5G Retail: The Connected Consumer and How Tech-Networks Will Reboot Commerce

Toby Redshaw

Former SVP, Enterprise Innovation, 5G Solutions at Verizon

Learning Objectives

Please Join the SVP, Enterprise Innovation, 5G Solutions of Verizon, Toby Redshaw in this Executive Interview where he will discuss the future of omni channel and why 5G matters.


"The short version is companies that adopt the 5G platforms will have a lower cost structure, a stickier experience with their customers, and a better sales life cycle with the customers."

Toby Redshaw

Former SVP, Enterprise Innovation, 5G Solutions at Verizon

Transcript

Britt Erler

Hello, and welcome to the CIO Visions Leadership Virtual Summit hosted on Quartz Network. My name is Britt Erler, QN Executive Correspondent. Thank you so much for joining us. I am pleased to welcome our Executive Speaker here with us today, Toby Redshaw, former SVP of Enterprise Innovation and 5G Solutions at Verizon, as he provides insights on 5G and how tech networks will reboot commerce. Welcome, Toby.


Toby Redshaw

Thanks for having me.


Britt Erler

It’s a pleasure to have you here and really thrilled to dive into this topic today, because it is something the IT audience has always requested. Before we do so, if you wouldn’t mind providing us some context about your background and your current role.


Toby Redshaw

Unusual background came up through the business and the technology ranks. I was at FedEx for 17 years, which was a technology and business company merged together. Then ran a bunch of tech, supply chain, and business things at Motorola. Did a start up in a Silicon Valley stint. In between that, big financial services job, ran all of technology, some risk committee, some of the business parts were very old company out of the UK. Then, came back and ran a little consulting biz, sort of next gen tech transformation innovation thing. Then, Verizon at the beginning of the 5G era, where I did the 5G strategy for the company, and then ran some of the smaller business unit, some of the AI transformation, and the 5G innovation platforms.


Britt Erler

Fantastic. As you and I discussed prior to this interview, 5G is something that our audience has always requested to hear more about, but not many people are experts in the field. For those watching that are unfamiliar or really just getting their hands deep into this, can you briefly demystify 5G, what it is and why it matters so much?


Toby Redshaw

5G is really a big leap forward from 4G, and it’s a big leap forward in several ways. I’m sure, on one side, think of it of two buckets of things. On one side, there’s some very standard, telecommunication things, it’s way way faster. It’s much bigger bandwidth. It is amazingly low latency, and latency is how quickly you can go through a network, do some compute, and get a response back. Is it fast enough for real-time transactions through the air. Real-time transactions when you’re wire connected is easy, real-time through the air has never been possible before so, yes, it can do that. 4G was a 5-lane highway where you could go 70 miles an hour. 5G is a 30-lane highway where you can go 300 miles an hour. It’s broader, a bigger, faster, better response time, but that’s really only half the story. It’s designed for connecting to really fast drones and high speed trains. It’s designed for the modern world. It’s a little bit more secure than 4G, but that’s really just the connectivity side of the story. The really big game changer is that it’s a software defined cloud native network, which is techno gobbledygook for the edge of the network turns into standard compute. 5G is I have a device connected to a network, and I have a supercomputer in my back pocket because the edge of the network which is 3040 milliseconds away, has compute in it for me. Now, I can do a lot of really different clever things that were just literally impossible with 4G, because 4G is a communications network doesn’t have the built-in compute at the edge.


Britt Erler

Now, we have a lot of retail companies that are watching today. I think the big question for them is what are going to be the impacts?


