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Sara Lebow (00:00):

This episode is made possible by Quad. In marketing, everything must work seamlessly, or efficiency, speed and ROI all suffer. That's why Quad is obsessed with making sure your marketing machine runs smoothly, with less friction and smarter integration. Better marketing is built on Quad. See how better gets done at www.quad.com/buildbetter.

(00:25):

Hi, this is Sara. Before we get started, I want to let our listeners know that this will be my last podcast episode as host. After four and a half years filled with so much learning at eMarketer, I moving on to my next professional journey. Thank you to our podcast team, our analysts, and of course our listeners for making this time so meaningful. I may be moving on, but Reimagining Retail is not going anywhere, and you can tune in right here to a slate of guest hosts over the next few weeks. I know I'll be listening. Okay, onto the show.

(01:00):

Hello, listeners, today is Wednesday, July 16th. Welcome to Behind the Numbers: Reimagining Retail, an eMarketer podcast made possible by Quad. This is the show where we talk about how retail collides with every part of our lives. I'm your host, Sara Lebow. Today's episode topic is how our 2025 predictions are doing, plus a few more.

(01:27):

Let's meet today's guests. Joining me for today's episode we have in studio with me, Suzy Davidkhanian. Hi, Suzy.

Suzy Davidkhanian (01:34):

Hello.

Sara Lebow (01:35):

And also with us joining us from across the pond, as one might say, it's Carina Perkins. Hey, Carina.

Carina Perkins (01:42):

Hi, Sara.

Sara Lebow (01:44):

Okay. In November of last year, our analysts put out a report with a number of retail trends and predictions for 2025. Some of these trends we've seen definitely play out, and some of them are still sort of in progress. We're halfway through the year, so we're going to check in on each of these trends, see where they're at, have they come to fruition, what's happening with them. And then at the end of the episode, we'll each present a much spicier prediction of our own, looking out for the rest of the year and the year ahead.

(02:13):

So let's get started with the first trend we had in that report, which was GenAI will unlock the potential of predictive AI to supercharge business growth. Let's start off with what we meant by that. We meant that marketplaces are going to use AI for predictions.

Carina Perkins (02:31):

Not quite.

Sara Lebow (02:33):

What did we mean by that?

Carina Perkins (02:35):

So predictive AI is what retailers and other companies have been using for years to do forecasting and predict consumer behavior. But in order to get those predictions you need to have, it's not the easiest thing to interrogate so you need kind of that technological expertise in your company. And it can take a bit of time, it can take a bit of resource to get the best out of those predictive insights. So, what generative AI can do is it can act as a kind of user interface, which means that non-technical staff members can interrogate the predictive analytics and get really fast, actionable insights.

Suzy Davidkhanian (03:16):

And it would use the social context, right? So it can understand, it does social listening for you. It can figure out, what are the people trends? It's the human language element. So it all came together because one of our predictions was that retailers were going to continue and/or start to use the combination of GenAI and predictive AI for their inventory planning, which some companies have. I think Mango is doing that. There are some companies doing it. But Carina, what's the outcome of this trend, in terms of, were we right?

Carina Perkins (03:48):

Well, so it's kind of a tricky one. I think we were right. I'm fairly certain that a lot of companies are doing this under the hood. The problem is that it's not really the kind of things that they tend to talk about, send press releases about. They like to talk about their consumer facing GenAI, but we do know that AI forward enterprises, so that companies that are really integrating AI into every element of their business are using this combination of technologies. So, rather than just focusing on GenAI in isolation, they're using it alongside other forms of AI, like predictive AI.

(04:19):

What we perhaps didn't anticipate, although we did talk about it in our tech trends to watch, is AI agents and how big the buzz around them would be this year. And I think certainly from a retail perspective, everyone's really, really excited over their potential to kind of change the shopping journey and automate some of the shopping journey. But actually that is, if anything, going to accelerate the trend that we were already talking about because AI agents, they use agentic AI for that kind of autonomy to automate the process. And agentic AI means you can link lots of different agents together and complete a task without human intervention, but they also use predictive AI and they use generative AI.

