In this episode of Retaili$tic, Deborah Weinswig, CEO and Founder of Coresight Research, and Anna Beller, Director of Special Projects, discuss the evolving landscape of retail, focusing on the continued shift toward online shopping, the importance of experiential retail and the integration of AI in retail strategies. They explore how brands are innovating to connect with consumers, the role of digital asset management, and the impact of emerging brands in a competitive market. The conversation also touches on SEO in AI, sustainability, and the future of AI in retail, emphasizing the need for storytelling to enhance consumer engagement.
Takeaways:
Chapters
00:00 Introduction to Retaili$tic and Anna Beller
01:07 The Impact of Store Closures on Retail
02:54 Experiential Retail: Trends and Innovations
07:27 AI in Retail: Opportunities and Challenges
10:39 The Role of Digital Asset Management
15:51 The Changing Landscape of E-commerce
18:37 SEO in AI and the Future of Online Shopping
20:45 The Importance of Innovation in Retail
23:18 Sustainability and Consumer Engagement
26:37 Looking Ahead: Events and Future Trends
Deborah Weinswig (00:01.069)
Hello and welcome to another episode of Retailistic. I'm very excited to be joined today by Anna Beller from our advisory team. Hello, Anna.
Anna Beller (00:07.906)
Hi, so excited to be here with you, Deborah.
Deborah Weinswig (00:13.549)
We're excited to have you. So maybe since you're new to this audience or they're new to you, can you introduce yourself and then we'll jump right in.
Anna Beller (00:22.772)
Absolutely. It's so great to meet everybody on the podcast today. My name is Anna Beller. I'm a director of special projects here at Coresight Research. And I joined Coresight after spending about 10 years in experiential marketing. I joined Coresight as a director of special projects and I'm a founding member of the advisory team here and we work.
supporting both retailers and brands as well as technology companies with their strategy and future growth. I have a deep expertise and interest in the consumer and how brands and retailers can help connect with them and think about how to best tell their story, how to leverage technology to bond with their consumers as well as with their products and make things exciting for them.
I'm really excited to be here with you today.
Deborah Weinswig (01:16.761)
Well, I so are we. I think that, you know, some of the, as we look back on 2024, there certainly were many more store closings or announced store closings that will happen in the year ahead than anyone expected. And do you think that maybe the lack of an experience in some stores or a confusion in terms of what's happening online and offline for the same retailer, if that contributed to it, or what did you see as you were out and about and as you've done your research Anna?
Anna Beller (01:56.354)
Yeah, absolutely. The store closures, it's definitely a tough topic. I wouldn't necessarily say that I have the impetus for why more more are closing. I mean, we can see that more people are continuing to shop online, right? We're looking at holidays growth and most of it is coming from people shopping online. So this is a reality. I'm sure we've spoken about it at Coresight.
since unfortunately the pandemic hit in 2020, but it really accelerated where people are shopping. But ultimately there is a finite amount of spending power in this past couple of years with the inflationary environment has really impacted the way consumers are spending and how they're spending. what's interesting is retailers and brands are really focused on their online presence, how they're connecting with consumers on social media and thinking about new avenues on how to connect with them, right? Even Walmart came back again this year in a holiday and doing a full on production on Roku where consumers are able to purchase their products while watching a holiday special. So, Brands and retailers are getting creative on meeting people online. Offline, from my experience, has been a little lackluster. I'm fortunate to live in New York City. I did a little bit of holiday shopping in SoHo. Tried to avoid the weekend crowds, but on a Friday, it was still packed. Asked some of the retail salespeople: where are the cool experiences happening right now? And the list I got was, Louis Vuitton did a pet special, though I think that's closed already. I think Bloomingdale's is doing a few things, but only on the weekends. And Aveeno, of all brands, CPG company, is doing a coffee shop right here in East Soho. So that's really what we have going on.
Anna Beller (04:18.446)
I was really surprised. It's been a while since I worked in experiential, but I'm used to seeing huge productions of streets closing and entire exteriors of stores being built out with all sorts of screens and technologies and ways of getting the consumer to interact with products and think about how to customize them and create digital cars that they could then share on social media. I think one of the more interesting, which frankly seems a little elementary from an experiential standpoint is luxury shoe brand Alexandre Birman had a hot cocoa station outside their store.
