Bob Phibbs: What’s the Secret to Retail Success in the Age of AI and Human Connection?

Welcome to Media Minds with your host, David Wolf.

Joining us on this segment is Bob Phipps, a retail doctor, the retail doctor. You're the power of voice in your own right around all things retail, Bob. He's a retail consultant, a keynote speaker, a trainer with more than 30 years in the industry and experience in 17 countries. Oh my goodness. When I saw that, I was like, hello. You've trained more than 250,000 retail associates. You've got a CSP designation. And interestingly, and we'll unpack all of this, you publish a weekly newsletter to roughly 100,000 or so retail owners and managers. You're also the author of The Sales Floor Problem and the creator— and this is fascinating, I also want to unpack this, Bob— the SalesRx Plus, which is actually an AI-powered retail sales training platform. And there, there's the book. And we're going to unpack the AI part because I'm leaning heavily into AI as well these days, Bob. And, and along with that, Sidekick Rex, which is the AI roleplay coach. Again, I'm all about this stuff and we're looking at developing these sorts of things as well. So I'm really looking forward to this conversation. Bob, welcome to the program.

Thank you very much. I'm proud to be here, David.

Oh, good, good, good, good. No, it's great to have you. We've been working together. You've been working with our team on your own podcast and sort of content For a few years now, I think, and, and we're grateful. I wanted to ask the broadest question because you speak and consult on what separates retailers who grow from those who actually close deals. What, what is the separation there? How do you think about that?

It's really simple. Those who understand that training is where the Achilles heel is of retail, and they train like every day and they try to find another way to keep somebody's mind engaged. Those are the winners, the ones who are falling are the ones who look at training as something that I did. It was a box to check. We onboarded it, or we now have AI. So they had AI, you know, teach them everything. And retail is a business of people-to-people human connection. And as much as AI is great for the backend, don't get me wrong, I use AI an awful lot. The reality is that that's, you know, trying to bring more and more of that to the sales floor, I think, basically is making an online retailer into your store. And that's dangerous because I go online to buy, right? So my, my printer goes down and I need an HP 64 cartridge. I don't have to go down to the office supply store and have them use the sacred scrunchie to unlock the sacred cartridge display and get my $30 cartridge. I'll just buy it from Amazon, right? So that's easy. But if I go into your office supply and I have to ask the sacred scrunchie person to unlock the sacred cartridge, woe to you to think that's all I'm there for. Because I came into the place and the logical question to ask is, would you, you know, do you need, what are you using to print this with? Could you use some paper? Of course, that little bit, the money is in the second item. And so, so many retailers have missed that, you know, that it takes so much money to get them in the door that anything you can get out the door is sacred. So, you know, I look at the average sale, the average number of items going out the door. If it's like 1.1 point, you're a clerk, you're waiting for me to come up and say, oh, please, will you bring me up the sacred cartridge? And that's not fun. You know, people buy from people who make them feel that they matter. And it's that simple. So the You know, the thesis of this new CEO briefing is really how many sales that walked out your front doors left empty-handed and how many of your crew cared. And multiply that times 52 weeks a year. And until the retailer understands that, I think that you're whistling past a graveyard and saying, oh, it's all Amazon. Oh, you can't get good people. No. You can train anyone.

So you went from working in retail on floors of brick-and-mortar retail operations, and I'm guessing you just observed that there was just a lot of slippage. And, and it sounds like this is all about training, about a CEO or an owner of a retail operation. They need to understand that this is— they're not hiring clerks, as you mentioned. They're really— they're hiring consultants. that can help engage people on their floor and move it to the next level if possible, if the particular customer's open to that. Is that, is that how you think about it, Bob?

Yeah, I do. Because let's face it, the good ones all have a job right now. So you're going to have to make people and you're going to have to bring them up and bring them along. And, you know, I got the highest increase of sales, South Coast Plaza, number one mall in the world. And so the owner came down to me. He's like, what are you doing down here? You're like beating the pants off of Tiffany's and Nordstrom and all these other people. I go, it doesn't matter what I'm selling. It doesn't matter what I'm selling. It's like either you understand how people want to be sold to or you don't. And I was selling cowboy clothes in Los Angeles in the '80s and early '90s. And if you had asked me, did I see that was my life ambition or think that would take me anywhere, I would have told you no. But it's because of that company and the question they asked in a regional meeting, which was, What's a company's greatest asset? And I said, oh, it's employees. And they go, wrong. And I was like, wow, wrong. Okay. So there's like 60 people going around. No one gets it right. So finally the owner goes, it's customers. And I was like, oh yes. Oh yes. I'm like, bullshit. This isn't right. Is that allowed to say that on your podcast?

