Our guest this week is Joshua Shabtai.

Josh is the Sr. Director of Ecosystem at Lowe’s Innovation Labs, where he leads a global team responsible for articulating the future of home improvement retail and establishing strong, actionable partnerships with technology and cultural organizations of all sizes.

Josh’s background as an augmented reality videogame designer, connected-toy start-up founder, and advertising creative director has fueled his passion for partnering with visionary companies and working to scale breakthrough ideas at Lowe’s.

Join us as Josh breaks down the culture that supports true innovation, the future of AR/VR, and how Lowe’s is transforming the way small businesses and professionals meet the needs of customers.

Episode 89 of the RETHINK Retail Podcast was recorded on July 17, 2020. 

 


Hosted by Julia Raymond
Researched, written and produced by Gabriella Bock
Edited by Trenton Waller

TRANSCRIPTION

Julia Raymond:
Hi. Welcome to the RETHINK Retail Show. Our guest today is Joshua Shabtai. Josh is the senior director of Ecosystem at Lowe’s Innovation Labs where he leads a global team responsible for articulating the future of retail home improvement and establishing strong actionable partnerships with technology and cultural organizations of all sizes. Josh, welcome to the show.

Julia Raymond:
Joshua, thanks for joining me today.

Joshua Shabtai:
No problem. Thanks for having me.

Julia Raymond:
Yeah, it’s great to have you on the show, and I wanted to start out by asking about your background because I think it’s pretty unique. You were in augmented video game design and then you founded your own company, a connected toy company. Can you tell our listeners a little bit about what your journey has been like professionally?

Joshua Shabtai:
So, just personally as a human being, I’ve always been obsessed with fantasy and storytelling and immersing people in worlds that are just completely unique. And then I take them out of the day to day of where they are. And over my career, I’m just lucky to translate that initially into a marketing career. I worked in public relations and as a creative director in advertising where the focus of much of the work was creating unique cultures, so with clients like Geek Squad and things like that.

Joshua Shabtai:
Creating these narratives that blurred the lines between what was sort of a fiction and what was real in terms of the lives of the employees and things like that.

Joshua Shabtai:
And so, my love of those things actually stirred me towards exploring game design just launching independent alternate reality games that were real lightweight, low tech, but would help get people to think about the world a little bit differently.

Joshua Shabtai:
Through all of these explorations and just looking for more opportunities, I ended up working my way into building an augmented reality Star Wars game for the iPhone to let you turn your home office or your external space into a battleground for having TIE fighters fly around and just recalibrate your understanding in space.

Joshua Shabtai:
As I worked through a lot of these variants of storytelling through games, through connected toys, one of the things I realized I was missing as a game designer was I really do enjoy telling stories about the future and enjoy creating experiences that can help drive a different understanding of the future. But what I really wanted to be able to do was create compelling stories that could actually come to life in the real world at scale and affect millions of people.

Joshua Shabtai:
Over the last few years, just became personally interested in how can we create a technology-infused culture in the future that will create many jobs and create economic opportunities.

Joshua Shabtai:
So, a few years ago, I heard from the folks at Lowe’s Innovation Labs and they built a really interesting practice that was focused on using storytelling techniques to generate a picture of the future that would be valuable and desirable for millions and millions of customers whether they are people who live in a home or whether they’re professionals who make it their business to help work on homes, remodel, repair, as well as to hundreds of thousands of employees that work across Lowe’s stores altogether.

Joshua Shabtai:
And I was really fascinated by this science fiction narrative-driven storytelling approach that was designed to basically lead to testable technology experiences, that the idea was, we’re going to try to bring these stories to life for millions of people at scale.

Joshua Shabtai:
So, we are the innovation center for Lowe’s companies. We’re part of a technology organization. We explore a variety of emerging and exponential technologies. So, spatial computing, mixed reality, robotics, new methods of manufacturing, a variety of other things that maybe just aren’t being considered for retail. So, we have a wide purview.

Joshua Shabtai:
And through that lens, we do two things. One, we accelerate experiences that customers expect today. And on the other hand, we develop entirely new capabilities that they may not even expect that we think will transform the face of home improvement retail. And I mentioned this sort of narrative-driven approach, right? And what we do is we look at our customer’s deepest pain points. We look at cultural trends. We look at technologies that are increasing in capability and performance and scale to start projecting futures that we want to build when it comes to these new capabilities.