Toby Redshaw

I think it’s going to be a really big deal for retail, partly because the times that we’re in. We’re coming out of COVID just starting to emerge with that spending is starting to pick back up. There’s a little bit of inflation, which gives retailers some pricing power. Not all the stories about inflation are negative. There’s a willingness to go back into retail again. Let me put it in terms of platforms, 5G will let retailers have several different types of new platforms that will change their business. The short version is companies that adopt the 5G platforms will have a lower cost structure, a stickier experience with their customers, and a better sales life cycle with the customers. That’s really all your business is in retail. If your sales are better, and your engagement is better, and your cost structures better, you win. How did they do that? Three very basic platforms, put intelligence at the edge, and with the big box store, with the mall at the car dealership, in the stadium. I can put intelligence at the edge and do AI in real time because remember, I’ve got compute at the edge now, and I can do 40 milliseconds through the air to your device or to wherever you are in my environment. Intelligence becomes real time, which if you think about couponing, or managing shelf level opportunities, or heat maps, or making sure the beer line doesn’t get too long in your stadium, which is a real thing. I need intelligence at the edge and I need really fat bandwidth to go through the air. Oh, gee, what is that? That’s 5g. The other thing that I can do is I can take a $50 dumb camera, and I can look at an environment and take those pixels. Because I’ve got compute at the edge, I can take those raw pixels, and again, do intelligence. I can do shelf level versus planet gram in real time. I can do real time inventory. I can link that to couponing. I can do real time demand shaping based on where you are, who’s there, who’s in the store, or even who’s close. Of course, there are security and other issues you can use the cameras for, but the cameras turn into sensors and become intelligent, especially little cheap cameras because again, I’ve got that through the air and I’ve got 5g compute at the edge. Also, that doesn’t require a ton of cabling, so now I’ve lowered the cost structure. Then, the third one is AR and VR. AR and VR have to be in real time because if your visual input and your movement recognition get out of sync, you get nauseous. It’s the same thing that happens when you get poisoned. Those two systems in your brain get out of sync and you get nauseous, and then your brain says, “Ah, you’ve been poisoned.” What does your body do when you think you’ve been poisoned? You throw up. AR, VR without real time, which again, is that 5G through the air and compute in any untethered way has to be real time, 30, 40 milliseconds, otherwise, you’re going to be ill. Having AR pop-ups and having VR experiences for retail, so being there without being there, or taking my digital assets with me attached to the last LeBron short I that I bought, or my fantastic new pair of kicks, that’s my only Gen Z reference, by the way. Those three platforms are going to transform retail. It’s cognitive video or synthetic IoT, which is a fancy word for both of those things, AI at the edge, and then clever AR, VR, and combinations of those, lower the cost structure of retail, improve your inventory management, real-time demand shaping, better customer engagement, and better customer experience. You’re all of that together. Your retail store becomes proactive and pattern matched and peer connected and preventative and precise. That’s just a winning combo, especially if you think about two stores, one that has that and one that doesn’t. Which one do you want to be at?


Britt Erler

It really sounds like a game changer for retailers as a whole. As with anything, there are always some challenges or obstacles that they face. Are there any that you believe they should be prepared for?


Toby Redshaw

This is more hands-on technology than I’ve ever seen. What do I mean by that? Like when BPM came out, you could train somebody on a business process management tool literally in 20 minutes, and then the business people are off doing cool things with it. You could turn on a HR system like workday, send somebody a memo, “Hey, look, we’re turning it on tomorrow. It’s like a website.” No one shows up at your house and trains you every time you go to a new website and it’ll work fine. 5G, especially these platforms that I’m talking about, are totally new environment. The sooner you get your hands on them, and the sooner you start to play with them, the sooner you learn, the better you will be because what happens in those environments after the first implementation, is people on the factory floor or in the distribution center or on the retail floor. In the mall, or at the stadium, they’ll go, “Hey, you know what we could do with this, we could do that,” and so you need practitioners. Back in 2017, when I was at Verizon, we rolled out the first locations for 5G. Very quietly, very privately, just to see how it would work because even the physics of the radio are very, very different than 4G. 4G is this giant, big tower, wide band of radio wave, and 5g is a little six degree beam that shoots about 1000 yards—very targeted, very smart. Not only 5G, but 5G with compute at the edge, and cognitive video, and AI, these are new things that will transform businesses but they’re learning intensive. It’s kind of like the nail gun. When nail guns were implemented, they never just give somebody a nail gun and went, “Hey, knock yourself out, go ahead.” Now, a slide rule or a hammer, you can figure that out, but a nail gun, you want a little bit of training. It’s definitely what I call a hands on a technology and having that experience being on the field, getting the bumps and bruises with it, is competitively valuable.