(05:01):

So you might, for instance, in a marketing model, have predictive AI, which predicts that a customer is going to sort of drop off, and then you would have generative AI, which will generate the marketing copy needed to try and-

Sara Lebow (05:17):

Keep the customer.

Carina Perkins (05:17):

... keep them on board. So it's using all of the AI, and I think really what we're seeing is that that combination of the different types of AI taking a really comprehensive approach is what's going to drive growth.

Suzy Davidkhanian (05:30):

I didn't want to steal Carina's thunder in that, I do think we got it right. It's super important.

Carina Perkins (05:35):

Yeah, we did, yeah.

Suzy Davidkhanian (05:36):

But I do think the buzzier trend is the agentic AI and maybe it's like when we were looking at the trends, it was Q3 last year and GenAI was what everyone was talking about. And if you don't have GenAI, then you don't have a agentic. But the new shiny penny seems to be a agentic right now.

Sara Lebow (05:51):

Yeah.

Carina Perkins (05:52):

Oh, 100%. And it's very new, which is why I guess we didn't see it so much.

Sara Lebow (05:55):

Yeah, it's the shiny penny. Yeah.

Carina Perkins (05:55):

Yeah.

Sara Lebow (05:56):

Yeah, I would call this correct and in progress. I would say if you're a retailer listening to this episode, hi. The takeaway would be, your competitors are doing this even if they may not be talking about it. So, make sure you're doing it as well.

Carina Perkins (06:12):

I've got one more thing to add to that discussion as well. So I think also the trend was that it was going to supercharge growth. And again, that's been a little bit of a tricky thing to measure because there are a lot of challenges around measuring ROI and what growth is coming from AI and so on.

(06:26):

But there was a really interesting study from Rackspace technology, which was conducted by Coleman Parks Research in April 2025, and it identified these AI leaders kind of companies that were really integrating AI throughout their organization and using advanced AI practices, and that would include things like combining generative and predictive AI. And it said that almost two thirds of these AI leaders are reporting substantial benefits from AI. So, I think we are really seeing the technology coming to fruition for companies that are investing in it wisely.

Sara Lebow (07:00):

Okay, Suzy, Carina is showing us up in data, so we need-

Suzy Davidkhanian (07:01):

I'm on it.

Sara Lebow (07:03):

We need to keep up. Let's move on to trend two, which was China's e-commerce disruptors will be disrupted. Okay, I'm going to take this one first.

Suzy Davidkhanian (07:14):

Okay, go.

Sara Lebow (07:15):

Because obviously this has happened. However, when our analysts put this together, we didn't know who the president would be, we didn't know what US policies would be around tariffs. So the way we saw this playing out was TikTok shop is here to stay, I think that's fair to say. Shein will dive deeper into supply chain as a service, and Temu will challenge the everything store. And obviously, we've seen Temu and Shein take some hits this year.

Suzy Davidkhanian (07:41):

So when we wrote this trend, it was more, we were leaning into, yes, everybody knew that there was some unknowns for TikTok, but it was much more about the loophole. Right? So we were thinking these players became big and disrupted US players and European players and really global players, because of the tax loophole, which is more of like an import tax loophole. Right? So and now, the disruption is much broader in that there's actually tariffs on the goods themselves being produced at any level, and the taxes or tariffs are astronomically higher than anyone could have ever thought about. So it's not that we didn't get it right or wrong, there's a lot of disruption. It's just that the disruption was way bigger than we had anticipated and it's we can't even see what's happening with these players because they're all trying to just figure out their inventory and their supply and how to get stuff there. So, what we thought was going to be a year of continued growth in a different way has turned out to be something quite different.

Carina Perkins (08:44):

Yeah, and I think interestingly, it's also going to disrupt other markets. So Shein and Temu have turned their attention to the UK and France, they've both ramped up advertising spend in those countries. But in the UK, regulators are also considering scrapping the rule that allows small parcels to enter the UK duty-free. So they're not looking at the same kind of astronomical tariffs that the US is, but they are trying to close that loophole.

