This episode of Retaili$tic features a live conversation from the Shoptalk Fall event, focusing on the key themes of AI and tariffs in retail. The discussion highlights the evolving landscape of retail, the impact of AI on operations and marketing, and the importance of innovation during challenging times. Insights from industry leaders provide a comprehensive overview of current trends and future directions in the retail sector. This conversation delves into the evolving landscape of retail, focusing on the shift towards experiential retail, the transformation of supply chains to meet Gen Z's demands, and the changing dynamics of loyalty programs. The discussion highlights the rise of live streaming as a marketing tool, the impact of the attention economy on consumer engagement, and the future of AI in commerce. Key insights include the importance of creating memorable customer experiences and the need for retailers to adapt to new technologies and consumer behaviors.
Takeaways
Coresight Research provides insights from major retail events.
AI and tariffs are the two main topics in retail discussions.
Retailers are adapting to tariffs by innovating their supply chains.
Generative AI is changing content production in retail.
Retailers are focusing on data-driven decision-making.
Physical stores are regaining importance for younger consumers.
Innovation thrives in challenging environments.
Boards are increasingly educated about AI's potential.
Private label demand is rising due to tariffs.
E-commerce growth is expected despite tariff uncertainties. Experiential retail is essential for modern consumers.
Digital enhances the tactile experience of shopping.
Supply chains must adapt to the rapid changes in consumer behavior.
Gen Z values sustainability in their shopping habits.
Loyalty programs need to evolve beyond traditional models.
Live streaming is becoming a significant marketing tool.
The attention economy is reshaping how brands engage with consumers.
Retail media is increasingly becoming the dominant form of media.
Emotional connections with customers are crucial for brand loyalty.
AI will play a pivotal role in the future of commerce.
Chapters
00:00 Introduction to Retaili$tic and Shoptalk Fall
04:14 Key Themes: AI and Tariffs in Retail
14:00 Exploring AI Opportunities in Retail
19:33 Innovation Under Pressure in Retail
20:48 Experiential Retail: The New Paradigm
21:44 Transforming Supply Chains for Gen Z
24:19 Evolving Loyalty Programs and Customer Experience
27:10 The Rise of Live Streaming in Retail
30:22 Navigating the Attention Economy
32:11 Innovations in Retail Technology
36:31 The Future of AI in Commerce
Speaker 6 (00:00.182)
Welcome to a special edition of Retaili$tic, the official podcast of Coresight Research. This week, the team has been all over the country kicking off the week in Huntington Beach, California for the RetailClub AI Retreat and ending up in Chicago for Shoptalk Fall. Members of Coresight Research can access insights and analysis from both of these groundbreaking events at corsight.com. On this episode,
We're sharing a live on-stage conversation with CEO Deborah Weinswig, Holden Bale, the Global Chief Strategy Officer from Merkle, and Ben and Joe from the Shoptalk crew to review the biggest takeaways from this year's event. But before we head to the Windy City, Isla is here from the London office to preview this week's new research.
This week, we're diving into two big stories shaping the retail conversation. First, alongside our continued coverage of the Shoptalk Fall event, we're kicking off our Innovator Profiles, spotlighting the startups you'll see on stage at Groceryshop 2025's Shark Reef pitch competition, hosted by Deborah Weinswig, CEO of Coresight Research. Get ready to meet the next wave of disruptors. Then we're turning to the numbers with our retail sales outlook for September 2025.
built on the latest August data from the US Census Bureau. It's your forward look at where retail spending is heading. Insights, innovation and outlooks all in one place.
Thanks Isla! Now let's head to Chicago for the Shop Talk Fall Wrap-Up!
Speaker 2 (01:34.318)
Well, good afternoon, everybody. And thank you for joining us in what is a bit of a Shop Talk tradition. for those of you who may be at your first show, what we try and do as a team throughout Shop Talk is try and pull together all of the strands of conversations and thoughts and try and boil it down as much as we can to kind of help synthesize the takeaways, the insights that have been shared. At this show, we've had over 40 content sessions. We've had 140 speakers, 30 hours plus of
great content. And we know you can't go to all of it. So we try and help you through and what we do at the end of each show and we know we've got some great keynotes and another meetup still to come. But this is the end of the tracks. We want to take the opportunity to share our findings, our thoughts and our takeaways. And to help me do it this time, we've got three amazing guests. So I'd love to introduce you to firstly, Deborah Vinesvick. And she is founder and CEO of CourseLite Research.
previously ranked number one as an institutional investor before founding CoreSight. CoreSight are a fantastic research partner of ours. We've worked on many shows over many years. And in fact, if you want more details, Deborah and their team produce a written summary every day of the content of the show. So on the CoreSight website, you can read those. So firstly, Deborah, secondly, I'd to introduce Joe.
