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Justin Honaman

Head, Worldwide Retail, Restaurants & Consumer Goods Business Development

AWS

play_circle_outline Use cases of generative AI in retail operations

play_circle_outline AWS capabilities in generative AI, advertising, and digital experience

play_circle_outline Focus on growth strategy, security, and customer experience innovation

play_circle_outline Day-to-day responsibilities of AWS head of worldwide retail, restaurants, and consumer goods

play_circle_outline Significance of generative AI in retail industry innovation

play_circle_outline Customer priorities for using AI technology

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Justin Honaman, AWS

Justin Honaman

Head, Worldwide Retail, Restaurants & Consumer Goods Business Development AWS

John Furrier and Dave Vellante cover NRF in New York, discussing the impact of generative AI and cloud scale in retail with Justin Honaman of AWS. Honaman emphasizes the need for retailers to adapt to new technologies like AI to stay competitive. AWS offers services like generative AI and digital experiences to help retailers innovate. He advises prioritizing technology and data to drive innovation and customer experience, highlighting the importance of security and AI evolution. AWS's industry-specific team helps navigate the changing retail landscape. Testi... Read more

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What are some of the key considerations when thinking about the end customer experience, whether in store or online, and what tools and data are needed to achieve the desired outcome? add

What were some of the key topics discussed at NRF this week? add

What are some key considerations and strategies for driving new revenue and accelerating revenue growth, particularly in terms of providing data-driven solutions or services and prioritizing security in the current market environment? add

What are the sectors you work in for business development worldwide and what is the day-to-day like for you and your team at AWS? add

months that we need to have plan now for when we have changed in 3 years how our machinery thereafter then could be making more from the AI-generated data and models than they do from machinery they already have prelim or of have ordered. add

What are some of the priorities customers are focusing on in regards to AI that will drive confidence and revenue growth? add

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Justin Honaman, AWS

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>> Hello, welcome back to theCUBE. I'm John Furrier, your host with Dave Vellante. This week for our media week, this is our NRF coverage, essentially retail week here in New York. Everyone in the retail industry vertical is here and it's exciting time to bring in technology. You got obviously devices. You got AI, like healthcare, a lot of IoT on this show over the years now more than ever. Software cloud scale is changing the game. We've got a great guest. Justin Honaman is here. He is the AWS head of worldwide retail, restaurants, and consumer goods for AWS. Justin, great to have you. Thanks for coming in. I know you are super busy doing hundreds and thousands of meetings. This is your show, this is your Super Bowl.

Justin Honaman

>> It's a big week for us. Retail week here in New York around National Retail Federation's Big Show. For us, it starts almost a week in advance or right after CES. So many retailers come to town early to meet with us. Especially the global retailers, they'll come in early. We'll spend time with them. And then of course during the actual show, I mean it is a couple of hundred meetings with retailers and also our partners and then it continues. You asked before we went on the air here like are we wrapped up, but no, it actually goes for a couple more days for us.

>> Yeah. And I know there's tons of meeting rooms. I saw Amazon Web Services got tons of meeting spots. So I know the retail is big. I have to ask you because one of the themes that we've been seeing coming through theCUBE here as part of our coverage is we're entering a new era of scale, certainly cloud scale. I call it gen 2. I think people hate that word and even say, "It's no gen 2, cloud 2.0." But you're seeing the SaaS ecosystem grow up so much now that you got platforms with the data layers and all this AI coming in. You have essentially now a new level of scale that's enabling a huge ecosystem boost. And the value of these devices at the edge, the retail is like the edge, and then you've got the first party face-to-face in-store, physical brick and mortar as we know to call it, with digital coming together as first party, symbiotic coming together as one experience. So that changes a lot of assumptions, databases.

Justin Honaman

>> That's right.

>> Things now, identity. I came into the store, now I'm online. So the marketers are looking at this saying, "Hey, if I'm a brand in retail, I want to know who's touching my product," and if I'm retail, I want to know which channels are going to go. All this has kind of been around, but now with cloud and AI, that's abstracting away that complexity.

Justin Honaman

>> That's right.

>> There's a huge acceleration going on now. One, do you agree with that and if so, what's your perspective and reaction to it?