Britt Erler

Now, we talked about obviously, the impact this is going to have on retail, but why are we all the sudden seeing such an acceleration of adopting this technology?


Toby Redshaw

I think there’s three reasons. One is economic. The markets have been constrained, We’ve been through this terrible pandemic. We’re not through it yet, but hopefully, at least in America, we’ve peaked and we’re coming out the other side. Some terrible things happening in some other countries, hopefully, they’re coming through. What’s happened is you’ve had a contraction cycle, followed by huge government stimulus, so now, there’s a growing market. Companies have been struggling, and now there’s this great prize of oh, man, go get your share of that pie, right? Get your market share, get your top line, get your customers, grow your business. It’s sort of like fuel for the economic fire. It is going to be one of the most competitive times over the next couple of years. The second one is that these technologies are now moving out of the lab, they’re moving out of the experimental phase, and they are on the factory floor, they are in retail. They are now becoming on their way to becoming a mass user. You’re starting to see the beginning of a competitive adoption and think of technology as competitive weapons or tools, right? Do you really want your enemy to have better weapons and tools? The third factor is this is starting to get quite a bit of buzz, and up at the top of companies, that’s like, “Let’s make sure we don’t get leapfrog.” I had the risk committee of a 300-year-old financial services institution, ping me about 5G and say, “Look, we really want to dig into this,” and I went, “How did you even hear about it and why?” They’ve literally said, “If our enemy gets a hold of this before we do, and their cost structure is better than ours, and their customer engagement is better than their customer lifecycle value. That’s all our business really is, and they win.” It’s a really interesting sort of soup of things coming together to create this really big impetus.


Britt Erler

You’ve talked about retail. You’ve talked about the implementation of this on financial industries as well. Are there other industries that you believe will be affected this quickly?


Toby Redshaw

At a personal level, I’m most excited about the wonderful things this can do for healthcare, and the wonderful things this can do for education, especially because it’s a network-based technology. I can blast through the absolutely ridiculous and dumb geographic barriers that lots of countries have, where that zip code is going to get bad health care and bad education and that zip code is going to get great education and great healthcare. If I’m building network based solutions, then with compute at the edge, then maybe I can solve some of that and put that over the network, so I’m super excited. Plus, in both of those industries, there’s a lot of opportunity for improvement, asset utilization, layering in more intelligence. Remember, 5G is an intelligence at the edge solution, not just radio waves through the air, so super excited about those. I’ve been on the floor of the most advanced robotic sized factories and distribution centers, and every one of those you find 20 or 30 different things you could do with these tools. The big picture is we believe that putting intelligence in those other tools at the edge makes you—back to those P words: proactive, preventative, pattern matched, predictive, peer connected and precise. Imagine the health care center, do you want to go to the one that has all of those Ps or the one that doesn’t? I want that one. Which shopping experience do you want? I want that one. Which city do you want to visit that has that kind of stuff built into it? I think we’re at a really cool time in history where there are enough profit pools and asset utilization improvement in taking cost out of cost structure to where these are accretive both on the cost side and on the revenue side. Anytime you have that in business, there’s a huge adoption curve. Again, in these kind of cycles, it’s a creative destruction cycle, and what people forget is there’s a destruction side. Which side of these do you want to be on? Specifically, you look at retail, go back the past 60 years and look at each decade and who was the top retailer, and you’ll go, “Oh, my goodness, those kings of retail don’t even exist anymore.” People should worry about—especially even the folks on top, I know Walmart are very positively focused on that. Look, we’re the biggest, we’re the best, but that never saved people in the past, so just keep up with the tech.


Britt Erler

As we wrap up this conversation today, we’ve talked about the impacts of 5G, but I want to talk about the future of omni-channel and why it plays such a big role.