You've probably seen him on various stages. Joe is our global head of insights at Shop Talk. He's got the overall responsibility for the content program of the show and the thoughts and ideas. So Joe, thank you for joining. And then on my right, I've got Holden Bale. Holden, I'm going to let me get it right. Global Chief Strategy Officer at Merkle. That's my made up title. That's your made up title. That's what we're going for. Merkle, if you don't know it, is part of Dentsu, one of the big air market holding companies. And he is a consultant, particularly on tech, having worked with
many, many large retailers. Please join me. Can you give me a round of applause for our speakers? I also wanted you to give a round of applause because we're going to record this as a live podcast. That's something else that we do at the end of each shows. On the Corsight Retailistic podcast feed, we will share this afterwards, so people who weren't able to come to this session.
Speaker 2 (03:49.602)
can listen on their journey home and pick up on the inside. So a little round of applause and feel free to whoop and holler or boo at any other points. It just kind of helps prove that this is actually a live recording. Can we hand out the vegetables for people to throw at us if they don't like their answers? No, and you're not allowed to boo either. So we're spend about 40 minutes running through the main topics. But what we wanted to do is start, Joe, if I could throw this one to you.
Can you just kind of remind us what the proposition, what the thinking was when we put together the content proposition going into this show? And then we can push up against how it's evolved.
Yeah, absolutely. as we talked with the Shop Talk advisory board, our key contacts in the industry across retailers, brands, technology companies, smart consultants and analysts, kind of the two things that everybody wants to talk about in retail right now are AI and tariffs. That was kind of it. so we kind of knew that those needed to be fairly prominent in the agenda for Shop Talk fall. But there's more to life and there's more to retail, believe it or not, than AI and tariffs. And so we kind of built
build those into the agenda, but with a few additional topics as well. And so we, we arranged the four track stages that we've had going for the last several days around kind of not, just those two things, but, four things. So, so first our air stage was focused on data-driven artificial intelligence, augmented retail intelligence, how companies are leveraging data and AI to do their jobs better. Here on the fire stage is where we've kind of featured a whole bunch of conversations around product curation and innovation in high pressure times.
Our air stage was around AI, our, what other elements are there? Our water stage was about customer attention and how companies are getting and keeping customer attention, brand identity, loyalty, customer experience. And then finally, our earth stage was around leadership, leading in times of volatility and rapid change. So in addition to AI and tariffs, think kind of product curation, merchandising.
Speaker 6 (05:48.152)
think how companies are building and maintaining their brands and communicating their brand stories to customers. And then finally, how senior leaders are designing and refining their leadership toolkits at a time when the way we kind of run our organizations and our teams is changing really rapidly.
Okay, so if that was our thinking coming in, what we now want to do is explore each of those and discover what we've heard. So let's start off a quick show of hands because show of hands always work really well on podcasts. So what I'd like to do, if definitive things were tariffs and AI, who's heard more about tariffs? Okay, there is tumbleweed. Who's heard more about AI? Amazing, amazing.
as pro
I think, universally, this has been an incredible show where there's been a phenomenal amount of conversation about AI. So therefore, let's start with Taris.
Get it out of the way.
Speaker 2 (06:38.996)
out of way. Deborah, I'd like to start with you. know you, of course, you've done an awful lot of work on tariffs and helping companies navigate what's been happening. So you've come into this show with a lot of knowledge. Can you help with what if you learn what's new, what new perspectives, what if you heard how people are trying to navigate the environment we're in?
So I'm actually going to take the tariffs turn into AI because I think in an environment where you have Gap talking about a 400 basis point gross margin hit in the third quarter and Lulu 300 basis points gross margin hit, that gives you permission to try something totally new. And so with AI, right, in one of the sessions earlier where there's this whole idea about how fast can you move?
you're going to be given the permission by the board, by the leadership team to move much faster in the wake of tariffs. And I think because there's, think Steve Yaloff talked about this yesterday, Your team needs access to so much more news because every single day, I mean, there was a while there, right? It was every single hour, but every single day there's something new that you need to know for your, you know, your business. And I think how do you disseminate a lot of information quickly, right?
AI is helping us do all that. So I think tariffs is actually giving us the permission to try things in a different way. I mean, we've had clients of ours who've put in place like a chief tariff officer, right? So this idea that, right, you've got somebody who's really understanding what's happening across the globe, right? As you're thinking about moving production from one region to another, what do you need to pay attention to? What are the opportunities? And are there, I think on the
plus side we've seen some companies get into additional product categories and on the other they found new ways of working and many of the technology solutions that are, you know, who are here, who are on the floor, how are you rethinking your whole supply chain, right? Demand forecasting, inventory allocation, but even pricing and promotion, pricing especially, right? Because if your prices are changing. And so I think that's become really interesting and we're in some ways
Speaker 1 (08:57.166)
We're at the beginning of, think, monumental change, AI-inspired, tariff-driven.