Deborah Weinswig (05:04.281)
And I think that was really interesting. I'm not sure if you had seen some of the shared photos internally where Ralph Lauren had literally 20 to 24 people in line to get coffee.
Anna Beller (06:00.256)
Well, Ralph's is a really hot brand and Ralph Lauren has been really smart in the types of investments they've made and the kind of partnerships that they've fostered. And I mean that from an influencer standpoint, creator standpoint specifically. mean, TikTok's hot star from COVID, Tinxs, who now has a podcast on...
Radio Andy and has a huge following on social media. She's known as Gen Z's big sister is one of Ralph Lauren's biggest creator partner right now. She is only seen carrying a Ralph Lauren handbag these days. And she flew out to Chicago right before Christmas to do a holiday party where she invited all of her followers to the Ralph Lauren townhouse in Chicago where they had food and beverages, she took pictures and helped people style different clothings from Ralph Lauren. And Ralph has also been really innovative by capitalizing on their Polo Bear. So the Polo Bear is obviously now very much associated with their brand. I think it's fun and cute. And you can find sweaters on their website anywhere from $200, I think, in the thousands of dollars for one of their specific polo bears, whether he's drinking martini in a tuxedo or skiing down a mountain. People like to see that they can have their own version of a polo bear. And what they did was in some of their shops, I believe it was in Tokyo, in London, Chicago, and New York.
They created an interactive AI window outside of their stores where you could wave to the polo bear and he would wave back. You could make heart shapes to him and he would wave back. I didn't even see it in the store myself because I wasn't uptown in New York, but I saw it all over my social media. People loved it. People loved it. They shared it.
Anna Beller (08:19.554)
That I think is definitely a winner from the experiences that I've seen. One, capitalizing on the brand. Two, leveraging technology in a fun, innovative way to connect with your consumer. And obviously it was partially powered with AI. So kind of a trifecta.
Deborah Weinswig (08:40.66)
Is it, it, I mean, that's, that's, think, right. As we think about the, year ahead, this idea of kind of AI, everything, you know, on the advisory team, I know you get a lot of questions and you're really helping drive success. I will say from friends of mine who lead companies, I get to hear everything they've tried. And for the most part, everything that didn't work which is why I still think we're seeing at the corporate level a lot of conservatism. I'm not sure what you've experienced.
Anna Beller (09:16.736)
Yeah, I think from our clients everybody is interested in the AI tools that are going to help them work smarter, cut costs, and be more on top of things. So we've had queries from everything from how can our legal teams be smarter in terms of catching changes in contract renewals to making sure that they have a good heads up of when a lease is going to expire and what some of the new terms that were negotiated have been to for their creative teams. You know, how do I come up with fresh ideas to mood board? How do I cut down the time to production? mean, Nike in the beginning of the year had done a whole collaboration with different Olympic athletes and allowed them to input personal things from their background, their family, their interests, what's important to them in their sport to help develop individual sneakers. And they started with mood boarding, which quickly moved out into 3D prototyping. You could say, well, OK, 3D prototypes, not necessarily AI, but they used AI to think about what is the manner in which we can get the best design of the product with using the least amount of materials, right? There's always that sustainability aspect that goes into it as well. And ultimately they did a whole display of really cool forward looking designs that really represented the athlete who was involved with them while really showcasing how AI is really such a core part of Nike's development today.
Deborah Weinswig (11:20.78)
It's interesting to see where companies are looking to invest in AI. And one of the things that we've seen is a big focus on digital asset management or DAMS. And this idea that as companies are creating copy or thinking about different ad campaigns, they can go back into the archives.
They also know kind of what photos have been approved for posting on social media, et cetera. And there's a few companies we're working with like Bynder and KittyKat, where you're not only seeing this ability to access, mean, think about it, Anna, of course, right? We've got tons and tons of video content going backwards, just talking about with like even the pictures of, you know, Ralph's, et cetera. you know, right, let's say we're writing a research report and we want to show kind of like how experiences have changed over time. I mean, right now to do that is quite manual, but with these dams, it's very easy to access. And also with like KittyKat, you can create custom images and they're all brand appropriate for, I think it's really like under $50 and for each image you would use in like a campaign, that savings and that impact on kind of not only efficiency, but outcomes
These are things that get me really excited and I feel there's very little risk, but I'd love to hear what you think.