Joshua Shabtai:
And those usually take the form of themes. And so, one of the futures, one of these narratives that we’ve been really interested in building out is what we call the democratization of expertise. And the idea there is that home improvement is really complex. You could spend a lot of time learning just how to fix one part of your home and you’d be scratching the surface even after hundreds of hours of study. I mean it’s a really complex process.

Joshua Shabtai:
Yeah, and Lowe’s sits in a weird way. We sit at sort of the epicenter of expertise in all these. When you think about the millions of customers that come through the Lowe’s system every week, you’ve got people who have been working … I mean, with very specialized trained knowledge

Julia Raymond:
Contractors of all sizes, yeah.

Joshua Shabtai:
It is really. Thousands of years of expertise. So, we look at it as okay, we are really this excellent hub for all this expertise and in some ways, we help our DIY and do-it-for-me customers, we help arm them with the know-how to either do it themselves or know-how to have a good meaningful conversation with the pro.

Joshua Shabtai:
So, one of our futures that we’ve been looking to do is how do we unlock the expertise that is concentrated amongst the select few and open it up in radical new ways.

Joshua Shabtai:
So, democratization expertise, we’re looking at how can we unlock this in new ways. Spatial computing and mixed reality are sort of one vector that we think can play a really interesting role.

Julia Raymond:
How has the application directly helped democratize the expertise for training of anyone or-

Joshua Shabtai:
Well, there are lots of different ways. I’ll give you two examples. One, as you mentioned, training. The ability to immerse someone in a very lightweight way in a full experience and let them build muscle memory and let them have a real experience to basically transfer that knowledge is huge. And we’ve done quite a bit of testing in that role, and we think that is the way where you can shorten the window in terms of conferring trade skills and empathetic soft skills to someone in minutes versus days versus weeks in the retention [crosstalk 00:09:56]

Joshua Shabtai:
But the other aspect and the other example and there are plenty more, believe me, is connection and connecting people via telepresence in a much different way. And so, there is a segment of the population that has tons of knowledge. If only they could get into your home, they could tell you why your toilet exploded instantly or-

Julia Raymond:
I hope my toilet doesn’t explode.

Joshua Shabtai:
Well, especially during these times, it’s never good. Or to look at and help you understand what new countertops or flooring could really work in the kitchen that you have. It might have you able to get there with some of these new technologies. We might actually be able to close the gap, provide new tools that enable the pro on the other side regardless of where they are in the world or how mobile they are to be there with the customer.

Julia Raymond:
Very cool. Almost like an adviser or a design adviser or you are some sort of trade like you said electrician. Well, I don’t know about electric … I don’t know if we’re going to be doing our own electric fixes around the house.

Joshua Shabtai:
Well, it’s not just as an adviser, and there is a place for diagnostics. Even in the case of an electrician, oftentimes, you come to someone’s home and you need to suss out what the problem is. Sometimes you don’t have the right parts with you. Sometimes you’re like, “Okay, I’ve assessed what needs to be done. I’ll come back, let’s schedule a followup for a week,” or whatever. Now, you can actually offload some of the diagnostics.

Joshua Shabtai:
So, it isn’t just advising. There’s some of that advisement but it’s helping triage and diagnose faster. But those are just two examples of how we look to democratize expertise and how augmented mixed reality, spatial computing technologies can start to bring people together in new ways.

Julia Raymond:
Well, I wanted to ask you these. You’ve seen both sides of the coin. So, you’re working at Lowe’s Innovation Labs and Lowe’s is a $70 billion dollar corporation, it’s huge, but you’ve also been on the other side where you’ve been innovating in a startup capacity. And one of our past guest, Eric Toda, he founded Hill City Gap. He’s now with Facebook on their global team and he said, of challenger brands “If I’m a startup and I have a great product, I’m looking at how I disrupt my own industry. If I’m a legacy brand, I’m saying to myself, ‘I can’t let this startup disrupt me. I need to disrupt myself.'” So, how do you see the similarities and differences from innovating with Lowe’s versus when you are doing your startup thing and all of that?

Joshua Shabtai:
Yeah. Well, I will say I’ve been with Lowe’s for about four years now, and I mean, obviously, I have to say good things. But I can’t say enough good things about working here. There is such a strong customer focus, like everything is laser-focused on how are we helping to serve our customers, how are we helping to serve the people who are on the frontlines serving our customers.

Joshua Shabtai:
And on some level, I think that laser focus effectively trumps legacy thinking, if that makes sense, because if something is not working or could work much better to serve that customer, it’s our obligation to pursue it.

Joshua Shabtai:
It’s our role to be specifically focused on looking at what are the ways we could serve our customers that might live outside of what they expect today from home improvement retail.