Interesting. Joe, what about you?
I guess I would just build on what Debra said, right? I think back to Shop Talk Spring in Las Vegas this past March, where Richard Dixon, the CEO of Gap Inc. was on our stage and got asked the tariff question, this was March, we were so much younger and more naive back in March, weren't we? And he was like, well, our supply chain isn't super China dependent, so we should be just fine with tariffs if nothing changes. And the week after Shop Talk Spring was when, what was it called, Liberation Day, Tariff Maggeddon kind of hit and the whole world realized,
No, there's going to be a lot more rapid change and it's a lot less certain than anybody thought it was. And I a hundred percent agree with Debra that like once the industry had a chance to kind of catch its breath, it has opened the door to all kinds of innovative approaches that probably would have been like, it'll take us eight months to develop this. Now those things happen much, much faster.
I was in a conversation with Wayfair, so we had a Wayfair track keynote on the first day, the CFO of Wayfair. One of the things that she talked about was taking this data angle and as a retailer, the amount of data you have, it is the opportunity to change the conversations you have with your supply base, i.e. how can we help you find alternative supply? How can we help you find alternative demand? What product changes can we make? So how do you use that data in a different way to have a different form of relationship with your supply base and that to navigate tariffs?
Speaker 2 (10:19.694)
which was really interesting. Holden, what have you heard about tariffs? What have you learned? What takeaways? I think there's a funny connection to AI, which is some of the Liberation Day tariffs. think some people suggested ChatGPT helped them with that. I there was like an island in the South Pacific that has 12 sheep that had like a 700 % tariff or something. You know, I think some of the conversation has been around...
What does price elasticity of demand look like for certain goods? I don't know if anybody's tried to book a Delta flight recently. I'm a Delta flyer. The cost to fly from Des Moines to Sao Cuccos has now gone up by $700,000 because of automated pricing algorithms. Is everybody's going to be renting cars? What's that sort of secondary adjacent category? But what's changed very dramatically from 2008 is that the wealth divergence has continued in this country, right?
And so we're seeing certain products, things we would expect around travel and hospitality, stay pretty sticky. And we're seeing the growth curve still look pretty good for those products. So if you're in core basics or if you're in commodities, yes, there's going to be price sensitivity. Yes, there's going to be shrink inflation. But I think a lot of companies are struggling with the trade-off and certain sensitivity metrics because they're operating on insights on consumer behavior from what? 10 years ago? 12 years ago?
And the makeup of the populace, especially post-COVID, looks different. And their purchasing behavior does look different.
I can't let this moment go and I know it says Teravers on the screen and I think we're supposed to talk about this later. But what we've heard and from the show floor here was I think almost every retailer we spoke to is the change in private label demand. they're right for them it's a win-win, right? Because the consumer can only get it from their physical stores or online and it's much higher margin. And so that to me has been, I don't know if I necessarily am, you know.
Speaker 1 (12:11.598)
although you know I spend a of time doing research. I'm not sure if that would have been my logical conclusion on what would happen as a result of tariffs, but it has really changed how retailers think about their mix. We're talking to retailers literally out here who a year ago were at 10%, 30 % private label penetration now. It gives you a lot of margin to play with. Happened here at Shop Talk.
Yeah. Before we go to Tariff Holdings, you wanted to just quickly talk through this slide, which is the forecast for what might happen to e-commerce. Yeah, I did. This was from EcommerceDB and Friedrich, who, you don't know, was the founder of Statista, which for consultants like me is the reason that we're able to make PowerPoint slides most of the time. Thank you, Google and Statista. And so I think what's interesting is the initial e-com forecast for growth pre-tariffs was around 8.2 % in the United States. And with tariffs,
there's kind of an uncertainty matrix around this. So it comes down about 1.5 % off that 8%. But there's an additional layer. he's tried to model this low versus high uncertainty. But it's very interesting to see because the tariff regime and a lot of the policy hasn't been steady. If it was just, here are the tariffs, I'm going to lock it in. Here's what they're going to look like. They expected a 1.5 % decrease in that growth rate. With all of the uncertainty and the constant change,
It's down an additional 2.3%. And I just think it's an interesting story because we're still expecting to see pretty significant, I would say, e-commerce growth in the United States. you wonder what would happen if some of that uncertainty starts to work its way out of the market. So now we're forecasting something around 5 % growth for the US market. Interesting. Interesting. OK, I'm going to move us on. AI, there's been a talk at the town. It's been a talk of the show.