Justin Honaman

>> Yeah, so we've really seen acceleration in the last 18 to 24 months, especially in the movement to cloud. So most legacy, I'll call it, retailers or consumer goods brands are still early days in moving to cloud. So they're still on-premise. They have disconnected systems that you just said. They're interested in what's called unified commerce, so the idea of I've got stores and I've got e-commerce and how do I connect that experience for an end customer, not easy to do with legacy technology. And so we've really seen an acceleration along the lines of the growth of generative AI. And so if you want to take advantage of things like AI, you really got to be in an environment that's flexible, scalable where I can spin up capability or take off capability very easily. And that's where cloud really has played a big role.

>> You guys are enabling that. It's awesome. It's really the goodness of cloud going next level. It's really next level stuff. And certainly, people see the value of generative AI and now is out implemented. So the question I have for you is, is AI ready for retail and is retail ready for AI? Because a lot of times, a lot of these industries where now there's a second renaissance going on, they're moving from either old-old school, archaic, inadequate, antiquated stuff to modern IT to now they've got super modern, they've got to have more cloudified and AI modern with Agentic right around the corner. So you have that spectrum of customer base you guys must have. Is retail ready for AI, and is AI ready for retail and where are we on that?

Justin Honaman

>> Yeah, we work with the vast majority of retail and consumer brands worldwide at AWS, and I could map each one of those brands on a spectrum of either very forward leaning, already moving quickly into AI, have more flexible data platforms. They have the people that know what to do. And then as I was sharing with you before we walked in the door here, there's two brands I met with this morning that are early days. They're still stuck in very, very old technology in an environment where the idea of even leveraging AI, let alone generative AI, let alone Agentic is like it's almost too far off for them to think about. But what they want to know is, hey, what's possible? What should I be thinking about from a brand perspective? And so they can be roadmapping to that.

>> What I love about retail, again, we don't cover retail. We haven't really covered it in-depth because of the retail is not in our swim lane in terms of the merchandising and all this stuff. Omnichannel market has a data piece to it, analytics. But now with AI, you have this whole new layer of value creation where it's an IoT device, camera, computer vision. You're seeing more video in-stores, you've got that perspective. What are you guys seeing? What are you guys talking about with your customers? Because now customers can see the value of going from either antiquated or even somewhat modern stepping up into cloud immediately. What is the conversations like? What are you guys talking about at the show?

Justin Honaman

>> Sure. So AI has been around since the '50s. It's not new just in general and in fact, it's built into many of the things we do at Amazon. It's part of our fulfillment center operations. It's part of the Alexa devices that many of your viewers might own. It's part of how we fulfill orders in the Amazon Go stores here in New York City using computer vision and sensor fusion. So AI is not new. For many of our customers, they want to know how should we be using it? What are the possible, to use the old phrase, and then also what's versus what's ideal? As you get into generative AI, we just launched a whole new set of models called Nova, as you're aware. So beyond just text, now the creation of images is super powerful. And then the thing we really see this year even moving very quickly is the ability to do short form video. And the quality, the clarity, the accuracy of it, and you don't have to be a developer to take advantage of some of those capabilities.

>> What are some of the use cases that you're seeing? Because what I love about retail too, payments are involved, so money. So you got to make moves and transactions. Trust as well as security is required there. You got cloud scale, you got data, all those things we just talked about. What are some of the use cases that you guys are seeing from your customers as you work backwards and try to bring them some of the goodness of AWS?

Justin Honaman

>> So the words you just said there are key to us, working backwards. So when you think about the end customer experience, whether it be in store or online, what does that look like? What do you want it to look like? And then what data do you need and then what tools do you need? Sometimes, it could be not an AI solution that helps enable that experience. Where we've seen the most impact in retail with generative AI is in things like in e-commerce listings and ad words and titles and keywords and the descriptions. It's in creating images of product in different locations that you couldn't do before without using an agency. It's on the IT side in terms of coding, the quality of coding, making it so that you can use these models to understand what's in code, and then the QA of it. I think we were talking about offshore development earlier, that's a powerful new tool. New product ideation, we have a major retailer in the shoe space that's using these models to come up with all different types of new footwear as the top end of their innovation funnel. So a lot of these though are operational efficiency plays or cost savings plays, but what's interesting is to see how quickly our customers are getting in and using these models to come up with new ideas.