Yeah, you can say whatever you want.

Okay.

Absolutely. We're real here.

So I went down to his office afterward and I said, we built this company on Employees who were well trained and were rewarded for doing what we're doing, and that's what built us. And clearly something's changed. I'm out in two weeks, and I licked my wounds for a few months after that. And I went to a Tony Robbins seminar, and he said, "You better come up with a brand nobody else can do better than you." And I came up with the retail doctor when I got home, and I filed the paperwork the next day.

Yeah, well, I love this pivot because I do wanna talk about—

That's the rest of the story. But that's how I got clarity.

Yeah, yeah. I love this pivot because I do wanna talk about sort of the architecture of your own business, your consultancy, the way you help retailers. And clearly you've got some tools in the toolbox that you've designed. So let's talk about the AI piece of all of this. I mean, you can take us entry point anywhere you like, but But I'm very intrigued with this idea of agentic AI and using avatars and all those things. So let's go for it.

Yeah. Well, so SalesRx is my selling framework. I've sold that. I've had that version out in DVDs in its original form, actually in a book, original form DVDs. And then I found this platform that worked really well. It's interactive. It was originally created for government and then car dealers, but it's If I have a video, I'll ask you a question and then you have to make a choice and then it will continue. If you don't make the choice, then the training stops. So I already, 'cause I got my degree in education and I come from 2 educators. So how do we keep the mind engaged is really important. It has to be bite-sized. But anyway, we lost some people after COVID and we went back and did an autopsy and said, what the hell happened? And basically the managers didn't wanna do any role play. I don't really want to connect people. I don't really want to make it hard for them. I don't want to be the bad guy. And you're like, well, that's just a matter of holding people accountable. So this last year, we found a provider and said, you got to help us because after somebody takes the lesson and they take the quiz, there's only 38% retention, which that sounds great. But the reality is if you don't practice it and do something with it, It, it'll be gone. So, uh, we came up with these, we call them Sidekick Recs because it just sounds better than, you know, AI. And so you'll take one of my lessons, 3 to 5 minutes, and then you'll go right into an AI universe. We'll show you an avatar, and then you have your microphone and your camera, and, uh, you're just gonna— we tell you, this is all you're practicing. This one thing is all you're practicing. Like, you're, you're come in and this is the part of the sale. And then you, the first time you enter it, you tell it, this is what we sell, this is what our products are, where we're located. And either it starts or you start. Usually it, it starts and then you just have to spend about 30 to 40 seconds to do a role play. The first few were rocky. People aren't used to it. It's different. And, you know, it would be great. We originally said, oh, this should be video. It's like, well, we can do video except the bandwidth will It's too, it's horrible on, particularly on stores. So you don't wanna do that. It's like, okay, got it. But retention is now over 78% because they go out of AI and then they go into a quiz. And so we are not, we're using it as a learning technique to make sure that that information sticks. And then it's really hard to come back to you as the owner and you say, hey Bob, why do you do that? And you're like, you never showed me. It's like, dude, seriously, I totally know we showed you. I know that you— Took the AI. I know that you passed the test. It's not that you don't know, it's that you don't want to do it. And that's a different discussion. And so suddenly you've got a better tool to hold people accountable. And a luxury retailer, you would know them very well with watches, has reported in some of their stores a 20 to 25% increase in sales. We had another luxury retailer.

That's economic.