(09:08):

I think it's also worth mentioning, aside from tariffs, the challenge from Amazon Haul, which launched in beta in June 2025, and it's got loads of products for $20 or less with most under $10, and of delivery times of one to two weeks. So I think Amazon's really trying to create a business model there that goes after those retailers.

Sara Lebow (09:30):

How do you see Amazon Haul, I guess, being affected by these same tariffs, though? The products aren't coming from the US.

Suzy Davidkhanian (09:36):

Well, that's what I was going to say. I think 100% in foreign markets, the additional situation in the US is that the country of origin of the product. And so, Amazon Haul too, by default has products coming from not made in the US. And so in the US market, that might be a challenge for them, whereas in the rest of the world, I think they can certainly take advantage of that.

Carina Perkins (09:58):

Yeah, I mean, I think the Amazon, it might be an issue for them in markets like Germany where Amazon has such a huge share of retail sales already.

Sara Lebow (10:07):

Okay, so for China's e-commerce disruptors will be disrupted, I would say, 100% correct prediction. Not exactly playing out how we totally saw it, but definitely disruption happening there.

(10:20):

Our next trend, mounting pressures will squeeze the long tail of retail media networks. Where are we at with this one?

Suzy Davidkhanian (10:28):

So I think, again, we didn't know everything that was going to happen. On the surface, this is truly happening in that there are lots of different pressures that are squeezing retail media networks. It's coming from many different areas, right? Brands and advertisers therefore are cash strapped and worried about margins, so they're being more judicious. There's definitely more competition in this commerce media space than there has ever been, so brands and advertisers are thinking about other places. There have not been new ones popping up in the retail world. There have definitely been some tie-ups between ad tech vendors trying to work with retailers. And I would say that the idea that advertisers prefer to just go to fewer places has panned out, as we see with Amazon has the lion's share, Walmart a giant gap to second place.

Sara Lebow (11:23):

Or cub's share.

Suzy Davidkhanian (11:23):

And then its Target, yeah.

Sara Lebow (11:24):

Yeah. You're right, haven't seen new retailers enter this space. We have seen, I'm not sure if it's within this calendar year, honestly, it probably isn't, but we have seen new non-retail players enter this space from financial media networks, to travel media networks, to even gaming media networks. Mohegan Sun has a media network, so.

Suzy Davidkhanian (11:43):

Much of that is in this calendar year, so.

Sara Lebow (11:46):

Yeah, so the long tail is, I mean, technically not for retail media, but for commerce media getting longer, which I think is going to make it even squeezier, which is a word we're inventing.

Carina Perkins (11:57):

Yeah, and I think we've got some similar challenges in the UK and Europe. It's a bit of a different landscape here, we're a little bit behind the US in terms of retail media's development. And we've still seen double digit growth in retail media ad spend in the UK, France, and Germany. But in the UK particularly, that's come down from 30.8% growth in 2023, so there has been a bit of a slowdown. In Germany, 80% of retail media spend is with Amazon, so it's got huge dominance there. In the UK and France, there's a little bit more competition, they're more digitally developed, especially in the UK the grocers, Tesco, Sainsbury's, Asda, are quite strong players in the space. I think there's more than 100 local retail media networks operating in Europe, so it's a hugely fragmented landscape. But one thing that's hindering investment is the fact that there's not many that operate cross border, and so that limits the size of the market that each one can play to. And again, that gives Amazon a huge advantage.

Sara Lebow (12:51):

Do you think you'll see partnerships between those retailers to cross borders, or do you think that will face regulatory challenges?

Carina Perkins (12:59):

So what we've seen already is retail media networks forming, which are a few retailers kind of banding together and forming a retail media network. So we're already seeing that, and that's happening cross border.

Sara Lebow (13:10):

We're not seeing that in the US yet, but I think we will.

Suzy Davidkhanian (13:13):

I think because it's just one country, it might be a little bit of a different thing, but and in Europe, some of the brands that do sell across countries and do cross border are vertically integrated like Azara. So, that's not, we saw from Gap that didn't work, that when you're a one brand show, unless you start building a marketplace, you're never going to be a retail media in the way that it's designed to be.

