The Future of Retail: Why Analog Experiences are Making a Comeback

We're starting to get a little fatigued. And so you're seeing sports, concerts, going to stores, rising slowly but surely. You see weird numbers like vinyl records had its biggest sales in like 30 years. Some people here might have been part of the group where this last Christmas we tracked over 20,000 social media posts. where a 12 to 14 year old asked for an analog phone instead of a smartphone. Gen Alpha

Gen Z and they don't want to be like that. Gen Alpha does see it two ways. One, they think their older siblings are entitled and soft, which is probably a good thing for the future, but they're also more cynical to technology. And I think that in incredibly bullish analog, I'm incredibly bullish the real world. But just because that macro trend is happening, we still have a lot of work to do. This is the Gary B audio experience.

For starters, Gary, I am so thrilled. You are a busy guy. If you follow Gary, you guys know Gary's out and about, he's everywhere. I am so grateful that you thought it was important enough to come to Orlando with Our field leaders and everybody here that is the heartbeat of Ulta Beauty to talk to us.

a few minutes just about you, about leadership, also about what you're seeing in retail. I think one thing that I've had the pleasure of getting to know you is I know you believe what we believe, which is business is about people and people power business. So I'm just really excited, kinda dive in. It's just me, you and me, like normal. Maybe t two thousand of our closest friends. Like does that matter? You cool though? Wait, we have whistles? Yes!

And bells, oh my god. This is gonna be a morning. Thank you. Thank you so much for having me. Awesome. Well what I wanted to do is just uh for the for for our friends here. Yep. Talk to us about how Gary became Gary. You have quite a story, and I think it's really fascinating. Well I'm you know it's actually fun to answer this given that the agency that we just started, the partnership we just started.

Tamar is actually named after my mother. Um Gary is Gary on the back of the world's single greatest mother. Um I was born in the Soviet Union and immigrated to the US when I was three. You know, it's it's it's really amazing to be in a point of your career where you're getting all these accolades. Such a nice warm welcome. Um but the reality is is that I'm just the vessel, meaning all the cheering, all the accolades.

A huge indication of my mom, right? I am the byproduct of her. You know, she You know, my mother, you know, modern parenting is very I know a lot of us are going through it. What my mom did that I think is so important I was fully capable of absolutely. But what she did that I think has been a lost art is when I got out of pocket or I messed up She didn't play around. Ha ha ha. My kids are in the audience right now. Okay, anyone relate to this?

You know, Kelly, it's really real though. Like, you know, and and really it's funny, especially with so many you know, I was a I was a store manager. I ran a store for twenty. And finding that balance of really loving your employees and making them feel like it's a little bit more than a job. But finding that fine line where you can hold them accountable was impossibly hard. I was a 20-year-old doing that with the employees that were my friends.

out of work. So I have a lot of empathy and compassion of everyone in this room trying to find that balance. But I'm a classic immigrant story, right? Other than I was a terrible Like all the other kids that came from Russia were getting A's and going to Harvard. I was getting D's and F's. But that's What does mom feel about that?

Gary Well she punished me every four rapport cards. I mean you know two you know back in the you know now kids don't get grounded or anything. Back in the day, like two weeks No friends, no outside, no Nintendo, no TV. Is this why you got so curious? Is this the secret? No, it's how I've become so grateful. Um because because Mm-hmm. When you're in jail for two weeks. When you get out, you're thrilled.

And then again, and I feel like a lot of people here can resonate, you know, not only was I grounded and I had to eat it, this is how I became accountable, if I even, I was hell, I was scared to even think. Forget about disrespecting her. And I have a I have a f funny feeling feeling the vibes, some of you know. If I even Disrespecting her, my face would tweak just a little. And this was the 80s. My mom would smack my face.

So anyway, I think, you know and then and then at fourteen, you know, so I was getting D's and Fs, but I was getting D's in that. And entrepreneurship and business is cool now. Some of you that grew up in the 70s, 80s, 90s know it wasn't as real back then. The word wasn't running around. We didn't think about kids as whiz kids making money back then.