I think our challenge therefore is to say, have we learned this new? So Holden, let me start with you. What do you walk away from Chicago having learned about the AI opportunity in retail? Well, I think the first thing to recognize for all of you, because all of you have been doing it, is AI is not new. right? You've been using demand forecasting tools. We've built machine learning models for very large retailers to optimize their truck routing algorithms so they can try and match Amazon's delivery SLAs. The emergence of generative
Speaker 2 (14:30.572)
which is definitely solving a content problem. Because what's the two most expensive things about selling stuff on the internet? It's shipping costs, but the second most expensive thing might just be getting the skew on the website. It's content, it's production, it's studio, it's getting the right data in the right place and feeding the right data to the right things like Google and TikTok and all these algorithms. And I do think what we're seeing with generative is it's going to solve the content problem. But I made mention of this in a presentation yesterday. I'm reminded often of a John Wooden quote.
which is never mistake activity for achievement. And so there is a lot of posturing and there is a lot of AI whitewashing and you talk to vendors and does everything have AI in it? Of course, everything has AI in it. Everything we're doing is AI. So I think being very, very clear on what are the biggest problems in your business? Is AI a tool in the toolkit that you help you solve for that or not? But I will say what I'm seeing around content and content production is gonna, it really is gonna change the internet. I don't know how else to say. Fascinating.
I mean, Debra, it's a topic you've been very close to. You chair an AI council at CoreSight. What have you learned in Chicago around AI?
I think it's twofold and the opportunities that many folks are looking at are marketing and inventory. And marketing they're looking at because if you think about it, we're midway-ish through September, so let's call it, have three and a half months between now and the end of the year, they probably can do a POC and see some kind of results that are measurable. I think there's this idea of we can try something, it may or may not work, but we can measure it really easily.
and we can lean into it if it works. On the inventory side, going back to tariffs, lead times are a bit longer, but we've talked to folks who either are having challenges around sizing in physical stores, around too much of one thing and not enough of another, kind of even in their warehouses. And so you're going back a bit more in time, unless you're gonna air freight, but this idea around inventory allocation and demand forecasting,
Speaker 1 (16:34.88)
and really solving for ultimately waste. But there's also opportunity to go further back in the supply chain as well in terms of even, if you think about it, even like fabric and material sourcing. So I think that we're going to see two areas where there's going to be big areas of kind of domain expertise. And once we have that, like I said, I do think, and we'll talk about it a little bit later, there was a lot of content on stages, which I hadn't expected.
on the marketing side here, which I thought was really interesting. But I think it goes back to people like, and boards are also, I think there's, a lot of folks will say that the boards don't know anything about AI. I think the boards are really pushing for more to be done. And then what we've heard, which is really interesting, is that in some organizations, CTOs, CIOs, CDOs are actually doing board level education.
So if the board is getting more educated so that when they make suggestions, so I think a lot of this is board pressure to have something done in 25 and then a real roadmap for 26.
Interesting. Joe, what have you heard this news?
I guess a couple of things, right? think, I think companies are now starting to think less about AI, this, this amorphous does everything thing and think much more in terms of practical applications. And I think, you know, in terms of like the shopper side of the universe, you're definitely, there's a lot of very, very careful thought going on right now about how are customers finding my website? How are they finding products on my website? And, and there's wide awareness that even though it's low today, it is super fast growing. How many people are turning to
Speaker 6 (18:09.186)
perplexity or Claude or chat GPT when they're looking for a product. so, you know, kind of that, optimizing your product description pages and whatnot, so that the chat bots find it credible is super, super important. on the customer facing side, we had a session yesterday about how people are rejiggering or rethinking search for an AI era. And I think that's going to be a hot topic for ages to come. But then I think there's also just so many like small applications where AI makes a measurable improvement. And I think, I think the best thing I've heard so far is like,
ask yourself the question, does it make things simpler for whoever is going to be using it? And if the answer is yes, then do it with AI. If the answer is no, then maybe don't do it. Anne-Marie Campbell on the main stage yesterday talked about this, of a dumb application of AI where it makes their pro sales team better because it turns their analytics of a customer visit into a podcast. All their sales team does all day is drive from one customer to the next. They don't have time to read even a two page like ChatGPT summary, but they have time to listen to a
a text to speech like podcast version of that summary. So super simple, makes somebody's life easier. is great at that.
And a great, a great, no you can't because we'll just talk more about AI and we've had a lot of AI conversation. So I'm going to move us on. I want to talk about innovation and innovation under pressure was one of our big things, one of our big topics. And it's actually covered a whole range of areas. Joe, kick us off on this one.