Carina Perkins (13:35):

Yeah, I mean, I think the issue here is that a lot of the strong retail media networks in the grocery space, which is why there's not so much cross border. But yeah, we are seeing a lot of retail media networks launching with a lot of retailers partnering together to get that scale.

Sara Lebow (13:49):

So for mounting pressure, we'll squeeze the long tail of retail media networks? Sure, yeah.

Suzy Davidkhanian (13:54):

A-plus.

Sara Lebow (13:55):

Yeah.

Suzy Davidkhanian (13:55):

I love giving myself an A-plus. It's not my trend, but I still love pretending.

Sara Lebow (14:00):

Next trend. Retailers will take a greater stake in media and entertainment content. We expected to see more brands launching production companies and retailers using their own owned and operated channels. We saw some of this at the end of last year. I remember there was a Hulu, Sephora partnership. I can't think of any times I've seen it this year beyond Amazon, and I guess Walmart plus has partnered with Paramount, right? But-

Suzy Davidkhanian (14:25):

Also from last year, but so I would say if you take this trend and the next one, which was about the paid membership perks and that sort of, how do you distinguish yourself from the other? And then you lump all of this into the loyalty sphere and how are retailers and brands distinguishing themselves and doing activations and different sort of engagements with potential consumers and customers that are beyond, let me give you a coupon so that you come buy from me. And so it's becoming a completely different sort of way of thinking about loyalty and brand building.

(15:02):

And I think given the economic uncertainty, the tariffs, everything that's happening, to your point, there hasn't been a lot happening in either of these spheres because I think it's a bit of a longer game and people are worried about the short term right now and cost is the biggest concern. Having inventory on your shelves, I don't know if you guys saw a lot of the pictures over July 4th on LinkedIn where people were showing retailer, but it was always the same retailer. Retailer that shall not be named, their shelves were empty. And so I think retailers have bigger problems to fill than this. That said, Mattel is working on Barbie, was a success already a couple of years ago, which is kind of crazy. They're working on Hot Wheels, which is like a Mattel branded production. Lego has done some work, there's still something around partnerships. And Martha Stewart and Maman, which is a coffee shop here in New York, have a thing going. So there's definitely stuff happening, but you're right, it's not quite as big of a splash as we had anticipated it to be.

Sara Lebow (16:03):

So Suzy, if you were to take this trend and maybe combine it with our final trend, which was partner perks will be the new pillars of paid retail memberships, how would you classify the kind of accurate, in progress state of both of these trends combined?

Suzy Davidkhanian (16:22):

I think they're in progress, and it's not a quick fix sort of, right? If you think about a Walmart or a Target that's trying to find new partners, it takes time for everybody to understand, who's their overlap? Why are they even partnering together? What is the benefit to each of them? Is this the marketing play? Is it a product play? Is it a overall sort of, let me grow my business with lower cost of acquisitions? So I think those types of things take longer to do. It is not, I think we'll see them more, but right now there's so much turmoil and uncertainty in what's happening in terms of the more basic parts of retail, that I think it's a tough one.

Carina Perkins (17:04):

I think as well, if you look to the UK where we've had really quite a difficult economic environment for a few years now, what we've seen with loyalty especially here, is actually it's kind of gone back to the basics. So retailers have actually started introducing lower prices for loyalty members. So it's not even just to kind of collect your coupons or collect your points, it's, if you're a loyalty member, then you get a straight off lower price. So it'll be interesting to see whether that sort of thing happens in the US as well.

Sara Lebow (17:31):

So based on our five trends, five statements we've gone through, what percentage would you say have come to fruition so far?

Suzy Davidkhanian (17:40):

Fruition, or have the potential to be?

Sara Lebow (17:43):

Fruition so far.

Suzy Davidkhanian (17:45):

I'm going to go with, I mean-

Sara Lebow (17:47):

Three quarters.

Suzy Davidkhanian (17:47):

... 50%.

Sara Lebow (17:48):

Oh, okay.

Carina Perkins (17:49):

No, I would say three quarters.

Sara Lebow (17:50):

All right, solid, and we're less than three quarters of the way through the year, so that's solid progress.