I was getting D's and F's, but at 14 I was making a thousand dollars a weekend selling baseball cards in the malls of New Jersey. And I don't know about you guys, but at fourteen I had like six $15,000 in cash under my bed. And when you're 14 and you have 17 racks under your bed. and you're not selling weed, you're doing a good job. Thank you. So now But then but then back to retail then my life took a crazy turn. I'm making a thousand a weekend at 14. I'm like living

And now all of a sudden 14th birthday, oldest son, only child that was born in the old country. My dad went from being a stock boy in a liquor store making two bucks an For nine years, we w I went on one family vacation. But didn't stay at the nice high, it stayed at the holiday. My family didn't believe in credit cards because we were immigrants. My mom ran out of cash on the third day of a seven day disaster.

So, you know, we I got very fortunate. I talk about this all the time. What is who am I? What is it? How is it? When when you are built on gratitude because you understand and this is the Outside of health, I wish on everyone to be born into a family. but has nothing but love because by the time you're seven and eight. By the time by the time you're seven or eight, you know that money isn't the gateway to happiness. It changes your relationship with money. think that money changes the outcome.

If you're in a bad place, money's gonna put you in a Money is the great excess. And so at 14 my life took a hard turn. I went from making all that money to now I have to work in my dad's. I get paid two bucks. I'm in the basement of the liquor store bagging. Kelly, did you see Goonies? How many people here by show of hands have seen Goonies? From 14 to 16, I was sloth. I was.

I was literally chained to the basement of my father's liquor store, making 20 bucks a day bagging ice. At 16, I was finally allowed upstairs. And then really live the life that I so associate with all of you. Stocking shelves, watching customers. So much came natural to me that wasn't taught. I would watch how customers would walk through the store.

I would think about end caps and merchandising when I didn't even know what that word was or even had heard of it. And um I I will tell you that everything In my professional Was learned in a retail store so much so that the number one piece of advice that I give to so many of my friends that have. I actually genuinely believe that everybody should I love that. More more bells.

This is the store that you turned in. You you made it three million it went from three million Is that right? That's right. By the way, I was pretty upset. I don't think you guys cheered enough when she said that. I have a funny feeling if anybody here twenty X the retail store, good shit would happen. Yeah. How'd you do it? What was the secret? So many things. I you know, I love my dad with my whole heart and you've you've met my parents. You know my relationship.

My father managed his store before I got there like a soap. If you don't know what that means, my parents grew up in the Soviet Union. Communism is there's a reason people are scared of socialism and communism. It's scary. And what I mean by that is Lived in fear until they were And one of the things that happened, I don't know if you know this, but the government I owned everything. How does a black market?

Everyone steals all the time. So my father grew up in an environment where everyone stole I lived forty-five minutes from the first time. My dad is the opposite of me in a lot of ways, and one of them is I talk all We drove this is the first day I've worked. We drive forty This is the first day I ever worked for my father. This man doesn't say a damn word to me. I can't imagine that game. Doesn't say a word.

We pull up to the store. We park. He turns to me. Back to another movie reference. Did anybody see Rocky IV with Drago? My father's accent is like draga. He literally, I'm 14. He turns and looks at me and he goes, keep an eye on the employees. They steal. That was the culture of my dad's store. Now now I come along.

So I'm my mother's son. It's all rainbows and sunshines. It's all love. It's all warmth. And the way I built that business was I mean it as like a fifteen, sixteen and really when I really started. My number one job in life today as a personal brand, The post I just posted on Instagram in the green room. I as a leader for my six thousand employees, you know, across all my companies. My number one job when I woke up.

I I believe the world is in a very Companies Most leaders on earth parents leaders on earth. to keep people on And so So so first I just made people feel like the people that own the liquor They started 11 in five fifty an hour which was Jersey's minimum wage. As I built that to a couple hundred people, everybody felt You know I want it on the other. You know, we were in a fun category similar to yours, which was people would come in for a a product. but we have the ability.