We do. We do. Well, if you sell something over $100 in a brick-and-mortar store, If you commission people, you bonus them, you set goals, we're your, we're your company. If you don't, we're probably not your company, right? So, but one guy. So let me— one more thing. So when you sign up, we'll do a mystery shop of you within the first week. And sometimes it's like right the day you, you sign. So you have no chance of telling anybody. And those shops come in anywhere from 3 to about 38%. They're pretty dismal. It's 1,000 points what we use on our mystery shops. After a while, and that gives the baseline. All right, so six months later we come back, unbeknownst to you, and we do another mystery shop to see how it comes out. Well, we had one guy at a hundred percent. We never had a hundred percent. This is just a couple of weeks ago on Rodeo Drive, and I called the manager. I was like, "Was it you? Was it you? Was it you? Were you the guy?" He's like, "No, it was actually our youngest, newest employee." And that's the point: is the framework. Works. You don't have all that baggage. And more importantly, he's the number one salesperson because he's been using it. So one of the things that is always interesting about training to me is you see people's training companies and they'll say, you know, we doubled sales for somebody. We, oh great. You know, Agentic AI needs the proof. So where's your proof? What's the brand? What did they do? And they can't do it. So we have spent a lot of time. In fact, the last month has all been in optimizing for agentic search. So we have now a dozen case studies with actual numbers, with actual people saying this. We have a survey that said 83% of our users report a double-digit increase within 6 months, had to give the methodology, when we did it, all of that, because that's what AI is looking for. And I explained it in one of my keynotes now, which is AI for Retail. We're now selling to Spock. You're not selling to, oh, we're a family business and We value everyone. And no, we're selling to Spock. And you, if you understand that, then that whole universe around you has to support it. And I think a lot of people have no idea how they're going to be left in the dust. We started— Ageniq 2 months ago was recommending me about 3% of the time. And now 5 out of 6 is going to recommend me, whether it's a motivational retail motivational speaker or my retail sales training, etc. So imagine if you have products and you aren't even waking up to the idea that that's important. You know, first to market is the one that wins. That's why everybody talks about Starbucks. Starbucks was one that figured it out. There were other specialty coffee retailers around, but they were the one that realized it's a system. We're selling drinks and we're going to use our own language and all these other things. And other people have tried But that's what's— that's why it's so important. If you're on this call or this podcast with us, you only not have to understand it. You've got to think differently about it. You've got to ask different questions. It's not like, oh, write me a poem for my daughter's birthday. It could do that, but it's much more using like Claude Cowork and having it go out and optimize 600 of my videos over 2 days on YouTube that I had. And it's like, yeah, these— you got to get these up to speed. Just went ahead and did that. And there's a lot of dangers, I believe. I know this is a very long answer, but I think we are calling stuff down. No, it's fine. I absolutely believe that it only takes one bad actor. There's so many flags going up, right? It's scary. So I hope that answers in like 100 minutes the one question you asked.

Yeah, yeah. No, no, it was a robust answer. And it sort of— what I love about it is that you let us into the you're thinking out loud kind of a thing, which is always very engaging. So, and it is, and it's an interactive training, this AI, the both of these components of AI, are they inter— in other words, you can converse with it the way we're seeing a lot of these models work, or is it more of a broadcast model and then they go take the quiz? I'm, I'm just curious about the training itself.

Now when you go into, we have, we start you off nice. We have Jennifer and we have Bill and one like way later is Karen and she's just a bitch. I mean like, Oh, man. When you hit her, she's— because the point is you've been doing this a while and you get bored with it. You're like, oh, I know how this goes. Well, good luck, because she'll pretty much say like, are you disrespecting me? Or she'll just say, okay, well, I'm out. And it's like, wait. And you hear the door slam.

Wow.

So you trained people?

Yeah.

That one takes a lot. You know, people have to repeat that 5, 10 times. And we say if you miss it 3 times, You got to go back because you're obviously not doing what we taught you. Right?

Right.

Wouldn't it be better to do that with AI than somebody who has their wallet out and they're like, oh, I don't think so. I'm going to look around. That's the way I look at it.

Right, right. Well, you do. You're stripping out the emotional sort of the complexity of humanity in a way, in a good way. Also in the, in the role of your own business, You have this newsletter with 100,000 readers, 400,000 LinkedIn visitors. I thought there was a limit on that, Bob. I think you blew through the limit there. And so how does that tie into you and your brand being the power of voice? Are you— is it a lead generation thought? Is that basically what's going on there? You know, just unpack that a little bit for us.

I'd love to say it's great having 400,000 followers. Give me 10 that will pay me full fee and I will be just as happy.

Right.

You know, I was early on to LinkedIn and it's built over and over, over the years. It's a matter of being consistent, which ties into the newsletter as well. You have to have something to talk about. And a good example was on— this is Wednesday— on Monday there was a press release and it was Burger King. And Burger King has announced that— and Tom Curtis, who's the CEO, was doing a lot of great things. So Tom Curtis opened all the phone lines and said, call us with your suggestions and problems you've had with Burger King. So people were calling in and saying, my food was dry, the order was wrong, et cetera, et cetera. Customer service was mean and all this other stuff. So they took the option that they said, okay, well, if that happens again, what we're gonna do is have a dedicated person in the store wearing a vest. So if you have a problem, you're gonna go through and ask the person with the vest and they're gonna fix it. And so I said in the LinkedIn post, you can't vest your way to customer service, which made me laugh. And I'm giving you the answer, so it's fine. We're just going to keep going. And so I wrote that. Well, isn't it interesting how he, the CEO, joined in the comments and said, well, it's, you know, it's a start and we have to start somewhere. And I got the managers, you know, and the franchisees together. It was Kind of at a rah-rah meeting. And then I wrote right back. It's like, well, that's great, but you don't do a press release like this until you've done it, because now people are going to walk in, where's the vest? And you haven't gotten it trained, etc. There's a training issue. There should be no vest. All right. So it started off at like, I don't know, 2,000 views. And yesterday morning was 35, and right now it's at 80.