Yeah, I mean, think there's nothing like challenging times or constraints to unlock creativity in the minds of leaders, of creative people, of people who like embrace moments like this. I think one of the things that stood out to me is like how many things that kind of seemed a little old fashioned to me feel like they're back in style or people are looking at them with new eyes. mean, a lot of people, there's a lot of talk about physical stores now and I don't ever think the physical store died. So that's not quite.
Speaker 6 (19:59.704)
where I'd go as an example, but the mall, like there's quite a bit of talk about the mall being newly relevant for younger consumers and being a place where brands can interact with them. Maybe the role of a store in the mall isn't what it was 10 years ago, 20 years ago, but malls are important and having a presence in malls is important. So that's kind of an innovation.
Holden, you had a stats about this. You know, I, as somebody who doesn't trust stats, even though we do a lot of research, I think what's on the screen for folks listening is we did some research with Gen Z, like everybody does. And we look at self-reported data and it wasn't just that Gen Z at 81 % said they prefer shopping in person to offline, or excuse me, shopping in person to online. It was, that was more than every other generation, including Gen X and Boomers.
What nobody wants is boring retail. Like nobody wants to have a crudely crappy experience in a store. People want experiential retail and that changes the paradigms by which you think about attribution for stores, which I know is something we're gonna talk about. But I just feel like this is so contrary to a narrative of like most of us, including me, grew up in e-commerce and there's such a false dichotomy still between physical and digital, even though we kind of pretend we've solved for Omni-channel.
And for most people, they want to have the tactile experience where digital is a force multiplier for that. Digital is not a replacement for that. Yeah. It's been noticeable how much talk about nostalgia has been a full cycle. Comments about the 90s and 90s trends coming back. So I'm going to move us on because if we're not careful, we've got a British middle-aged man who will start talking about Oasis. So we need to move on past that. Deborah, you wanted to move the topic in another direction.
talking about planning cycles and lead times. And we've got a child that kind of illustrates from some research you've done. Share what you've heard in that space.
Speaker 1 (21:52.622)
So was really interesting and a lot of the meetups was this idea around how do we start to really change supply chain and going back to this idea, right, we're moving from omni-channel to unified commerce and with Gen Z very focused on touching the stores at some point during their journey and really the customer being in the center, how do we start to really kind of change lead times?
because the consumer is changing at a pace we haven't seen. And so this idea around customer to manufacturer, the idea is that when it's identified that the customer is focused on a new trend, when they're ordering something, especially when they're ordering online, many retailers and brands now are not making product until it is ordered, right? And if your supply chain is agile, short, of digitalized enough,
you can get that product to the consumer and they're willing to wait. And so it's really interesting, right? Some retailers have talked about this idea, right? All of our promotions are planned because we don't have stock sitting in warehouses because literally we're not making things until the consumer is ordering it. And so this idea that this transformative idea around manufacturing, kind of pre-positioning raw materials is completely changing. And so let's say you have raw materials and
this is a fabric or this is a print that your customer is interested in, but the silhouette changes, you can be very responsive. And so there is not a lot of dead stock you're seeing. And I think it goes back to this, as we were planning here, The Gen Z consumer embodies sustainability, even if they're not aware of it. And so I think that the way that they shop, going to the physical stores, right? Looking at the product, is this the right color? Is this the right fit?
They are shopping in more sustainable way, even I think if they're not, they're of it.
Speaker 2 (23:50.318)
Yeah. And I think it's been fascinating that this takes us right back to that first conversation about what are people doing around tariffs and it's kind of alternative sources, supply has been able to change, supply has been able to change countries really quickly. All the changes around Diminuous and not diminishing the appetite for conversations around manufacturing to consumer, which I think is super interesting. Let's move it straight on because the next area we wanted to talk about was loyalty and customer experience. And Holden, this is your bag.
This is your specialty. What's the latest thinking and how is that thinking being altered by what you've heard? For the last couple of days. Yeah, I mean, look, I think if we're honest with ourselves, the brilliant basics and customer experience are things that we've known for a long time. Don't send somebody an email about a product that they already bought and returned that they hated. Here's the new promotion for that. There's a slide up for those listening that looks across different age cohorts and
You find that boomers happen to be very needy for different things. They want free shipping. They want their points program. They want their discounts. They want personalized offers. But a lot of that is true across all age cohorts. I think what we are seeing is, and maybe you all feel it. I don't know what you feel, because you're all consumers. You're not just business leaders. Is a little bit of of exhaustion with loyalty programs.
And it being such a foundational basic in terms of like earn and burn transactions. So we build a lot of loyalty programs, but we also do a lot of experiential loyalty at Merkle. And what we're finding is the things that you have to do to cog and prime behavior have really changed. And in the same way that we thought about experiential retail, and I know this is coming up in luxury and shop talk Lux to throw a little bone that way. In luxury, this is an enormous problem.
because when you have these brands that are just constantly one up in each other, it's like, what comes next? But also if everybody has a points program, not to be too philosophical, then nobody has a points program. So what are you doing to differentiate that? think personally, besides AI, certainly important and some of the creator economy stuff we're gonna talk about.