Who drinks Santa Margarita Pinot Grigio in here? Raise your hands. Santa Margarita Pinot Grigio? Cool. For the nine of you, stop drinking, it's overpriced. Overpriced. Overpriced. And so people would come in and be like, I want Santa Margarita Pinogrigia or Kendall Jackson. or as the years evolved, yellowtail or the rose of the moment. Right now everyone's drinking too much Sanse or all that crap, you know? And I would have the ability to be like, hey, try this. And we want it through trust.

is the opportunity at the store level to recommend some that might be better for that employee if you're educated enough if for that consumer excuse me, if you're educated enough to know what they're looking for and what is a better option. God willing It's game over. That costs them. You win forever. And you know this as a marketer. Right. Like our number one

when you first met me was Hey everybody, uh hope you're enjoying the podcast right now. Make sure you follow the podcast. That's why I'm interrupting. Let's keep going on this show, but follow the podcast. It'll make my mom super happy. And that's always happening. And so we won ultimately on love and trust. And when you start to play love and trust to Which are very weird and delicious. And the more retention you have in a store.

a customer trusts and feels like you give a crap, the more likely they will go to you versus the competitor. Well I have a question. Yeah.

I have a question about that, Gary, because how do you love how do you create this environment of love? Sometimes people don't always Yeah, look, I'm not Mother Theresa. First of all you first of all and this is actually actually this The first way you actually build love and trust before we even get Yes. Little bit more. I'm gonna I'm gonna say something pretty important. I hope this There are times because of the PL, because of the reality of the first time.

that I'm not able to go to the place that I want to emotionally. And if that is true, then I don't is saying something that they don't have control It's important. Like I'm empathetic, right? Like you obviously anybody in this auditorium is quite senior, but unlike my I have no board. I'm not publicly When I make mistakes and decisions, when I make a mistake Here, you know, just like so many of the people. I always think that's a good thing.

your ability to make them But if it's a decision you can Because you will lose trust when you say things like And then that person gets fired. Yeah. Well then everybody else is like, you don't have any. And so I think first it's about managing your word.

versus what your own ego or your kindness of your heart wishes you could. So you need to be very disciplined And then as far as what bro listen, I have so much love and warmth and want it all kumbaya and team, there's no question throughout my career there's been pockets where I've created entitlement. and NEPO DNA and our corporation has changed once we stood up a term called kind candor. You know, candor is important. You know, I my greatest weakness

But once you work for me, like by the third day, I'm like, we're family, right? Like I go into that mode. You do that to your clients too, by the way. I do. I d I just don't know any other way. I was again raised by a mother like everything was stranger. were treated like failure. Strangers. Amazing. I don't know anything else. Like everything else is foreign to me. I could give a crap about how much money you have or followers you have or status you have.

Like, I just love people, so I can't help it. But there are ramifications where when in my 20s, 30s, and even into my 40s, If I loved you, it was hard for me to tell you the full truth because I was scared to scare you. I thought me telling you that you're not doing a good job. And would lead to you like leaving the office and being petrified and going to LinkedIn and start to update your profile. You know? I and and I I everything that has been bad in my personal and professional life.

has been completely predicated on the inability to be candorous with some But over the five last five or six years, you know, this is what's great about growing up. Along the way you fix things, you can get better. And I would I could not Implore more of you that also have a bleeding heart and maybe struggle with critical feedback. This term kind candor really worked. There's a way to deliver. Critical, even negative feedback, with grace and empathy and and it's really worth

I really appreciate that. Yes, they all can relate. It's hard. And again, this is what's so great of 20 years in retail. It's especially hard for this crib. It's it's one thing when you when your direct reports make hundreds and hundreds of thousands of dollars in corporate and they're professional.

You know, you start going into hourly wages, you know, some people are young, other people are like, you know, you know what's going, you know, do you know how hard it is? Let me phrase, this room knows how hard it is when they know what that person's dealing with at home.

Right, it's really tough to be a hard ass right when you're in the person in your that your that works in your stores late for twenty minutes because they have a really screwed up situation at home and they had to take care of their daughter. Like it it's a very challenging emotional thing. And I I will pick kindness over P L every day. Woo! Alright.

Okay, are you ready to shift some gears? All right. We're gonna change some gears. We can't have Gary Vaynerchuk on the stage and not talk about where the heck we think retail is going, am I right? Okay, so you are widely considered as one of the top thinkers across a lot of different industries. You are most definitely an innovator and the original, you know, creator. I would even say the OG creator, right?