>> What's the story that customers are hearing from you guys when they say, okay, AWS, some people are customers, you have a lot of customers in retail, some people coming on board. You mentioned from the laggers now to the innovators. What are the capabilities that you're offering them? You mentioned ads are new. What are some of the new stuff? Take us through kind of the capabilities.

Justin Honaman

>> Yeah, so a couple big things this week at NRF we talked about first of course, like I mentioned, generative AI and the integration of that and things like an entire marketing campaign. The second area you just brought up is in Amazon advertising, a powerful platform for Amazon in that business. We've taken the engine behind that and created a new service called Retail Ad Service and just launched that this week, so a retailer can actually leverage the power of the engine of Amazon advertising to apply retail media on their own site. Pretty powerful. And then the third area that we talked a lot about this week is in the digital experience. So things like AR, VR, virtual try-on, just all of that is now more readily available versus kind of a neat and interesting idea. So again, all of that helps to improve the customer experience. What we want to be known for I'd say with our customers is innovation, new thinking like the culture of Amazon. That's what we're built on and we bring that over and above the tech.

>> Andy Jassy uses the word inventive and always be inventing. There's a lot of leadership out there that's coming into the industry that also you have some older school leaders, but the common trait on most of these entrepreneurial thinking inventors in retail, they're curious and they want to invent. What's your advice to leaders? Because now, they have to tap and marshal that resource now. The demand on leadership is super important because the consumer experience is the end game here.

Justin Honaman

>> It is.

>> And integrating those personal experiences and enabling that is what your customers are trying to do. What's your advice to folks out there who are looking at projects, they're looking at large scale? We just saw that re:Invent News, the infrastructure is scaling up beautifully and have more performance needs. The cloud delivers the payload and performance, but now when you start putting these applications out there, the leaders of your customer base have to think differently and invent. What's your advice to them? How their mindset should be? What should they be more curious, be conservative? What is the general mindset and posture you would offer to them to think about?

Justin Honaman

>> Yeah, so there's no question that the leaders, the ones that are successful, the ones that are moving faster, the ones that are innovating quickly are the ones that have decided that technology is important, that technology is not the IT group down the hall or in another building, that technology is part of everything you do and needs to be a priority. And there are many leaders that now are not bought into it, but are investing with their businesses that way, and they're the ones that are differentiating themselves. Also, the idea of data, you can't do much without data and clean data, so it's got to be a priority. So the leaders that are leaning into those areas are the ones that are really, I'd say moving their innovation agenda faster, and they're also the ones that are leaning into companies like Amazon looking for, hey, we have the agility of a startup, but the experience of the enterprise player, that's powerful. And so that's where we really help by bringing that mindset to the leaders that are really trying to advance their agenda.

>> I always thought that Amazon Web sort of always had that philosophy of being more innovative in the thinking. Are there anything that you're hearing from the customers as you're on the floor in meeting rooms with customers this year or in general around some of the things that they're top of mind in their world right now? Is it revenue pressure? Is it data abstraction? I mean, Swami had a great keynote at re:Invent around how some of these new data layer abstractions are working, how fast in real time, you got automatic coding, the creativity of the human. I'm imagining in retail that's going to spawn massive new invention.

Justin Honaman

>> Yeah, there's a lot of growth happening in the industry right now. So many of our customers are opening stores and think about the global nature of many of our customers, that's important that we help support them there. As you think about security...

>> So, growth strategy.

Justin Honaman

>> Growth strategy, I mean not cost savings strategy. We're seeing a lot of interesting growth and how do we drive new revenue? How do we accelerate revenue growth? And so what is it we can provide either from a data perspective or a solution or service perspective to enable that? Security is a huge priority right now, especially with the growth of AI, right? There are many threats in the market to companies around data and their systems. Security is our number one priority, especially AWS, where we're enabling customers or the experience of customers through the major retailers we work with. And then I would say as we're working with customers, bringing new ideas around customer experience beyond what they might be thinking about in their own bubble. I've been on the industry side as a customer, I know how hard that is to break out of your thinking. You know what I mean? And so, one of the things I think we do a good job of is bringing the creative nature of new ideas to our customers, and that's something that's powerful.