Speaker 2 (25:57.57)
That is the foundation of building a flywheel. For a lot of our clients who are most successful, loyalty is a flywheel. feeds into paid media and optimizing audiences. feeds into re-engagement. It feeds into customer lifetime values. I think that is the space for innovation the next two or three years.
Well, I think, I actually think that depending on where you are from a household net worth and right, you're seeing like ultra high net worth individuals, they're now focused really on convenience. And so I think really understanding your cohorts and what is loyalty, what is value, what's going to kind of keep that flywheel going. I mean, think, Colton, you bring up an excellent point.
That's something that's come up a couple of times. The definition of value, which seems like a pretty straightforward cut and dry thing, is not anymore. It depends on who the person is, who the brand is.
Yeah. And which really leads us to something that we've had a lot more conversation than we expected to. So at our Shop Talks Spring Show in Vegas, there's something called the New Market, which is a stage which is all about the attention economy. So we deliberately hadn't leaned into that topic in the programming here, anything as much, but yet the conversations around how the media landscape has changed have been inescapable. Deborah, do you want to start? I think you said this was probably your most surprising point of the show.
Absolutely. So at Core Site Research, we started in live streaming back in 2014 and 2015 in China. So very early on, we had KOLs, Key Opinion Leaders. So these were people who were trained to be live streamers. And at this point in China, it's about a $798 billion business. In the US, we're talking like $35 billion. So certainly we haven't seen the growth or really even the interest or the success we would have expected.
Speaker 1 (27:36.522)
And I would say from 50 % of the stages in the conversations we were part of, we heard live streaming and I'm like, this is unbelievable. And if you start to think about the impact of influencers and creators and new ways to reach customers, live streaming is really inexpensive. And so this idea that there are new ways to reach your customer, to tie it back into everything you're doing in different areas of social media, but everyone's looking for a new way to reach a customer.
and to be a bit louder and going back to in a live stream all of a sudden, you can change things in a live stream if it's not working. You can start to bundle product. can, hey, anyone who buys something in the next hour, you're going to get 50 % off or you'll get kind of two for the price of one. You can start to change things. And hey, an executive walks in, you happen to be in the office. Hey, come join the live stream. And so this idea that you don't know what you're going to get.
I mean, right now, US brands in China are live streaming eight to 12 hours a day. And so this is something where you sit down, you get your dinner, like you watch live streams. mean, it is part of the fabric of the culture, going back to that large number. And so I thought that was an, we only heard about connected TV. I mean, there was a lot about the impact of creators and how in some cases, as companies are building their programs for holiday, that's where they're starting. And I've never heard that before. And so,
I think there was so much in this area that was newly, like, I think even companies were like, you know, we were just talking about this last week in our managers meeting. A lot of this is new for holiday 25, and I'm sure we'll move into 26. So I think it's gonna be fascinating holiday from that perspective. And in terms of who wins right now, all bets are off.
And I mean, you've been really clear this kind of link has happened with the more that AI is featuring search results. So the more of your Google page returns Gemini, the more it's pulling from third party sources rather than your sponsored returns. And increasingly they are media and blogs and their influencers. So that spend is moving to paid, from paid to earned. that's been a huge trend. Holden, you're nodding. What have you heard on this topic?
Speaker 2 (29:52.518)
I mean, a similar conversation with a big B2B client. And you think B2B is like immune to this. And in reality, it's like, no, there's a bunch of Reddit comments that are now feeding Gemini and feeding ChatGPT. So when you go into the perplexity results, you're getting this feedback on how people feel about products. think what's interesting is during COVID, I don't know if you guys have to spend money on marketing, it got really expensive. Facebook rates went up 40%. TikTok's probably up 70 % over the last three years. Never came back down, by the way. Everybody wants your money if you're a brand.
And so while there's this bifurcation of the funnel and people have been talking about the death of the funnel for years, the funnel is doing fantastic. What's changing is that the embedded nature of commerce, and I feel like we've been seeing it for a long time, but I think now we're finally hitting the points where you're talking about tens and $20 billion of GMV moving into things like YouTube, where there's an unboxing video that your kids are watching and then there's a direct link to purchase. That changes the way that we think about marketing, which has always been about.
awareness and acquisition, we're really starting to get into conversion. Yeah. And I think which is beautifully illustrated. I borrowed one of Andrew Lipsman's charts here. And it just shows the growth in retail media and then the increasing fragmentation of it. And his continued view that retail media is basically going to be all media very, very soon.