(17:57):

Okay, we're moving into the second half of this episode, which is where we'll share our own predictions. These are our hot takes, spicy predictions, things that probably won't happen, who can say, although everything we say is stuff that really might happen, but they are sort of hot takes. We each came up with one. I'm going to go first.

(18:17):

My prediction is, Walmart will launch a new online fashion marketplace to take advantage of Temu and Shein's absence. Obviously, absence is sort of a loaded word here. Obviously Shein and Temu are still around, but they've taken such a big hit with tariffs that I see Walmart, which has already made moves to get into higher end fashion, trying to fill this fast fashion space that Temu and Shein will leave open. Now, the challenge here is that Walmart is still producing these items outside of the US, so like we mentioned before, there will still be tariff challenges here. I just think Walmart might have an easier go at it than companies that are associated with China.

Suzy Davidkhanian (19:03):

I think it's really interesting, I think it goes back to the Amazon Haul. So it's a little bit like, is it going to try and do an Amazon Haul scenario, lean in on its fashion, sort of it's trying to push into fashion, but at that lower price point? It's interesting, I think it's a tough one though, only because they already have so much private label that's not super expensive, that's not necessarily seen as fashionable. So I think to get there, they'll have to turn that sort of more basic stuff into-

Sara Lebow (19:31):

Well, this is why I think its own marketplace makes sense. It's almost like it's a rebrand without having to come out with a bunch of new private labels. Sort of what Walmart did with Better Goods, which is a private label unto itself, trying to associate these brands with fashion, with fashion marketplace in its own siloed area.

Carina Perkins (19:52):

I wonder as well, whether we might see, we know that some countries are targeted with particularly high tariffs, other countries not facing as high tariffs. Perhaps some of them have the potential to produce fashion cheaper. So, I wonder whether we might see retailers reaching out to their manufacturing bases to other countries that aren't so exposed to the tariffs.

Suzy Davidkhanian (20:12):

And Walmart is so gigantic that it's certainly has that advantage of scale.

Sara Lebow (20:17):

So this prediction, are you guys buying into it?

Carina Perkins (20:19):

I love this one, yeah.

Suzy Davidkhanian (20:21):

I'm only half in.

Sara Lebow (20:22):

Great. One and a half, I'll take it. Suzy, what is your prediction?

Suzy Davidkhanian (20:27):

So given that we just talked about tariffs, everybody is very value conscious. Everybody's looking for low cost, everybody has tight budgets, and tariffs are making things more expensive in every way, shape, or form. Combined with, there's this whole reshoring movement of Made in America, which helps retailers with their margin as well because it reduces shipping costs. And sorry, I'm leading up to it so that you all give me a one. And because retailers need more control over their inventory and better understanding of where things are and how quickly to get them, and because of our first trend, look at how I'm building into this. And because of our first trend about GenAI and predictive AI.

Sara Lebow (20:27):

Sure.

Suzy Davidkhanian (21:15):

... and trying to be more in real time with trends, one more and, and because it's hard to get cheap plastic goods now with the tariffs in place, much of that stuff is produced in China or Asia in general. One more and, and 3D printing was a really big deal a while ago, and now it is still a big deal in some industries like prosthetics. There's a long list, I'm not going to go through it since I've had so many ands.

Sara Lebow (21:43):

Bring it home.

Suzy Davidkhanian (21:44):

I think, now this is the part that it's hard to know. I originally thought that Walmart will launch a line of cheap goods made in-house with 3D printers in Berlin. Right now there's a company called Solebox that's collaborating with Zellerfeld, and they're doing 3D printing shoes, running shoes in store. So it's not far-fetched to think that retailers are going to bring this back. There's so many reasons why they're going to want to bring this back to do it.

Sara Lebow (22:15):

So, is your prediction that Walmart will launch a-

Suzy Davidkhanian (22:17):

A line of cheap goods made in-house with 3D printers.

Carina Perkins (22:21):

My quick question is, are these going to be plastic goods?

Suzy Davidkhanian (22:24):

Correct, yes.

Carina Perkins (22:25):

Okay. So my only question here would be, Walmart has made some environmental pledges around emissions targets.

Suzy Davidkhanian (22:34):

This is such a good question.