Julia Raymond:
So, is that about delighting them and surprising them or is that just finding the value they didn’t even know they needed?

Joshua Shabtai:
Look, you always want to delight your customers for sure. I am always personally in favor of, can we surprise them? Can we deliver something that meets their needs in a way they didn’t expect, because I think you always build deeper relationships that way. Some surprises aren’t that great though. It just depends on the surprises.

Joshua Shabtai:
But what I’ll say is we try to keep nothing sacred in terms of identifying better ways to meet our customer’s needs. And I’ll give you an example. This is a product we just launched that is in and of itself a product of our exploration into the democratization of expertise and our use of mixed reality platforms to do that.

Joshua Shabtai:
So, we launched something a couple of months ago, it’s called Lowe’s for Pros JobSIGHT, and it’s augmented video chat tool that is basically accessible to anyone with a smartphone. No app download needed, it’s web-based, that lets pros conduct remote home visits but with a series of tools that almost makes it like they were there.

Joshua Shabtai:
So, not only can they see what you see through your camera which is sort of part for the course, but there’s computer vision elements that can let them read the serial number of an appliance. So, they can actually start to [crosstalk 00:16:05] on the fly and really understand what they’re looking at, their annotation tools, their 3D objects they can place in the homeowner space to guide them through the thing.

Joshua Shabtai:
So, this is one of those examples where if you ask people prior to COVID or any of these things. You said, “Hey, can you imagine someone can conduct a full home visit and diagnose a problem until you … Without ever having to come to your home? Do you think that’s possible?” And [inaudible 00:16:35] somebody will, “Yeah, I think so but it needed to be this.” Now, we’re getting into a scenario where I think people are really clamoring for those kinds of solutions.

Joshua Shabtai:
And so, we look for those kinds of opportunities to rethink and say, “Look, if we can deliver [crosstalk 00:16:55].” Well, really, there we go. Pun intended. But we’re looking for ways to basically just deliver on what customers need.

Julia Raymond:
Now, I have a question, because you’ve been working on this, I’m assuming, and you were developing this really cool solution for small businesses. Were you working on this before the pandemic and it was just great timing or was this something that you picked up right when COVID started?

Joshua Shabtai:
I mean, so this thread of workaround democratization of expertise and use of mixed reality platforms that we’ve been working in for years. And we’ve been working across every platforms. So every headset you can imagine, every operating system, and the learnings along the way got us to a place where we said, “Look, if we can start identifying web-based, simple to use, at the moment mobile tools that can enable real meaningful collaboration, we’re going to have a winning thing.”

Joshua Shabtai:
And so, a couple of years ago, we actually established a relationship with a startup at Portland, Oregon called Streem. And yeah, we’ve been working with them for a few years.

Julia Raymond:
And did that help the Lowe’s for Pros JobSIGHT? That’s all part of it?

Joshua Shabtai:
Yeah. So, this was not being built as a reactive thing. This is a capability. We think people are going to want in the future when things happened. One, we serve a variety of customers, right? Not just the folks who are do-it-yourselfers or do-it-for-me. We serve the pro.

Joshua Shabtai:
And a big part of what we were seeing over the past few months is your average customer may not be as comfortable having someone they don’t know come to their home. But sometimes you got to have someone come to your home. If your toilet explodes like we joked about it, you need someone. And so part of this was this might be the perfect tool to put our pros back to work.

Julia Raymond:
Very cool. And I think the coolest part about the Lowe’s for Pros JobSIGHT is that most businesses, even if they are somewhat large, wouldn’t have the capital or the talent to quickly roll out something like this, I mean, in-house. You guys have been working on this for years. So, for you, it’s something you’re really offering a lot of value to especially the small to mid-size businesses.

Joshua Shabtai:
Yeah. And I will say it’s truly cross-functional … this kind of project doesn’t just happen with an innovation lab building it. It really was this collaborative effort amongst a variety of teams to deliver something that scale.

Julia Raymond:
That’s another question I have for you, do you feel like you’re arm’s length and there’s benefits to that in terms of how you operate as an innovation lab outside of Lowe’s or is it super integrated?

Joshua Shabtai:
So, that’s a great question. Challenges that most innovation groups encounter at one point or another is, are we focused enough on meaningful problems to the business or are we focused enough on the future? How do we resolve that tension? How do we make sure our work not only gets recognized internally but it’s actually on a path to being adopted … You don’t want to just be an R&D lab that never ships anything at scale.