>> Yeah, it's hard to affect change when you have institutional dogma or you're locked in, this is the way we've always done it. Moving that mindset over to, okay, let's get some experimentation going, let's do some pilots. What is some of the tactics you've seen your best customers do when they lean in with AWS in retail?

Justin Honaman

>> Yeah, so I always like to say the culture of the organization unconsciously conspires to maintain the status quo. Even though many companies will say they want to change or they want to invest in new the culture, almost it can be difficult, especially a major brand or one that's been around for many, many years. So we find that those that have put together either someone or a team to own innovation, to have a mindset around innovation, to have a method and process around innovation, to kind of force out of your legacy thinking I'll call it are the ones that are successful. And then with us, yeah, they're leaning in to us for ideas. They want to know what's the next data platform, what's the next e-commerce experience, what's in store, what's going on in store that they should be thinking about? So those are things that our customers come to us to learn.

>> Justin, I have to ask you because you just got a fascinating job. One, head of worldwide retail, restaurants, and consumer goods, that's a huge swath of responsibility in an area. Obviously it's all kind of the same thing, edge and the customer experiences. What is it like day to day in your job? I mean, take us through a day in the life, I mean besides all the documents you have the right inside Amazon. You're out talking to customers, driving a lot of the business growth, obviously transformation is top. You got food and beverage, that's probably a different animal than say retail, consumer retail. Food and beverage may be a little bit different. What's similar and what's different? You got supply chain, all these things come up, analytics, reporting, ROI. What are some of the day-to-day things you work on tackle with customers?

Justin Honaman

>> So I work in business development worldwide in those sectors. So when you think of retail, that could be fashion, apparel, health and beauty, grocery, drug, convenience. Consumer goods, you think of the major food and beverage companies as well as fashion, apparel and others. We do, we have food service. The vast majority of food service providers run their business on AWS, and then recently we brought over QSR. So what's the day to day for me like? My team, I have an incredible team. They all came out of the industry. So at AWS the last couple of years, we've really doubled down on industry knowledge and experience because we know if we walk in with a customer and can speak their language, we can help them get to solutions faster. And we also have salespeople that are now part of these industry verticals and they also are up to speed on the industry, and the solution architects are also aligned to industry. So when you think about our business from an industry perspective, not only are we bringing in this leading technology and capability and thinking and the culture of Amazon, but now match that with really amazing experience coming from the industry. And we're really able to fast-forward many of the conversations with customers because of that.

>> If you look at the waves of innovation in retail, what's the key moments where you had to kind of like, are there defining moments, and I think we're in one now but I asked you. Where are we now and what are the key moments in the retail industry and say, this moved the needle, this changed the game because I think gen AI changed the game significantly.

Justin Honaman

>> Yeah. We look at generative AI as truly as important of technology as when cloud was launched, I mean in other technologies by the way were launched. Think of internet and whatnot. It's that significant and for many of our customers, they're trying to understand how to take advantage of it or how do we thinking of it, how do I take advantage of it now, the capabilities now? But also, how do I start to prepare myself or our business for being able to use these models and the capability going forward? It's already moved so quickly in just let's say 18 to 24 months from, what is it? Customers were like, "Tell me what this is. Why should I care?" Boards wanted to have means on this. Eight months later, we launched Bedrock, or even less time than that. We launched our own Bedrock platform for our models. Customers are immediately testing different use cases. Couple of months later, we've got valid use cases. Couple of months later, not only are they use cases, like they're in production and many of our partners are integrating these models into their capability side.

>> In your own experience, has there been other intersections with tech that you've seen change the retail industry? What could you point to as reference? That's obviously internet, I mean point of sale, devices. I mean, I guess I'm just trying to frame the scope of the magnitude that we're in now.

Justin Honaman

>> Personally, you all don't know my background. I spent a lot of time in consulting as well as on the industry side. I have not seen anything move as quickly as generative AI from the concept to capability to using the capability. I believe the technology is moving faster than most of us can keep up with, is moving faster than companies can keep up with, is moving faster than governments can keep up with. So it is changing daily or weekly. I see it in my content that I share with customers. It's changing so quickly. I've never seen anything like it.

>> So it's pretty unique.

Justin Honaman

>> It's significant.