Wow.

And that's the power of having a good network. Right. So my name is out there. It's me. It's not, you know, AI will help me like make sure you don't put garbage in there. But I have a really, as you can tell, a pretty strong point of view, right? So that's what people will come to me for. So when I see people who have these generic, you know, I was in the park today and I saw a piece of trash and it reminded me how so many of us can treat people like trash. And you're like, Oh dear God, did you think someone cared? And we're losing that voice. You know, I think as people, they don't realize that it's blanding your voice. So, certainly with my newsletter, it has gone out every Sunday night at 5:30 since 1996.

Wow.

And pre-HubSpotter, I, it was with HubSpot. I think I'm like number 75 client in HubSpot. And the reality is you better have something to say. That's my key thing. And it's always your audience that you care about, right? I mean, I'd love to say like, I'm amazing. I have a hard time saying that in my posts and in my newsletter. It's always about you and yours. So it's the same thing I say to entrepreneurs all over the world, that your messaging about I, I, I gets old really quick. All anyone cares is You know, how are you going to make me more money? And when I sit in keynotes, you know, if there's a speech after me or before me, I'll listen to the speaker and I'm like, you're in a vacuum. You aren't even realizing that the people in the audience right now are saying, how is this going to help me make my mortgage payment? How is this guy? So when they're reading your newsletter, if you don't answer that, you're not going to get people who want to read it and more importantly, not listen. And even I would say in your podcast, people listen to it. It's interesting while you're working out or something else, but there better be a nugget of something that they can say, oh, I should do that. So again, if you are just joining us and just suddenly realized, oh, what's Bob's trip? You better get on AI and simply ask it, I need you to do an audit of my brand online and tell me where the gaps are and give me a grade. And invariably it's gonna come back a D minus and you're like, cool. How do I fix it? Give me a systematic way to do it and then poke holes in everything you've suggested on why that may or may not work. You don't have to go and some book of 18,000 prompts. All you got to do is just ask smarter questions. And it's the same thing I say, David, with entrepreneurs, you know, that why can't I? I wish I— why does that guy— well, you're killing yourself. It's instead How could I? What if I— and then your mind's in a much better place. And I think that's what that connection back to Tony Robbins was 34 years ago, that it really is. People have got to ask better questions. And it's hard in this economy, right? Because you can go down that rabbit hole really easily. You know, I think that when I go out in the world, I, you know, I was a conductor. So I think of myself as giving the world voice lessons. I think right now we have too many people That would rather go through and text somebody than talk to 'em. And it's up to us to help 'em. And an example I do, David, when you're thinking about how do I, you know, what's gonna take for someone to be successful is I think, look, most of us are this feral creature when we start out, whether a high school or something like a barn cat. It's stay away, mine, mine. And we're in this kind of I world, right? But a goal of a, a great boss or mentor or a retailer is to take you from that person and develop you enough that in my world, in retail, you're a great associate, you're confident, you can help people, you make sales, but you become a confident person. And when you do that, you've actually made them a better parent and a better part of the community because now they're a we person. But why are we in trouble politically? Because too many people are stuck in I. David's got glasses. Why don't I have glasses? I never get glasses. Well, you don't need glasses. I know, but why shouldn't I? Right? It's that eye. Someone's getting someone else. And I just say that's the goal. So when I did this on my keynote in São Paulo, name drop, a couple of months ago, even in Portuguese, they were like, oh, it's like, yeah, that's our, that's our job, man.

Yeah. No, no. I love this idea about asking better questions and also this idea and this mindset of constant improvement. It's so powerful, it's so important. Too many business owners and entrepreneurs are stuck with the I, and they're stuck in not understanding that more expansive view that you have. This has been great. I hope we can do this again. I, you know, we've had some challenges with connections today. We're gonna edit this together as best as we can for those watching and listening. Bob, thanks for doing this today and continued success to you. It sounds like you're really tearing it up in the market. And I, I'm gonna guess that a lot of what you're doing in retail applies to businesses like mine that are in services, online, virtual, It doesn't really matter. It's all of these things are ubiquitous to humanity and therefore business, right? Be well. Thanks so much.

We're about as successful as we make our minds up to be. That's kind of it.

That's it. All right.

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