So I wanna ask, as you have all of us, all two twenty five hundred people here in the room that are focused every single day on on running a retail business, where do you think retail? I think it's going to actually very good place. I'm so glad I get to answer this question now instead of five years ago where I was like, uh A couple things that stand out to me. One, as as AI continues to explode, and it will. I think we're going into a very unique era.

human behavior. I think in the next twenty four to thirty six months. It won't be twenty twenty nine. It'll feel more like twenty fifth. I think it's going to accelerate very quickly with where we're going with technology. But ironically, and I think some of you are probably already starting to feel this, as we go more 2050, I'm also seeing the emergence of 19. Let me explain what I mean by that. I think the world of retail is going very barbass. I think we're going to go very extreme with AI.

I think every store within a decade is gonna be a studio for content and live shopping. I think there's so many cool things, experiential, right? I I think the store's gonna evolve into giving people more reason to come. So I think we'll go there. But what's really exciting is you can already see it. Humans are starting the first indications. starting to mitigate their digital focus. We're starting to get a little fatigued. And so you're seeing sports, concerts,

Going to stores, rising slowly but surely. And I think that you you see weird numbers like vinyl records had its biggest sales in like 30 years. Some people here might have been part of the group where this last Christmas We we tracked over twenty thousand social media posts where a twelve to fourteen year old asked for an analog phone instead of a smartphone. Gen Alpha These Gen Z, these 12, 13, 14 year olds see their older siblings and they don't want to be like that.

And so Yeah, let's clap it up for shitting on Gen Z. Thank you. I think it's a good thing. They liked that one. Some of'em lead a few Gen Zs in the audience. Yeah, and I and you know what's funny? J I I do study early consumer behavior. Gen Alpha does see it two ways. One, they think their older siblings are entitled and soft.

Which is probably a good thing for the future. Um and there's plenty of Gen Z people that are gangster. I mean, uh my company's loaded with Gen Z that are gangsters. And by the way, on the record, on the record, I grew up with tons of boomers that were lazy as hell. Um But they're also more cynical to technology. Most of us grew up

looking at the crowd where the advent of whether it was the internet or the iPhone, these were remarkable technologies and did bring incredible change and good things. But everything in life is about And I think that You know, l you know this, I'm starting a new startup that is a retail store. Yes. I'm incredibly bullish analog. I'm incredibly bullish the real world. I think there's a lot of interesting stuff. But just cause that macro trend is happening. Thank you.

We still have a lot of work to do.

here as a group to actually execute operationally to bring those experiences or value in the store. But I'm very bullish. I'm also completely obsessed with live shopping, as you know. The QBCation of social media is here. I'm sure you're paying attention given the business you're in. And that's another thing I'm paying a lot at. So is it the blend I mean we have sixteen hundred stores across the United States and so what I hear you saying is that Bells for that. Yeah. We like to say this is a

By the way, I'm sorry to interrupt you. I'm definitely getting bells in my office. Yeah. I like that. Go ahead. So what I hear you say is that we have an opportunity, maybe as Ulta Beauty, to think about our stores as a way to bring social media to life. Yes. Is that a way to think about that?

Yeah, I mean I think you know, as you know we're talking a lot about this, me you and I. Yes, I mean I think there's so much talent in the stores. I know that you've started to roll out some programs on this. Yeah, I mean I think I think within the decade. Y'all at the C-suite will start looking at the footprint and reallocating some of the selling space to some version of experiential space, whether that's a live shopping studio, whether that's

You know, I I anticipate this company going more into overall wellness because you can just see wellness and beauty colliding. So, you know Yeah. Um Yeah, I just I just think it's about experien I mean I'd I'd love to see my old world bled into. Like I think you guys could crush wine night on Thursdays in the store. That's a winner. Thank you. Prom Prom's I'm I'm obsessed with prom. Um There was a prom, as a matter of fact there was a prom going on here at this hotel the day I came home Yes.