Joshua Shabtai:
And so, what I’ll say is we are a standalone unit to protect some of the far-future thinking, so that we have a space and not just far-future thinking but trying to connect dots across a variety of parts throughout the business that perhaps one business owner might not be incentivize to do. And so, we have a benefit of that.

Joshua Shabtai:
So two principles that guide everything we do, accountability and transparency. And oftentimes, I think one of the challenges that innovation centers have is they’re separate and they forget to actually quick telegraph lines in to help let folks know what they’re doing and get feedback along the way.

Joshua Shabtai:
We’re very intentional and disciplined. Many if not all of our major projects have VP sponsorship, the business owner. We also work with our executive team to just make sure there is an extreme degree of transparency in what we’re working on and why, whether it has applications today or further into the future.

Joshua Shabtai:
The other thing, I think, that keeps us honest is we’re called the Lowe’s Innovation Labs, plural, because there are three distinct units, three distinct labs. So, my group ecosystem is the unit that is focused on outside in, insights, development, all those kinds of things.

Joshua Shabtai:
We also have a Creative Technology lab which is an applied R&D unit, but they are exploring a variety of far-field technologies, use cases. I mean, there’s some really-

Julia Raymond:
When you say far-field, what are we talking?

Joshua Shabtai:
Well, let’s think about how reality gets captured in the future and how we capture the data all around us, and then how do we use it to create next-level experiences.

Joshua Shabtai:
Then we’ve got a development lab which is one part product management and one part core engineering. And the way these three labs intersect, they’re sort of the fulcrum on which much of the work lies. They’re the most direct line back and forth thing to the business. They will manage an overall roadmap from POC all the way to pilot to production.

Julia Raymond:
So, they bring the ideas to life?

Joshua Shabtai:
We all do. They are keeping the train is running on time and making sure there’s connectivity to the business. So, really what brings the ideas to life. And this to me is one of the things I think is special about those innovation labs, and I think it’s transferable, is these three labs actually create a system of checks and balances. There’s sort of a natural tension.

Joshua Shabtai:
And what happens is when any idea comes in, whether it comes in as a request from someone or it comes in as a request from me because we found some partners we’ve got to do something with, or the creative technology team has invented something we just need to work with. The creative tension and different points of view amongst the teams leads us to make sure we balance both what does the business need and how do we go outside of the current boundaries. I highly recommend any innovation unit to create systems that offset one another and create that healthy creative tension.

Julia Raymond:
Sure. I love how you explained that because I think the healthy tension that you mentioned is probably what makes the best ideas and what makes any innovation labs successful. So you’re not just chasing the next shiny object. It’s really about the real-life application, the feasibility. But from the design and the artist’s perspectives, I mean there are so many moving parts.

Joshua Shabtai:
Yeah, and really staying focused on what is going to be valuable to the customer. And I think you called it sort of the shiny object syndrome. It’s very easy to get distracted and we keep each other honest and very focused on what is going to be meaningful for customers like now and well into the future.

Julia Raymond:
And because we’re talking about the future and no one could have predicted the COVID-19 pandemic, is there specific ways you’re thinking differently now because of COVID when you think about innovation? Or is everything sort of status quo because we know the pandemic will eventually end?

Joshua Shabtai:
Well, I’d say neither of those.

Julia Raymond:
That’s an answer too.

Joshua Shabtai:
Look, when we build narratives that guide the kinds of work that we want to do, we spend a lot of time and we stressed those in. And when I would say part of a narrative-driven process for innovation, it goes back to the oral storytelling tradition which is you tell a story, you get feedback, you see reactions and responses in real-time. You adjust your story. Your story is like it never ends in terms of it’s being refined and creative.

Joshua Shabtai:
And we very much follow the same approach where we spend a lot of time crafting stories that are rooted in core customer needs, not even customer needs in here now but customer needs over a really long period of time. And we look at fundamental human psychology and really think what are the things people need to feel like they have agency over their own lives and their homes, stuff like that.

Joshua Shabtai:
So, we spend a lot of time regardless of if something profoundly disruptive happens. In fact, we operate under the assumption that there are going to be profoundly disruptive technological changes, economic changes, environmental changes that are going to make these solutions sooner or later. Whether it’s sooner or later, we don’t know. Otherwise, we’d probably all be like meteorologists or something [crosstalk 00:27:31].

Joshua Shabtai:
So, none of narratives or stories that we’ve crafted have changed as a result of this, how quickly we implement, and customer readiness. For some of the things that we’ve been working on for a while may actually, there may be more readiness for some of those remote solutions and things like that than we imagine, which is great. We don’t see much change radically outside of the changes we think are coming or just accelerating.

