Latest / Retail Media Breakfast Club / AI Is Quietly Rewriting Retail Media: What Happens When Shoppers Stop Searching?
Transcript
- ADSN podcast snips: Sam Khour Marchitecture === [00:00:00] Kiri: Sometimes I feel like a real Debbie Downer about how AI will affect retail media. Like I'm the Town and Crier in the town square, ringing my bell and yelling. The end is [00:00:15] ni and I can see from my commentary about how AI enabled commerce will affect retail media, that people are interested, but the retailers and folks leading retail media networks generally seem to keep pretty [00:00:30] quiet on this topic, although it was the top rated concern from retail media network leaders per a study last year from Bain and company and e-marketer. [00:00:41] So the silence is a little bit telling. [00:00:43] [00:00:45] Kiri: I was encouraged to hear that this topic is also top of mind for architecture, which is a publication focused on the advertising industry that I greatly respect. Sam Curry, the chief [00:01:00] strategy officer, appeared on the A DSN podcast last week and said something that I've been thinking about constantly the last few months. [00:01:09] People in our industry might want to hide from this shift hoping it goes away or that [00:01:15] it doesn't affect them in their situation, but. Consumer behavior is already changing, [00:01:23] so let's listen in to what Sam has to say about how he thinks about AI enabled [00:01:30] shopping, impacting the broader publisher and advertising space. [00:01:35] Sam Khoury: I think what we're feeling right now, and I say this uh, with care and love for, for everybody we work with, I think everybody is feeling a little bit of [00:01:45] pressure. [00:01:45] In 2026. Um, and I think one of the big topics that we're moving into for the conference is how do we alleviate that pressure by educating you more, um, on trends and topics that are happening. I don't [00:02:00] think publicly people speak about how big of a risk the changes that's coming in the next 12 to 18 months. [00:02:07] And this isn't fearmongering, I think this is true. User consumer shifts in the way they consume content. Um, and [00:02:15] how you can reach them. And I think people are generally trying to hide a little bit from it and hoping that it just goes away. Um, but the consumer behavior is like absolutely changing. [00:02:24] [00:02:26] Kiri: Sam is absolutely right that people seem to be kind of hiding from this, but [00:02:30] the data doesn't lie. Chat, GBT referrals to US retailer websites more than doubled year over year. [00:02:37] Climbing from 7% to 16% according to SimilarWeb. And another super interesting [00:02:45] stat is from the Acosta group and they found from their panel of shoppers that 18% of shoppers used LLMs while shopping in store. Over the Thanksgiving weekend. So this isn't a future problem, [00:03:00] it's a now problem. [00:03:01] Sam Khoury: I look at myself and my, my journey online and how that's changed, I think historically. Um, Google was my source of research, my source of [00:03:15] finding a restaurant, my source of taking a look at flights. Uh, my behavior has entirely changed. [00:03:20] I start with Chachi pt. That's the first place I go when I say, what's the best alternative flight from Los Angeles to New York City. I click the link and then [00:03:30] it lands me somewhere for me to research more. Um, any research documentation I need, uh, starts there. Um, so my biggest fear and what keeps me up at night is what happens to the open web, and if these numbers continue to [00:03:45] drop, the way they have dropped over the last few years in particular. [00:03:48] What is the best way to monetize this traffic? And that's really important for publishers to survive. Um, but it's also really important for advertisers and marketers to understand how to target people. [00:03:58] [00:04:00] Kiri: Sam's experience here mirrors my own. I recently had the sudden urge to buy a fancy hairstyling tool, and so I ran my criteria by chat GBT. We hashed out the [00:04:15] options and I selected a retailer based on price and delivery time. That chat, GBT actually helped me. Uncover. So I arrived at the retailer's website having already decided [00:04:30] on the exact skew that I wanted. [00:04:33] The retailer still made the sale, right? So what's the problem? Well, the problem is I'm no longer browsing, comparing, or researching on a [00:04:45] retailer's own properties. And that upper funnel activity is where the intent signals live, where the ad inventory lives, and where the measurement narrative starts. AI enabled shopping ushers in an era of fewer signals, fewer [00:05:00] surfaces, and a fuzzier story. Did you know that leading retail media networks drive 85% of their ads through [00:05:15] mid and long tail advertisers? [00:05:17] Kiri Masters: Miracle Ads provides full funnel ad formats tailored to both one P and three P advertisers leveraging unique AI capabilities that provide unprecedented levels of [00:05:30] relevance and engagement. Retailers who want to capture ad spend from the long tail of three P Marketplace sellers use miracle ads in their tech stack. [00:05:40] Learn more@miracle.com. That's [00:05:45] M-I-R-A-K l.com. [00:05:47] [00:05:48] Sam Khoury: the things that we address are really varied, right? Like, uh, the demise of social, like we're seeing the new generations start to drop off, off social media. Like we're starting to see [00:06:00] that the attractiveness of social is not there as much anymore. [00:06:04] We're seeing all generations across all age brackets. Uh, adopt, uh, AI for research and learning and whatever editing is [00:06:15] happening there. Uh, and what exactly does this mean for a brand? Like if a, if a u if they were targeting users on Google or on webpages, and now that user has shifted 30, 40, 50% of their time away [00:06:30] and is using, you know, Gemini. [00:06:33] What does that mean for them in terms of targeting that user that was once on a website and is now no longer on the website 50% of the time? And so we really wanna address on the advertiser and brand side, [00:06:45] what does this mean for you? Like how are you shifting your budgets? Like how should you be thinking about the way you speak with your clients as an ad tech company? [00:06:53] What does this mean for you if you are servicing the open web? Um, what does that mean in a better user experience for the ad [00:07:00] formats that you have? And so we're really digging into, uh, the changing world, which I don't think has ever been bigger than now. Maybe the last time was maybe the shift to mobile. [00:07:12] Um, but I think this is probably one of the biggest [00:07:15] changes we've seen in our industry in, in, in my life, at least. [00:07:20] ADSN host 2: Yeah. And, and I guess for, it's funny thinking about the programing of like, how much of it is like fear-based versus, uh, not like fear. Yeah. Well, [00:07:30] that's [00:07:30] Sam Khoury: what I said. I'm not fear Mario, but I There's a lot of change. [00:07:32] ADSN host 2: Yeah. [00:07:33] Sam Khoury: I mean, there's a lot of change. [00:07:35] [00:07:36] Kiri: Sam, comparing this shift to mobile is significant. That was an industry redefining moment, but I'd [00:07:45] argue this one cuts deeper. For retail media specifically, mobile changed where consumers shopped. AI is changing. How they discover, how they research, how they decide. [00:07:56] Those upper funnel moments are the foundation that retail [00:08:00] media was built on. [00:08:01] And this pattern recognition is important. The retailers and retail media networks who recognize this shift early have runway to adapt. [00:08:11] Those who dismiss it outright as futuristic [00:08:15] speculation might find themselves reacting to market forces rather than shaping them. We don't get to choose whether these shifts happen, but we do get to choose when we notice them. [00:08:27]