>> It's almost a black swan event in and of itself. So I have to ask you, so I mean obviously enthusiasm is high for AI. Confidence comes down to, okay, what's in production, what moves the needle on revenue, whatever my goals are? What are some of the priorities that you see customers working on that's going to drive the confidence value, move the needle? I mean obviously growth is their business, but what areas? I need to see more security or is it resilience? Is it cash? Show me, is it user experience for people in the stores, in the value chains? What's the key?

Justin Honaman

>> Yeah, I'd say as it relates to AI and generative AI as part of that, I mean you mentioned customer experience, that's an area that we're already seeing significant opportunity for our customers and they're finding value. A lot of it is cost savings or efficiency, but significant value. I'd also say in sourcing and procurement, the ability to go through contracts and manage contracts in new and different ways, significant. In new product development, significant. I mentioned the shoe example earlier. We had an example here at NRF around how you can literally design new products using generative AI in seconds and minutes. So you think about the volume of new concepts that you could then put into your funnel, powerful. And then in the technology space, it comes back to things like coding, as I mentioned, and the ability to really take legacy technology and move that to a new space quickly. You mentioned security that it must be considered. And so as companies are evolving their data platforms and what's accessible, security's got to be a big part of that. And for some reason, that often is left out of the conversation because there's so much hype and excitement around images and video.

>> Well by the way, there's more devices on the network, so you need to have absolute security at the end points.

Justin Honaman

>> Correct.

>> For sure. Okay, so as someone who's been in the industry, I always love to ask this question because one of the things that comes up is that you got to run a business. So you're always talking to customers.

Justin Honaman

>> Yes.

>> So you are towing the top retail across multiple sectors. What's your plans for the year and what would be the pitch? I mean, not saying give the pitch, but I'm sold on Amazon, I want scale, I want revenue, I have to run hard, I need a partner. What do you say to the folks? Say, give me the pitch, Justin. I really want a transformative five-year plan. Why AWS?

Justin Honaman

>> Yeah, I feel like that was my morning today with two different customers.

>> Pull the string, let's go.

Justin Honaman

>> Actually really one an existing customer and one literally net new, which is we don't have many of those because we do so much work in the industry. But A, we are born from retail. AWS was born in 2006 as the platform in which Amazon.com was built. So that capability is one that most of our customers want to take advantage of. We were first to cloud, there for six or seven years, there was no other player. So that's significant. Number two, many of the services and capabilities that we have launched are born from the retail side of our business, whether it'd be physical store or e-commerce. So we're bringing those types of services to life for our customers. I mentioned our industry business model that is unique. We don't talk about the competition, but our customers are telling us how unique and differentiated that is and the consistency in our team.

>> In what specifically?

Justin Honaman

>> Because, well, the knowledge of industry, the ability to understand. When they share what their business problems are, we're not pitching technology, we're solutioning.

>> You're not doing the headlines either.

Justin Honaman

>> Not at all.

>> You guys know retail.

Justin Honaman

>> Our entire team, if I were to go down the list for you, came out some aspect of retail or consumer goods or food service, right? So, it's significant. And so I think those are the types of things that our customers appreciate. Also, they expect Amazon to bring the innovation mindset in like some of the ways of operating. And we do, we will write a press release about our future capability and then back into that so that back to your, what's a one- to two-year roadmap to get to that big idea? We'll use the decision-making process around one-way or two-way door. So a one-way door is I got to build a new data center. It's a big investment. We're going to make the decision and build it.

>> One-way door, meaning it's hard to get back through.

Justin Honaman

>> Exactly right.

>> A two-way door means you can test it and walk it back.

Justin Honaman

>> A great example would be like a major beverage brand launches a new beverage product, it works great. If it doesn't work, you kill it. That could be a two-way door.

>> And by the way too, a lot of the solutions out there, the clients get a thousand paper cuts. So kind of like I mean, you got one-way door problem, you got all these paper cuts. I mean, you could bleed to death and nobody wants a black box if they have a homegrown solution.

Justin Honaman

>> Right. Well, and the nice thing about cloud is most of the time you can't break something the vast majority of the times. You want to test out a new model on data, test it out. If it works, commercialize it. If it doesn't, shut it down. Great example of a two-way door.