Toby Redshaw

There’s been a lot of work on omni channel over the last 10, 15 years because you just have varying experiences depending on how you engage them, where you’re engaged with a brand that you would expect a good experience with. What that variability did was it added costs, and it invariably had areas where that wasn’t a good experience. They’re great in the store, they’re terrible online, or the online stuff is kind of okay, and then the store is sort of randomized. It’s not good to have that variability, even remote experience where our cost structure perspective. There was all this work on omni channel, which was to try to make all the interfaces shiny and equal and nice, and so you remember things from one to the other. Even the company would remember me from one to the other. In the early days of e-commerce, it was like you were two different customers. That’s sort of yesterday’s news. Where this is going in the future is it’s going to be sort of like a box of Lego, where you pick how you want to do the commercial transaction. Do I want to do it online? Do I do it in the store? Do I want to do a mixture of those? You pick your piece of Lego of what sort of distribution do you want? Am I okay having it go to my locker, where I pick things up with my gas station periodically because that’s greener, or do I pick it up next time I’m in the store out of a pickup area. What’s my distribution model, especially attached back to what my personal carbon footprint is, and then what sort of payment model do I want? I’ve got different pieces of Lego that I can attach, so omni channel now becomes the super powerful customization thing for customers where they can pick experience, they can pick a distribution, they can pick green impact to do that, they can pick their financial and commercial experiences attached to it, and then they can also pick the digital add-ons that will start to come with most sales. When you buy something, you get a little digital asset that goes along with it, which three or four years ago, people were like, “Oh, digital assets, those will never catch on.” I’ve got 2, 3 letter acronyms for everybody who doubts that and that’s NFT and NBA, and just go Google that if you don’t think there’s a way for that to happen. Then, I feel recognized. I feel like I’ve had a hand in the solution design and I’m a much stickier customer and that is also more cost effective. You’re going to see companies go that direction, sort of this localized mix and match. The interesting thing that a lot of companies have forgotten in retail is that look in the next 5 to 10 years, if you’re not viewed as an authentically, socially responsible green brand, this much of Gen Z and this much of Millennial spend will migrate away from you to brands that are seen as socially conscious and focused on green. Most companies, those two numbers are bigger than your entire profit margin, because Gen Z is such a big cohort when you go 5 to 10 years out, so that enabling of choices and providing the green on social impact side through a Lego model of omni channel, I think that is a very interesting future for retail. The icing on the cake for retailers is to be able to cross sell and upsell into that environment is so much easier because it’s just boxes of Lego where you’re adding in more opportunities.


Britt Erler

It’s that ease of use, that more personalized approach to sustainability. I hear it in every single industry with executives that I talked to. I couldn’t agree with you more than that really is the future, especially in the retail industry. As we finalize this conversation today, I think there are a lot of companies that are really just beginning this 5G journey or they’re kind of in the middle of it, and they say, “Okay, where do I go from here?” Final pieces of advice for them today.


Toby Redshaw

Think of 5G like running a commercial kitchen or playing rugby. I can give you a PowerPoint on how to run a commercial kitchen—I used to run one. I can also show you how to play Rugby and give you a PowerPoint, but if I put you in a commercial kitchen in New York on Friday night or out on the Rugby field, you get murdered in both places. 5G is not that in-depth, it’s conceptually simple. We can cover it in the 30-minute conversation. It’s just a practical thing that needs hands-on. It’s sufficiently different. A commercial kitchen is sufficiently different than the kitchen you have at home. There’s a whole nother level of complexity there. Rugby looks a little bit like American football, but it’s not really, so you want to be the team that’s been in the kitchen for a couple of years, that’s been experiencing, that’s been learning, that’s been harvesting that real hands-on value. I know how to play with 5G. You don’t want to be the team that’s been watching the PowerPoint and then marches on to the field and go, “I’ve got this.” If you’ve ever seen anybody play rugby for the first time, it’s not pretty, and they normally end up pretty injured. You don’t want to be that company. Not all technologies are practical things. Some of them, you plug them in and turn them on, and you’re fine. This is not that. This is you better go figure it out. Remember, 5G is compute at the edge and those new cool platforms that do new, cool, creative things for you.


Britt Erler

Well, I think this has been incredible for retailers as they begin this journey and figure out where they start and also how best to prepare. Toby, thank you so much for being here and providing your insights. It’s been an absolute pleasure. Thank you to everyone who has joined us today as well. I’m sure you will all have further questions for Toby—not to worry, we will have a discussion forum underneath this presentation. Thank you again for joining us and have a great rest of your CIO VISION Leadership Virtual Summit. Thank you.


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