Carina Perkins (22:35):

It's already, I believe, said that it's likely to miss its 2025 and 2030 targets. So, whereas perhaps Temu hasn't made quite the same pledges, I'm not 100% sure, is that going to put Walmart off launching thousands of cheaply made plastic products?

Suzy Davidkhanian (22:50):

So that is a very good question. I had it as an and, but given that I had too many ands, I decided not to throw that one in. But so 3D printing, if you're doing just-in-time printing is actually probably more sustainable because there won't be extra plastic things lying around. I don't know how much energy 3D printing uses up, but if you think about all of the shipping of the cargo stuff that's coming in, I think all of that is part of their footprint of sustainability, so I think it should put them at parity.

Carina Perkins (23:23):

Yeah, but I don't know, because you're still selling a lot of plastic and more plastic-

Sara Lebow (23:25):

Yeah, but did they commit to not filling landfills or just to not making emissions?

Suzy Davidkhanian (23:31):

Oh, I don't know, but that's a good question. I don't know [inaudible 00:23:34].

Carina Perkins (23:35):

[inaudible 00:23:35].

Sara Lebow (23:35):

I don't know if they ever committed to not filling landfills.

Suzy Davidkhanian (23:36):

I feel like they were already. I hear what you're saying. I thought you meant around the emissions, but if it's the landfill piece, they're already selling the plastic plates, right? It's just that now we're saying the plastic plates were $3 are going to be $8 because of tariffs. So they're going to just start making them in-house.

Sara Lebow (23:52):

So, obviously I think Walmart has a lot of potential to move right now with Chinese e-commerce being challenged. This is kind of similar to my prediction, and in that sense, I could see this happening. My question is, do we have in the US right now, the machinery, the infrastructure to do 3D printed goods on this level?

Suzy Davidkhanian (24:17):

So that's another great question. I am not that knowledgeable, but a couple of years ago when we were talking about 3D printing, a few, few years ago, probably like three years ago before AI hit it big. If you remember, we were talking about 3D printing, AR, VR, and how all of that together was going to help with returns and margin. So, I think there is the capability. I think that there is the technology because there are again prosthetics, there's a laundry list of companies that are already using 3D printing.

(24:46):

The question I don't really know about is whether Walmart would build the 3D printing capabilities in-house, or whether they would just buy the tech outright. They've done both. Do you remember how they bought a farm? I mean, a farm is a big word. A few years ago they were, well, again, like four years ago, they were worried about beef production-

Sara Lebow (24:46):

Sure.

Suzy Davidkhanian (25:03):

... and there were lots of issues with beef production. So they just went in and bought some sort of capability, like a processing capability. So they've done purchasing of and figuring out how to control their supply chain in a better way.

Sara Lebow (25:18):

I just know that when the tariffs began, something that our colleague Zach brought up is this idea that all of this manufacturing will come to the US is challenged by the fact that we don't have the infrastructure to do this kind of manufacturing at scale. And in order to build that infrastructure, we would once again have to import either the machines or the goods to create that infrastructure.

Carina Perkins (25:42):

That's a really good point. Yeah.

Suzy Davidkhanian (25:43):

Yeah. So I mean, we don't have to believe my 3D printing, but what I will tell you, that's if I need to make toilet paper and the Procter & Gamble factory in the US has three things that make the toilet paper, and they were buying from Mexico that was making two of that, the slots. Now they have to make five slots here, so they have to produce the vats and whatever. So they don't even have the space for that, so their throughput is harder to put through.

(26:14):

I take your point, this is a slightly different endeavor in that rebuilding the car factories, rebuilding a bunch of things, too hard. It's a 10-year project, it's not a two year, one year project.

Sara Lebow (26:25):

Yeah, and it's hard to know-

Suzy Davidkhanian (26:27):

[inaudible 00:26:27] power.

Sara Lebow (26:27):

... sort of what the tax policies will be in 10 years.

Suzy Davidkhanian (26:29):

Yeah, that's true.

Sara Lebow (26:30):

So I'm going to give this a half, because I definitely agree with Walmart making Shein, Temu-like moves. I'm not sure if the infrastructure's there for this one. Carina?