I want to jump in here there really quickly because we heard from many brands that this is really like a really holding them back because they were very specific about how much they're paying different retailers to be on their site, to be in their stores. And they're like, is, and they're like, and then some of these retailers are trying to sell you our data back to us. And we know if we don't buy it if we don't pay the toll or the tax, then we will be kind of lower in
in priority. so I think this tension, right, we've seen, it's interesting going back to the mall, physical, right, it used to be landlord, tenant. I feel like that's changed to kind of retail or brand. And it's getting, I think this is going to kind of get to a point of, hence the private label focus. But I think we're going to get to a point of no return here. And it's, this is probably the most interesting and I would say friction filled.
Speaker 1 (32:09.72)
conversation right now.
I couldn't agree more and we're going to go deep in grocery shop on this because it's in CPG where it comes to a real, real pike. Okay, we've got my minutes. We're going to go more rapid fire now. Slide of the show. Joe, tell us about your slide of the show.
So this is a slide from a presentation by Janika Miszkowski, who's the chief executive officer at a company called Camp. Camp started out as a toy store. This is maybe not the ideal slide. Maybe I should have chosen her timeline slide. But she is talking about how Camp evolved from being a toy store when they started like 10 years ago or so to being a kind of place where people go to have their kids birthday party. It's about experiences. It's about this magic door that has something surprising behind it. And her point was like,
Some people may just say, well, that's easy for a toy store to do, but it's hard for us to do. We're a hardware store or whatever. But, like any retailer can think about ways to be more experiential, to lean into kind of pop-ups or kind of smaller formats or formats within their larger format. They kind of get to that like surprise, delight, joy, give somebody that reason that Holden was talking about to come into a store, as opposed to just it's a place to buy things. so, so the fact that like,
She thinks that almost any retailer can kind of experiment, should be playing with this sort of idea, regardless of product and brand, I thought was a big takeaway.
Speaker 2 (33:25.07)
So I'm going to take this one. This is an e-marketer slide. And it's an analysis of the different factors that they believe will be required to determine how quickly agentic AI commerce will spread. On the one side, it is how good is the technology, but on the other side, it shows also the level of trust that people will need to have to do it. I think that's really important.
In the last session, it was in here before this one, Andrew Lixman was on stage and he said, I don't buy agent e-commerce agent to agent is not going to happen. I almost wanted to stand up and shout amen because we focused so much on the technology and not about the customer adoption and the customers are, if you can't get your AI to Google a photo of you driving a car where you're sat in the passenger seat and the car is driving itself, you're not going to trust it to book your holiday for you. we're
Okay, let me be a little tiny bit though. I agree about the holiday thing, but like your weekly grocery shop, the stuff that you buy in week in and week out, and you just kind of care about the brand and the price. Like I think you'll turn an agent loose to say, compare Instacart with Kroger, with Walmart, with Target, with everybody else and get me whoever can get it to me cheapest, get it to me. I think the complexity of the product and the buy and like is going to influence how fast it's going to go.
I think we need to focus so much on the adoption and the shoppers to be able to get over that hurdle. Holden, another of your slides. As somebody who's inherently a contrarian, I love this slide. This is also from Andrew. It's Andrew's. Well, he's doing well. Andrew's killing it. Andrew's killing it at this conference. And the slide is about every single e-commerce hype cycle and how in many ways it was ultimately a failure. so voice commerce is still what? Less than 1 % of share.
Things like internet of things, connected devices, a smart fridge. I think I saw something from a big brand that may have presented here, so I'm not gonna say something bad about them, but there's a thousand dollar refrigerator that is now going to start showing you ads on the screen when before it wasn't. If you bought that thousand dollar refrigerator, do you know how you feel about it currently? Not fantastic, which is one of my challenges with retail media, and I will finish with my final joke of this session.
Speaker 2 (35:34.08)
If you have bought preparation H on like CVS.com, you know what you don't want to see? Hey, here's a three month subscription to Paramount Plus. Nobody wants that. And so being really intentional about the usage of some of these things I think is really important. But I do also, I'm on Joe's side. I disagree a little bit about agent to commerce because I think so much of commerce is low complexity. If you're retailers and you do trip mission analysis, right? And if you're a multi-brand retailer, I guarantee you one of your trip missions is like out of necessity.
It's restocking. I'm getting conditioner. I'm getting toilet paper. I'm getting whatever. That low-compact city stuff is the stuff that will get automated away. And I think that's a good thing because it allows you to innovate on experience and on storytelling around the more complex products. think for most of us who are in this field, we're going to do some of our most interesting work over the next 10 years of our career. Really? I thought we were going to solve that through dash buttons. Do you remember those? Yeah, anyhow. I'm going to move on. Tech discovery of the show. Deborah, what's been your most favorite tech discovery this week?