>> A lot of times I hear people say, "Just let that sleeping dog lie right there. Nothing's going on. We're cool. Let's move on to the other priorities. We're too busy, we're up and running." Because sometimes, you don't know what you don't know. So in retail, what would be some of those things that might be hidden, the iceberg under the water so to speak? You don't want to hit that. So as you look at where we are now, because where we are now is a completely different place than we were five years ago.

Justin Honaman

>> That's right.

>> Maybe someone in five years says, "Hey, we already transformed. We're good." We're in a different place right now. What's that iceberg under the water? What's the sleeping dog who thinks everything is good, sitting there, lying there?

Justin Honaman

>> I'd say one example of mistakes that a customer might make is getting too enamored with either the tech or their own products, they lose focus on the customer experience. And so that's a significant mistake because at some point, you lack alignment. You lose alignment to what the customer is looking for, and the customer goes somewhere else. So I'd say a maniacal focus on customer and the experience of that customer and then backing into all of the capabilities that can enable that is significant.

>> So all these conversations get me thinking about how Amazon culture is. I'm covering Amazon since 2013. I have to ask you, do you guys have a culture of what they call bar raisers?

Justin Honaman

>> Yes.

>> Okay, which is a term that if you don't know, it means it's always raise the bar. What would you say to me if I was a customer saying, "Justin, how are you going to help me raise the bar? What are the bar raisers for my business?" How would you encapsulate that down?

Justin Honaman

>> I am a bar raiser.

>> Are you a bar raiser?

Justin Honaman

>> Yeah, we have an official...

>> I mean, what does that mean? It means you hire, it was for hiring or is it more of an innovation?

Justin Honaman

>> I like to think of the bar raisers as the culture keepers. So we have a significant, or we have a set of leadership principles that we use when we screen candidates to hire, when we run through our interview loop process. When we do annual, I'll call it our review process, all based on leadership principles. When we engage with customers, we're using those leadership principles. When we're doing working sessions, we'll couch things with the leadership principles. It is so unique and our customers see it come through. It is something super unique about our culture and what I love about it is it keeps us, it kind of provides the guardrails to ensure that we continue to bring the innovative thinking but also we're challenging customers to go the next step-up.

>> Is the bar raiser like a taste tester, like the taste maker, the chef that tastes the meal? Or you keep an eye on the culture? Or are you test-

Justin Honaman

>> It's our job to make sure we're not settling, we're not settling for the status quo. Are we above 50% of others, for example, that are doing something similar? We're thinking about how do we keep the culture moving and not, again kind of getting into this, we call day two thinking. We like to say we have a day one culture. Every day is day one, that we are thinking about the customer experience from a new and different way every day. The leadership principles are guardrails and really provide the framework for us to be successful in innovation.

>> So what's the bar raiser feature for me as the customer with AWS retail? Performance, revenue? How would you...

Justin Honaman

>> Yeah, there's core cloud capabilities that are very strong, right? We don't need to really talk about those, but as I mentioned earlier, the fact that you're working with industry leaders, the fact that you're working with industry partner leaders and capabilities that are game changer in retail. And the fact that we've got such a good method and mechanism to help you move faster, I think that's something that's significant.

>> Well, Justin, great to have you on. What I learned was raise the bar.

Justin Honaman

>> Raise the bar, right.

>> Don't die by a thousand paper cuts and keep innovating. I mean, you want to make sure that you are, don't go through those one-way doors.

Justin Honaman

>> I know it's not easy though. I'm telling you, the culture, remember. Organization culture is a drag for some companies.

>> Well, great to have you on our new studio here on the East Coast.

Justin Honaman

>> So cool.

>> Here at the NYSC, they're about to ring the closing bell. You missed it by a couple of minutes. Our next guest will be here at the bell ring. Thanks for coming on and-

Justin Honaman

>> Thank you....

>> congratulations on a great show. I know it's not over for you. You got more meetings and dinners. Thanks for coming on. Head of retail with AWS, sharing what's going on in his world, and of course, what's happening at NRF. The retail business is being disrupted in an enabling way as AI is coming in and giving a real forcing function to the innovation, raising the bar. And the business transformation is going to a whole next level. I'm John Furrier, your host of theCUBE. Thanks for watching.