Carina Perkins (26:40):

Yeah, I'll give this a 65%, I think. I love the idea, I definitely could see it happening. I think there's a few questions around it, but yeah, interesting.

Sara Lebow (26:52):

All right. Carina, give us your prediction.

Carina Perkins (26:54):

Okay. My prediction is that OpenAI will launch a plug-and-play AI store associate for retail stores. So by the end of 2025, which I appreciate the timescale is perhaps a bit optimistic, it will partner with a major retailer to pilot a GPT-powered digital store associate, which will be deployed on smart screens in-store.

Sara Lebow (27:17):

100%, I agree with this. I buy this, this makes so much sense to me. First of all, on the retailer websites, we're already seeing this, maybe not with ChatGPT specifically, although it is with a lot of them. I think that ChatGPT is the name you want to be seen partnering with, and that's why I think this is going to happen in store. Will it work in-store? I don't know, we see ChatGPT hallucinate. I don't even know how strong ChatGPT's partnerships business is. I know they have a lot of partnerships, but I don't know how good they are at the pipeline of information coming from retailers and working with a retailer with 10,000, 100,000 SKUs is different than working with an online database. So I don't know how well it'll work in-store, but if I'm a store once again, like Walmart, I would love to be seen piloting a ChatGPT in-store associate partnership.

Suzy Davidkhanian (28:10):

You know what? Can you tell me a little bit more about this? Take Walmart, who has their two different sort of chatbot helpers that are GenAI enabled, probably predictive, all of the above sort of buzzwords for AI that we talk about. So my first question is, why would you partner with the OpenAI instead of just build it in-house? But I also didn't understand, so when you go into the store, will you see a TV screen and you'll click it and have a conversation with the TV screen? Or will it be like the Instacart cart where you get a cart and there's a screen that follows you along? Or is it that the associate is going to use a handheld that helps them? Tell me more about that piece.

Carina Perkins (28:51):

Yeah, so I love all of those ideas. Thank you, and I'll steal them for my own.

Suzy Davidkhanian (28:55):

Yes, please.

Carina Perkins (28:56):

So I could really see this working best actually in the UK where in-store retail media is becoming a really big thing, and you've got retailers have really extensive now digital screen networks in their stores. So there are screens at islands, there are screens outside the stores, there are screens, Tesco has digital self scanners so you go around and scan your shopping. It's offering retail media on those screens, why not also a helpful shopping assistant? So you could say, "I need to tea bags, what aisle are they? Oh, they're an aisle six. Oh, I really need a cake for dinner tonight, I need six." Tell you what kind of cake you should get. Maybe tell it a recipe or something that you want to cook and it will tell you where to go and get your groceries.

Suzy Davidkhanian (29:35):

It's interesting, because if you think about some of the apps in the US, this might be one of those retail has evolved in different ways in different markets, because Canada too doesn't have quite as many screens, but it has way more screens in the US. But if you go to the Home Depot app, I'm pretty sure that it's still there, there are a few of these branded apps where if you go to the app and you say, "I'm looking for X," it'll tell you what aisle in that store if you enable the location, because obviously not everything is in the same aisle in every store. So it's almost like a souped up version. I believe this, I think it's already happening in the US with some apps. I just don't know if you need the ChatGPT. I heard what you've said about it giving you extra boost of credit. I just don't know if you need it if you're already sophisticated enough. It's almost like it'll help the little brands get there faster.

Carina Perkins (30:21):

Well, I think it depends on how. In the US you've got Walmart, they're investing kind of huge. They've got their own massive AI infrastructure, but that's not the case throughout the rest of the world necessarily. I appreciate this is the kind of US focused one, but even some of the big retailers in this country don't necessarily have their own AI infrastructure. They're kind of partnering with suppliers. So I think that, yeah.

Sara Lebow (30:42):

It's Costco. Costco is going to do it. Costco doesn't have a digital infrastructure and they need a partnership. People in Costco are already members, so you could get logged in members using their phones.

Suzy Davidkhanian (30:56):

I don't know, this is a tricky one, right? Because it's the same as the 3D printing.