I I just I'm thinking a lot about, you know, as we start to strategize, what can we own? Like own. Like how do we just below it? Like instead of like incremental like oh let's do like how do we jump nine steps? Always come to Ulta Beauty for this. Yeah, I think prom is like just like Let's just convince the entire culture that they have to visit us during that time of the year. Which is nice'cause it's a good spring season you know, it's not Q four when it's crazy, so

You know, I think there's a lot of ways to come up with reasons to come to the stores. You have such a massive footprint. But I think being a place where you just come to buy something and leave That's a thing of the past. Yep. I think we need to start getting really thoughtful of like why would they come instead of just swiping something here? And I think we have the ability to transform

with our partnership, I think we can comms that, we can market that, we can let the whole world know. I think with this incredible, you know, team in place, if we set the strategy properly, executing that over the next twelve to forty eight months feels exciting and I'm I mean we're here for it, aren't we? We are.

Well on that note, I have a question. I have one more question before we get into light. And that is you do have and you described your how you got your start. These are operators, these are entrepreneurs. And these are leaders that are driving results every single day. They are not only making sure that everything is merchandised well and they are stacking the shelves just like you talked about, but they're bringing that guest experience to life. And I think

That's what makes the magic of the industry that we're in in beauty. It's so emotional and it takes us It just takes this touch, you know, that keeps the customer coming back. So what piece of advice? I mean, you built a whole career on this. What piece of advice do you have for them? I have I have one real big one and this is like fun to have both. Everyone that's in the trenches and corporate in the same building. So I wanna make sure everyone's paying attention.

Yeah. The biggest reason I'm happy in life is one, I view life very central As long as my family is healthy, literally nothing else matters. So that level of simplicity. But after that, which is really something I highly recommend everybody get into mentally. Why? I don't know. Hopefully we continue to stay healthy for a little bit. I do not cry about things I can't control. The number one piece of advice I have for this room is you can only control what you control. Right.

It's this is important. Look, I think it's awesome for you and your direct report or your boss to grab a coffee and crap all over corporate because you're frustrated with them about something. Never, never happens, right? Where the bell's at? Ha ha ha ha ha! But I really do think that empathy is one of the great gifts if you have it. I'm sure this is not lost on anyone. Corporate is not trying to make it challenging. They just are dealing with what they're dealing with.

I think one of the great mistakes that regional or general managers make in organizations is they get so caught up in what they can't control. It's the biggest issue in society right now. Everyone's pontificating about global politics as if they know something. Thank you. Your life, let alone your career, gets a hell of a lot better when you focus everything on what you can actually control versus spending all of your time talking about what you don't control. Woo! That's a mic clap.

Yeah, and with and and with with all due respect, you were right about everything they are, but they are not entrepreneurs. They may be entrepreneurial. Right? You're entrepreneurial and that's amazing, but they don't have the gift and the curse of what entrepreneurship is. The gift is you're fully in control, 100%. of everything that is wrong in my companies is one hundred percent my fault. The problem is

When you're not fully in control, you also have to deal with that energy. And I'm empathetic to that, but you can't control anything besides your decisions and your day-to-day. If you're so If you're so frustrated about something and you're so unstoppable and awesome, Quit and go start a beauty store. And on that note... Ha ha ha! Or maybe we like to have direct Come on, Cal. We're getting real. It's early in Orlando.

The gr I'm gonna le I'm gonna end with this on this point before we go into speed round. I just have one question for Pete. I can't wait. Grace. You need to give grace to the people around you, most of all often the people above. You won't be able to give corporate or Kelly or anybody else grace unless you start with giving yourself grace.

So I I have a funny feeling based on the energy, based on the homework I've done in this company over the last three or four years, this is a remarkable room. You're just a human. You're trying. And uh giving yourself more grace will allow you to give people more grace around you, the people that work for you, the people above you that are trying to make it happen, the people to the side of you. And so grace is an important word, and I hope you start going down that path.

What a way to end. It's amazing, Gary. Thank you. Okay. This is the final question, Karen. The speed round final question. Yes, we're gonna speed it up. Understood. Pinot or Keb? Ha ha ha. Um This is insane. I'm a everybody if you enjoyed this podcast, please go back and look at the prior episodes. They're loaded. I appreciate your attention and uh thanks for being part of this journey.