Julia Raymond:
I can see the acceleration. And I’m excited to see how some of these digital solutions helped with the whole contactless movement because when I think about AR and VR in retail applications, one of the coolest ones I’ve seen is Decathlon. It’s a big sports retailer based in Europe. They have a tent demo so you can put on the HTC VIVE headset and then virtually try out the different tents they have that’s a super-specific use case.

Julia Raymond:
But it was really cool. And I know Target, their app, you can look at the different décor items in your house. How do you go about thinking about the use cases as a retailer and determine what adds value and where to innovate?

Joshua Shabtai:
I mean, a big part of the testing process is casting a wide net and really trying to hone in on what those applications are. And in some cases, saying trying to separate the value and appreciation of the experience and application from the technology that you’re delivering it in today, knowing that it will change over time.

Joshua Shabtai:
So, yeah, it’s how to know where to go. It’s really a lot of testing and refining.

Joshua Shabtai:
But as we started to get user feedback and started to understand the sense of, “Wow, I felt like I lived in that kitchen, I was like getting a better sense.” Those are the things that started to click over and say, “Okay, this validates that we should be trying …” It somewhat feels like they were living in the space.

Joshua Shabtai:
We can probably immerse and associate in a customer’s home to understand more about their customer and train them in new ways or train folks in the actual, not just, “Hey, here are a series of tools. We’re going to tell you what it might be like to tile a bathroom,” we can actually put you in the lived-in situation of being inside of a shower stall and you’re actually tiling it in the space.

Joshua Shabtai:
Sometimes, the indirect learnings from other applications push us to double down on completely different use cases.

Julia Raymond:
Very cool. What’s the engine that runs like Fortnite and a lot of the VR graphics?

Joshua Shabtai:
Epic’s Unreal?

Julia Raymond:
Unreal. So, I heard recently that they pushed out their newest release and the level of realism in AR and VR is increasing so much every year. What is your vision for that application five years from now?

Joshua Shabtai:
I mean, that’s another like, “I don’t know if I told you what our vision was.” I’ll put it this way. I mean where we’re at in terms of spatial computing, I don’t know if this is a perfect analogy. But look, I think we believe that there is a future in which the confluence of technologies that are embedded within your home, that sit in your ears, that are on your body in new ways, that touch your eyes in some way, those we think will come together to transform what retail looks like, what home care looks like, or all those things.

Joshua Shabtai:
I think right now we’re still in the early days for what this technology looks like. And on some level, I’m like you think about it, it took decades from the beginning of the car phone all the way to the iPhone which sort of ended up cracking the code on what a handheld device could be and what it could enable. I think we’re still probably more akin to like Symbian phone, a Symbian based smartphone where we’ve got a lot of the functions that are like make your life a little bit easier but a lot of the clunkiness that makes it not easy to sort of embed.

Joshua Shabtai:
And I think there’s a lot of work to do because we’re not really just talking about one platform or one piece of software, one operating system. This is more like a decentralized …

Julia Raymond:
Environment with all the different platforms.

Joshua Shabtai:
Yeah. So, the vision is more for the customer application that we can really make their home improvement experience in much better way. And we can arm pros with tools that can completely transform how they do work, how they deliver work, and create new economic opportunity.

Julia Raymond:
Absolutely. The last question I wanted to ask you is, what advice would you give retailers who are looking to innovate?

Joshua Shabtai:
Well, I’ll say this. I’m just going to start with the shameless plug. If you’re a technologist and you really want to build some special stuff, I mean we’re hiring thousands of new technologists at Lowe’s. And I mean, jobs.lowes.com, we are looking for talent across the spectrum. So, I would say that. That’s my advice. If you want to, please come-

Julia Raymond:
Come work for Lowe’s.

Joshua Shabtai:
Yeah, really.

Joshua Shabtai:
I think secondly, I feel like a narrative-driven approach to how you can see the work and how you execute it is a really powerful one, especially because we’re often talking about concepts that have some ambiguity with them. And a well-told story can grab people in the emotional stakes. It makes sure they’re not focusing on the technology as much as a human-specific customer or specific associate to really guide what they’re driving.

Julia Raymond:
Checks and balances and the narrative-driven approach, so it’s really about the human connection.

Joshua Shabtai:
Mm-hmm (affirmative).

Julia Raymond:
Excellent. Well, Joshua Shabtai from Lowe’s Innovation Lab. Thank you so much for joining today. I learned a lot and really appreciate you coming on the show.

Joshua Shabtai:
All right, thanks for having me. This was great.