Anna Beller (12:51.086)
Yeah, you know what, what I'm kind of wondering about going back to my life before Coresight almost six years ago is how's that really going to impact the agency world? You're already seeing all sorts of acquisitions and unfortunately some layoffs in the agency world. But if all of these AI tools can start to be implemented in-house, how much savings different retailers and brands can think about by being able to manage it on their own. And not only from the big guys who have the money to pay for an agency, but how does that also impact some smaller individuals who are looking at launching their own brands? We're seeing a lot of these young brands in beauty, especially in resale. Earlier we were chatting.
Earlier today we were chatting about luxury resale and live streaming. And I have some experience in the luxury jewelry space with resale and estate and how much more professional an individual might be able to appear by leveraging some of these tools like Kitty Kat.
Deborah Weinswig (14:14.188)
That's exactly it. me, the big change with AI is that for let's say 20 or $30 a month, that's just if you want to keep all of your information safe, you can use it without paying a monthly fee. But this kind of democratization of best in class kind of tools and solutions for your business and how easy it is. We were talking once again earlier, Anna, about how we're seeing new companies pop up and in six months. Actually, this was something that was said on stage at grocery shop in the kind of shark reef pitch as we were having conversations with the judges. From the VC side, what they were saying is like in the past, right, you would have a lot of companies with, you know, kind of up and to the right with growth. And now it's not only is the hockey stick steeper,
But these companies, right, once they work, they like really work. And so we are seeing some real change in terms of investing, thinking about investing, et cetera. I don't know how easy it is. And I don't know if SEO is more important or not than it used to be, but we're certainly seeing, you know, the ability to get recognized and realized is probably the most important thing.
Anna Beller (15:42.338)
Definitely, mean, and SEO is a really interesting topic because you're seeing today that a lot of Gen Z and younger Gen Alpha, they're going directly to their GPTs to search. Google is starting to lose some of its capital in the search market. And so that's one side. And then the other side is the whole social media part of it.
How is the interest that you take in certain videos impacting your algorithm? So at what point is someone maybe not seeing what any of the top retailers on that top right you were talking about in their feeds at all, and they're only looking at smaller mom and pops or not even shops, people just working right out of their living room, and that being the kind of content that they're interested in and being served.
Deborah Weinswig (16:38.124)
Yeah. Well, it it goes back to the, you know, this idea, I think of unified commerce and. You know, you mentioned how Gen Z is, is shopping and I stores, I love to look at the numbers from Abercrombie because I think that that summarizes it so incredibly well. And I believe overall their online penetration is just under 50%.
But if you look at, if we assume that by brand, like Abercrombie versus Hollister is indicative of age, 70 % of Hollister sales are in store, consummated in store versus 40 % for Abercrombie. And that's at the most recent quarter. So you start to think about how important physical is for Gen Z. And to me, that says a lot about their focus on sustainability, Because product bought in store is half as likely to be returned as being bought online for many reasons, right? I mean, even if you're not trying something on, right? It's the fabrication, it's the color, right? Which can be challenging. And I do feel, you know, with a lot of the store closures announced, now if they actually happen, right? I mean, can't believe it was just like a week ago, Friday, right? The whole, I mean, drama around Party City and Big Lots and the idea of what is, you know, you think about like a Big Lots box, right? Or Party City. What a perfect place to do live streaming, Anna. I mean, and this idea of, okay, you're throwing a kid's birthday party for a five-year-old, right? These are some great, I mean, you could literally have employees do live streaming.
It would create an experience for the customers. It would drive sales. You would then elevate that sales associate. I mean, I just think that the opportunities are maybe, I mean, hey, maybe it's like what we face at Coresight. There's so many different things you can do. Where do you start and how do you prioritize?
Anna Beller (18:48.898)
Yeah. You know what you actually made me think though, a lot of why they're in their position today is proliferation of Amazon, right? And Temu even. But if we're thinking about, or talking about the little guys a little bit too, right? And people, individuals being able to start to become competitors as well, you know, where was the opportunity for Etsy?
Right? Where is Etsy having their live streaming and allowing their individual creators and people who make special party favors to show that off as well.