So it goes back to physical, which I think for a lot of us, it's, we wrote this whole series about the mall is not dead. And this whole idea around, the Gen Z is really returning to the mall as a destination and how you engage with the consumer, right, depending on, you know, demographics, psychographics. And so there's a technology called proximity and they're really all about client telling. So going back to
loyalty, right? What matters to each customer? And how can you embody that? This whole idea around we rolled out this core 3.0 framework for agentic AI and the E is about embodiment of intelligence, right? That exists. And the more that we can start to frame that in our engagement, either one to really one to one in the store is critical. And so Cathy was here earlier and it was really interesting to see the leaps and bounds that the technology has made.
but clienteleing.
Speaker 2 (37:31.022)
Joe.
Yeah. So, I, I love all of the companies that we selected to present on our technology focus sessions across our stages. But if I had a single one out, I think maybe the most interesting one is this, this solution provider called Alembic, A-L-E-M-B-I-C, that brings kind of a new technology spin on doing return on ad spend on, on just kind of measuring marketing effectiveness. And I think.
The industry has been wanting something better faster than media mixed modeling for ages and ages. Not saying Olympic is it, but I'm saying they're, telling a slightly different story than I've heard before. And, that alone was enough to make me excited.
Interesting Holden. My discovery of the show is very boring and old school, which is Shopify and commerce, big commerce. I know they're a sponsor of the show. I'm not sucking up to them. We implement a lot of these platforms. I don't have to. But when when big commerce a couple of years ago bought Fee Dynamics, I thought that was very forward looking and I thought the market did not give them enough credit for it because we know that share of wallet is starting to go into social and then agents and then search commerce, things like Google.
And a lot of the older e-commerce platforms, can't really manage all of your different touch points from one source. And so I think it's interesting to see commerce and Shopify in particular really invest in that notion of is your e-commerce platform meant to manage e-commerce or is your e-commerce platform meant to manage your website? And those are two different things if e-commerce is starting to happen everywhere. And so I think all of you, know, exploring that in your tech tech tech stack is really important to be future ready.
Speaker 1 (38:59.726)
I have to double click on that for 30 seconds. So there was a company here called Spangal and they were showing that work they'd done with Revolve in a very short period of time, a 14 % increase in conversion. mean, real data like that matters and it goes back to they're surfacing the right product to the consumer at the right time. And these are numbers we haven't heard historically.
Okay, 30 seconds each. Give me your quote of the show, Joe.
All right, Cory Conrad, who is with Caruso, which is an experiential physical shopping place, set of places in LA, very high end. He talked a lot on his session about share of heart, heart share. And I've never heard that before. hear share of mind, share of wallet, share of this, share of that. Heart share in the sense of like, are they catching a chunk of their customers emotions? And I think emotional retail is huge and really important. Look for a lot of that at Shoplux spring next year. But, but share of heart, it was an interesting metric to me.
like that Holden opened a store in Chicago. It was a couple of years ago, right? It wasn't that long. Yeah, 18 months. It said more than 50%. I don't know how they got the stat by the way, but okay. They said more than 50 % of their foot traffic had never interacted with the brand before. Like, way first, pretty big, right? They're billions and billions of dollars. Yeah. And I think that again, it just, have to rethink, especially companies who grew up as brick and mortar, you have to rethink the KPI and the value of stores.
Marketing is not just for acquisition, it is also for conversion. And stores are not just for conversion and revenue, they are also for acquisition. And that was an incredible statistic for me from a brand like that.
Speaker 1 (40:37.054)
building on Holden's this whole idea around KPIs. So Joe from Lowe's talked about LTR, likely to recommend as kind of an offshoot from customer lifetime value. And so this idea of how do you start to value kind of some of your media and in-store effectiveness, but likely to recommend, which I thought was LTR. Really interesting way to move forward.
that. I'm gonna I'm gonna share one. I think obviously we've got Gary V coming up. So I think we probably need to get everybody used maybe to the odd profanity. So I'm going to help warm up warm the crowd. And I got a great quote from day one, it comes back to the conversation we were having about social media and about working with influencers. And the founder of hydro very, very succinctly said, if you ain't being socially amplified, you ain't selling shit. So I think that's a great way to end. Thank you everybody for having joined us.
We are, I've got the future dates of our shows are on screen. 10 minutes is a meetup program. Then we've got a great final set of Kinos today. We've got Sam's Club, we've got SoulCycle, and then we've got Gary Vaynerchuk to finish the day off. So thank you everybody for joining us in Chicago. And please join me in thanking Deborah, Joe and Holden.
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