Sara Lebow (30:58):

Well, it's like Sam's Club because so many people use the app in Sam's Club but Walmart is building out its own, yeah.

Suzy Davidkhanian (31:04):

Yeah, whereas Costco, you don't need. Costco, you never, there is no even app. And this comes like the beacon technology in that you have to put so much money. Again, I think this is a UK thing, where some of the smaller stores, smaller brands who don't have their own will do it. Here, we're not even ready to get there because if you take a Costco, there is no-

Sara Lebow (31:04):

Website.

Suzy Davidkhanian (31:26):

The only, well, they're a stores first, they have a very small app. If it wasn't for COVID, they wouldn't even have delivery, I don't think, really, except for giant items. Their stores are gigantic, it's like a warehouse, but there are no TVs anywhere to be found except for the TV electronic section.

Sara Lebow (31:44):

The TV aisle, yeah.

Carina Perkins (31:45):

I could see Tesco doing something like this because they have such a massive digital infrastructure in their stores now. And also they have a really robust loyalty program, which is very linked to their retail media. And I think if you can tie all of that loyalty card data, if the AI were to know that you're a club card member, it would know what you've previously bought. It could say, "Oh, don't forget to buy your Twixs because you really like them for tea time."

Suzy Davidkhanian (32:09):

Wait, Twix?

Carina Perkins (32:09):

I mean, really interesting applications, but.

Suzy Davidkhanian (32:11):

Did you say Twix?

Carina Perkins (32:12):

Yeah.

Sara Lebow (32:12):

Because we've already gotten [inaudible 00:32:13].

Suzy Davidkhanian (32:13):

Like the chocolate bar?

Carina Perkins (32:14):

Yeah.

Suzy Davidkhanian (32:15):

You have that for tea time?

Carina Perkins (32:16):

Do you know what tea time is?

Suzy Davidkhanian (32:17):

Yeah, it's when you drink tea at 4:00, no?

Carina Perkins (32:20):

Yeah, when the tea alarm goes off.

Suzy Davidkhanian (32:22):

Yeah, but you have it with-

Sara Lebow (32:23):

What's a tea alarm?

Suzy Davidkhanian (32:24):

Wait, but Twix in America is that chocolate bar.

Sara Lebow (32:26):

Is a tea alarm a real thing?

Suzy Davidkhanian (32:27):

You're not having tea with a chocolate bar?

Carina Perkins (32:30):

Sure, why not?

Suzy Davidkhanian (32:31):

Oh, I don't know. That seems very not butter biscuits and-

Sara Lebow (32:35):

Suzy, are you-

Suzy Davidkhanian (32:37):

... digestives and-

Sara Lebow (32:40):

Are you buying Carina's OpenAI prediction?

Suzy Davidkhanian (32:41):

I'm half in.

Sara Lebow (32:42):

I'm fully in, especially for a publicly traded company. I think that this sort of partnership would be great for evaluation. I'm in. Did I add another layer to it that you wanted to get into?

Carina Perkins (32:52):

I mean, can I say that I'm not even 100% sure that I'm in, just because I'm not sure that the technology's there yet, but I'm going to go with it. The win.

Sara Lebow (33:00):

Okay. That is all we have time for today. Carina has to get to tea time, her tea alarm just went off. Thank you so much for being here, Carina, and congratulations on your wedding next week.

Carina Perkins (33:11):

Thanks so much, Sara.

Sara Lebow (33:13):

Thank you for being here, Suzy.

Suzy Davidkhanian (33:15):

Thanks for having me.

Sara Lebow (33:15):

Congratulations on your great predictions.

Suzy Davidkhanian (33:17):

Thank you, I'm very excited about it.

Sara Lebow (33:19):

Thank you to our listeners and to our team that edits the podcast. Marcus, Victoria, Stu, Lance, John, and Danny, I predict that I will miss you all so much. Please leave a comment or review and remember to subscribe to the Behind the Numbers podcast. The team will be back next Wednesday with another episode of Reimagining Retail, and on Friday, join Marcus for another episode of Behind the Numbers, an eMarketer podcast made possible by Quad.