Deborah Weinswig (19:31.388)
Yeah, well, and the, you know, the challenge I think one faces if you look at is just the, shipping cost when you're shot, you know, when you're shopping. And I think that, that to me will be a, a driver. mean, going back to your, your comments around Temu and Amazon and Whatnot, the, well, and I mean,
If you think about it, like when you start to do the research, to me what's so fascinating is you can find the exact same product and I'd say over 50 % of the cases on Temu because it's made in the exact same factory. So I'm talking exact product on Amazon, but it's like a quarter of the price because you're getting it basically direct from factory as opposed to, you know, a half a dozen people touching it along the way. And that to me is where there's so much misinformation on the product, how you're getting it. But consumers are sharp. I, you know, even for Temu, I believe that their total sales for 24 will be at least 50 % higher than they had originally expected, which was about 30 billion. Because at the halfway market, right July one, they were already at 20 billion. So they were already far ahead of the, and we hadn't even gotten the holiday yet. I mean, think about like, think about what that says to you.
Anna Beller (20:58.188)
It's incredible. I think the search thing that you were saying is another application of how Gen Z is shopping differently online because they can take that picture, screenshot it from Amazon, go to Google image and search it. Or they could see someone down the street while they're shopping and take a picture of their sweatshirt. They don't need to stop and ask them where they got it.
They can find it online and not only can they find it online, they can then have all sorts of plugins. There's something called HautePursuit. Of course you have Honey that can help them compare the prices and buy it from the retailer that has the best price for them.
Deborah Weinswig (21:41.952)
Well, and that goes into, right, to just bring a full cycle on our conversation, that goes back to also where SEO also comes into play.
Anna Beller (21:51.566)
Absolutely, The SEO and the AI.
Deborah Weinswig (21:56.46)
I'm telling you, I think that it's, if I were to look ahead to 25, which you and I have spent a lot of time on this recently, the impact of a lot of these new solutions is going to require big companies to be much more agile. And what we've seen is, does somebody in the organization, own innovation, right? when we were at Li and Fung, right? That was, everyone was trying to own innovation, but, but ultimately I think you need to train your teams and give them permission, permission to fail and, and to provide them with the tools and, and solutions. mean, one of the things I had loved when we were at Li and Fung was right. We would have, you know, basic contests to see who could come up with some of the most innovative opportunities for our clients. And that really had such a huge impact on, I really think empowering people to think outside the box and act outside the box as well, which I think was a huge opportunity for everyone. And I mean, every single person in the company. But as we think about our clients and their opportunities in the year ahead, this idea of the chief AI officers come up time and time again, and there's a lot of confusion around it, which I think that we can hopefully put into context where the chief AI officer, their role in many organizations where we found it successful is that different people throughout the company will come to them and find out what tools are already being used successfully. And they may have something they want to utilize, which the chief AI officer will sign off on in terms of paying for it, the contract, et cetera. But also, this idea that you can learn from others throughout the company and this one person can help direct you to those individuals, all the while being encouraged and empowered to use AI in your business. And we found that model to be the most successful. But once again, in retail, we're still seeing very few chief AI officers, but I do think this will be a growing trend in 25 and beyond. What are your thoughts?
Anna Beller (24:12.75)
I was going to share that from some of our clients, what we have seen to be the most successful is having one person who, or maybe even a small team of people who are these AI experts, or head of innovations. But they do empower each team to go out and investigate and maybe trial with different companies to see what's best for them and to come back and share their learnings. Because ultimately, you know,
One organization isn't going to have $100,000 scopes of works or even multimillion dollar scopes of works with two providers that do very similar things because there needs to be synergies internally. But if different teams within the retailers and brands can start to investigate and test and then come back with their learnings see how it can be beneficial for the wider organization without having to be duplicative in their spending, they're gonna be much stronger for it. They'll have tested more than one tool out. They'll be able to see how it works for multiple teams and not be so siloed. And time and time again, that seems to be the biggest struggle in some of our larger clients. They're such a big company, people are siloed and so focused on the individual project they're working on that sometimes it's hard for them to see the forest through the trees. not to pat ourselves on the back, but one thing that we've been really great at at CoreSight and at the CoreSight advisory team is working with clients on an executive level and doing these executive briefings where we talk about various topics that
are important across their organizations and highlight different tools and ways that these technologies impact across various areas of the organization so that our clients can think about making smarter decisions in their investments while having a greater impact across the entire org.
