:From the chair top which you sit, GLP1S is definitely having an impact on Vitamin Shop, I have to think to some degree.
Speaker A:But I'm curious how it's changing your day to day job.
Speaker A:What are you having to do now because of that trend that you weren't having to do before?
Speaker B:I don't know if it's different.
Speaker B:It's assortment.
Speaker A:Okay.
Speaker B:So people on a GLP1 need protein and maybe they don't want to eat a big steak because they're nauseous.
Speaker B:So protein powders, protein drinks, fiber is really important.
Speaker B:So that's actually a category that's increasing in the importance of fiber and then things for nausea.
Speaker B:So for us, it's about supplementation to help these people successfully lose weight without losing muscle.
Speaker B:And then if people are losing weight, then they want to start working out, enjoying the gym, and then we can help them through that.
Speaker B:Right.
Speaker B:So it's a journey.
Speaker B:And again, everyone's on their own personal health journey, all of us.
Speaker B:So if they're at that stage where they're on a GLP1 and they want to supplement protein, you don't need to, then we're the perfect place for that.
Speaker A:So you're kind of saying, don't overthink it.
Speaker A:From an assortment perspective, it's just about portfolio optimization, balancing the floor with the things that they want on the shelf or online.
Speaker A:That's basically what you're saying.
Speaker B:Yeah, it's a basic supply and demand,.
Speaker A:Basic blocking and taxing.
Speaker B:What we do so well is education.
Speaker A:Yeah.
Speaker B:So people may come in and say, I've just started this, or I started it and I have these issues or these needs.
Speaker B:So making sure that we've trained and we do that, our health enthusiasts, so they can have that conversation with the customer.
Speaker A:Got it.
Speaker A:So it's assortment.
Speaker A:It's also training.
Speaker A:Is it also product attribution too?
Speaker A:Going back to what we talked about earlier, too, in terms of making sure that data quality is up to standard across all Those items so you can serve them up, whether it's through the AI tool, the.
Speaker A:Or through the conversations the sales associates are having with the guests, both online and in store.
Speaker B:You're absolutely right.
Speaker B:This is bigger than the GLP1.
Speaker B:It's on every category.
Speaker B:Creatine is really popular right now.
Speaker B:So people ask, should I take creatine?
Speaker B:Isn't that just for bodybuilders?
Speaker B:And creatine is for everyone.
Speaker B:But that education is another example.
Speaker A:Yeah, I'm big into the creatine gummies right now.
Speaker B:Yeah, well, you only need five.
Speaker B:What?
Speaker B:Milligrams.
Speaker A:Yeah, five milligrams.
Speaker A:Yeah, yeah, I got like six of them in my bag.
Speaker B:Don't OD on this trip.
Speaker A:Yeah, no, it's great.
Speaker A:It's great.
Speaker A:No, I know.
Speaker A:They're like candy.
Speaker A:It's crazy.
Speaker A:All right, well, let's get you out of here on this.
Speaker A:I'm curious because I see you at a lot of shows.
Speaker A:You know, that's why we've interviewed in the past.
Speaker A:I feel like I bump into you quite often.
Speaker A:I'm curious, as you look across the landscape over the past year, all the different conferences you've attended, is there one trend that you think is maybe overhyped or maybe even vice versa under hyped that maybe the retail industry should be paying more or even less attention to?
Speaker B:Yeah, I mean, I always go back to fundamentals, so there's always a lot of flash and pizzazz, but getting your inventory right, getting your stores right, those are the things I think that people don't think about enough.
Speaker A:Yeah.
Speaker B:And when you do it well, hopefully nobody notices, but.
Speaker B:Yeah, you know, as much as I've been at this, just back to fundamentals and block and tackle, retailing are what the winners do.
Speaker A:Got it.
Speaker A:So there's.
Speaker A:There can be a lot of distractions at these shows then.
Speaker A:Yeah, yeah, yeah, yeah, yeah.
Speaker A:Is there anything that you found that particularly helps, you know, any trends or technologies that you're finding help people do that?
Speaker A:Blocking and tacking.
Speaker A:Better day in and day out.
Speaker B:Inventory management.
Speaker A:Inventory management.
Speaker A:You got to invest in inventory management.
Speaker B:I mean, what are the biggest costs of retail?
Speaker B:Your rent is pretty fixed.
Speaker B:Your labor, which is also kind of pretty fixed, and then your inventory.
Speaker B:And so got a hunch by a bunch.
Speaker B:Right.
Speaker B:We can't do that anymore.
Speaker B:You got to use data analytics and manage inventory.
Speaker A:Well, I've never heard that.
Speaker A:Got a hunch by a bunch.
Speaker A:I've never heard that.
Speaker A:Oh, my God, that's so great.
Speaker A:Oh, man.
Speaker A:On that note.
Speaker A:Well, on a hunch.
Speaker A:Gotta buy a bunch.
Speaker A:Hopefully you got a hunch you're gonna watch this a bunch, too.
Speaker A:Well, thank you, Andy, for joining us today.
Speaker A:Thank you to Vuzion for sponsoring all of our coverage here from NRF Europe in Paris.
Speaker A:And as always, everyone out there, be careful out there.