Deborah Weinswig (26:28.8)
Yeah, it's interesting. I'm just thinking back to some of our recent conversations with companies like Invent.ai with Board, with Digital Wave on the opportunity in your head and also with obviously with tariffs looming on the planning process, right? So starting way early in your journey, right? Going back to raw materials. It says so much, think, is like, once we have the product, right, then we're trying to figure out, right, how do we go to market and our experiential versus, right, online and physical. And if we can go back to the very beginning, I mean, once again, I'm like putting this in context of how I'm thinking about things at Coresight as well. Right. My whole thought now is like, before we write a report, right, even start, let's think about the imagery and the title, right? So that it's a lot easier to get to the end if we start earlier, if you will, with the beginning. And I wonder if, if as we, you know, and we're starting to see some really interesting, right? We just had this, you know, really interesting conversation with a retailer that was using board on this, this whole idea around predictive analytics, which, you know, I had worked at this amazing Israeli tech startup that was acquired by Zebra. And, and we had looked at predictive analytics in terms of, right, this, and this goes back to old AI versus new AI, but we are seeing a lot of companies very comfortable with predictive analytics versus, you know, this, this kind of move into more, you know, artificial general intelligence. And I think that the, the big move that we'll see in one queue is the idea around planning as its own kind of area of competency with also a look towards sustainability, which I know is very near and dear to your heart, Anna, because if we can do a much better job of understanding what the customer ultimately wants, and then we can, and not only through like the, how they want to experience it, but what they want to buy, then we can start to think about a lot of those assets, I think much earlier. And I mean, hey, we see the best success, right? When there's a lot more imagery, embedded videos and low returns, because to me, right, the one thing I will say, I'm probably the most surprised with as we leave 24. And once again, I know it's near and dear to your heart, is just the rate of returns and how that continues to truly defy gravity. it's one of the topics, we've worked very closely with Navjit and Newmine on trying to help retailers rethink returns and what they can do to mitigate those. so as we close out 24, that's one thing I really want to...
Deborah Weinswig (29:19.872)
see what we can do from a technology perspective. I think it can have a significant impact. What about you, Anna? As we close out this year, last question for you, what's kind of near and dear to your heart, and how do you think it could impact retail and retailers?
Anna Beller (29:33.738)
Yeah, well, you know, kind of piggybacking off of what you just said and where I opened up and introduced myself as thinking about how the consumer can really have that great relationship with the brand. And you're talking about, how are we going to market the product that we haven't even created yet? How are we going to present it? And if you think about how you're going to what the retailer and brand is looking to provide to the consumer from the beginning. And they can help tell that story once it's already in the marketplace. So, I think of certain brands that only produce their denim in Los Angeles, for example. And they like to talk about, well, we know Western style is gonna be really popular. We took inspiration from you because you guys were liking it last year, say Coachella.
And this is the cutter in Los Angeles who helped choose this exact fabric. And this is the designer that thought about all the studs and accoutrement that go on to finishing the jean. making sure that the whole back end of the story also gets communicated in the front end, I think will allow the consumer to have a stronger emotional attachment, not only to the brand, but to the product which should hopefully also eliminate some of the return. They're going to love it before they even get it because they see everything that went into it. They see how much themselves a consumer was surrounded in the development of the product that they'll feel like it's a part of themselves. So I think part of the storytelling and even the traceability, right, who's involved.
Deborah Weinswig (31:31.516)
I think you said it so well there. in terms of what's on the horizon as we close out the year, CoreSight will be at CES. We're leading the high tech retailing summit. We're very honored to do that in partnership with Intel. We'll then be at NRF where we'll kick off things with the VIP awards on Friday night and close it out on Tuesday with the Coresight cocktail party.
We then have a little bit of a break and we're heading off to both RILA and FMI Midwinter. So it's going to be a very busy January. We want to wish all of you true magic in the year ahead and happy holidays. Hope you have a wonderful year end. Anna, thank you so much for joining us. It was such a pleasure.
Anna Beller (32:20.686)
Thank you so much for having me. This was great. I hope to do more of it with you in 2025 and a very happy new year. And I'm excited to see what 2025 has in store for Coresight and for all of our clients and extended community. It should be a good one.
Deborah Weinswig (32:37.772)
Thanks again. Take care, everyone.