Latest / Retail Media Breakfast Club / Retailers Are Finally Embracing AI Shopping Bots — Here’s What They Announced at NRF
Transcript
- At NRF, Retailers Say "Bring On All The Bots" === [00:00:00] Kiri Masters: For a decade, retailers have fought to keep bots off their websites, but at N F's big show earlier in January, I found that major retailers are now racing to welcome AI shopping agents to their [00:00:15] website. [00:00:15] Here's what Rob Freeman, CIO of urban as in the parent company of Urban Outfitters and Anthropology said from the stage, he said, we've spent the last decade saying no bots on our site. Now we're saying the opposite. We're saying, [00:00:30] bring on all the bots, buy all the things. And that line captures this philosophical whiplash that retailers experienced earlier this year at the event where Gentech commerce dominated stage conversations, booth demos and hallway [00:00:45] debates. [00:00:45] But what are the retailers welcoming these bots to do? Exactly. And how fast. [00:00:52] I spent three days at NRF attending these panels and tracking the announcements from major retailers, and I found a real [00:01:00] spectrum in terms of how brands are approaching this, what are they already live with? Others are testing carefully and some are still questioning whether full autonomy is even desirable. [00:01:13] So in this podcast today, which [00:01:15] is a recap of a full, , column that I wrote for, for the drum a couple of weeks ago, I'm gonna share what six major retailers have said about their agentic commerce strategies and what they're actually building. [00:01:27] [00:01:28] Kiri Masters: Let's start with [00:01:30] Kroger, who is leaping out the gate with full deployment. [00:01:34] So Kroger announced a partnership with Google earlier in January that includes both a meal assistant and shopping assistant that can handle complex multi-step tasks [00:01:45] from a single instruction. So here's what it can do. A customer planning a week of dinners seeking recipe inspiration or jumping into a new food regimen will be able to ask the Kroger assistant to create a shopping list [00:02:00] based on their immediate needs, their budget, and their family's unique preferences. [00:02:04] Importantly, Kroger's recommendations are grounded in its actual assort. real time pricing and availability, not generic suggestions that might not match what's actually in [00:02:15] stock. And that's a challenge that a lot of people have today with AgTech shopping assistance, is that they get things wrong all the time. [00:02:21] So Kroger's is based on its actual product. Feed the system can convert requests like I want to prepare vegan [00:02:30] tomato soup into guided recipes with detailed ingredient lists that populate shopping carts with a single click. That sounds awesome. I'm gonna try it right after I finish recording this [00:02:40] second retailer, sharing a big announcement was Lowe's. Lowe's [00:02:45] made headlines by being one of. The first retailers to launch Google's business agent, and this allows customers searching for Lowe's on Google to engage in conversation with what Nima Sharma, SVP of technology, uh, for [00:03:00] e-commerce and omnichannel product at Lowe's calls the knowledge of Lowe's, and it can complete transactions without leaving the browser. [00:03:08] Here's what Nima told Omni Talk retail at NRF. She said, our mission is solving problems and [00:03:15] fulfilling dreams for the home. As AI and Agen is taking us by storm, I really think that Lowe's will be making more and more judgment calls on behalf of the customer. That trust will continue to grow and we are actually gonna allow customers more time to dream [00:03:30] and less entangled in solving problems. [00:03:33] And Joe Cano, the SVP of Digital at Lowe's emphasized that shift in mindset. He said, instead of testing and learning, we are going other AI investments included. Kitchen [00:03:45] visualizer built on Google's Imagine model, and My Lowe, which is an onsite shopping assistant. Retailer. Number three, alter beauty and at the core, having a marketplace as ag agentic infrastructure. [00:03:59] So alter [00:04:00] took a bit of a different angle at NRF positioning its year old marketplace as strategic preparation for agentic commerce by expanding their product assortment through third party sellers via the Miracle Marketplace [00:04:15] platform. Alter is creating the content depth that AI shopping assistance will need to make relevant recommendations. [00:04:22] Here's what Josh Friedman, the SVP of e-Commerce and Digital at Alter had to say from the stage. He [00:04:30] said we kind of knew that in the back of our head. It wasn't always a primary objective for us in the marketplace, but we knew having more assortment would matter. Ulta was also a founding partner in Google's Universal Commerce Protocol or [00:04:45] UCP that was announced at NRF and their betting on that standardization to scale efficiently. [00:04:51] The team is thinking about agentic commerce in two dimensions. One, optimizing their own site for conversational shopping, which [00:05:00] PayPal's, VP of Ag Agentic Commerce, Mike Edmonds, calls onsite ag agentic and considering how its loyalty program acts as a competitive advantage in that context. But alter is also preparing for agent to agent commerce where [00:05:15] platforms like Google might route customers to alter based on product availability and fulfillment capabilities. Miracle Ads is the Ad Tech solution trusted by [00:05:30] Rakuten and over 50 global enterprise retailers. That's because Miracle Ads was built with both three P Marketplace sellers and one P suppliers in mind. Both advertiser audiences demand a seamless [00:05:45] advertising journey from onboarding to reporting. [00:05:48] You can offer everything from sponsored products to video ads all in one solution. Learn more@miracle.com. That's M-I-R-A-K l.com. [00:05:59] [00:06:01] Kiri Masters: Retailer number four, home Depot. Home Depot is taking a problem. First approach to agent Commerce, resisting the hype around fully autonomous shopping. [00:06:12] Instead, the retailer's onsite Magic [00:06:15] Apron assistant focuses on helping customers navigate complex home improvement projects, understanding what they're trying to accomplish, and recommending products accordingly. [00:06:25] As for the offsite agent commerce piece. [00:06:27] Home Depot's Chief Information [00:06:30] Officer, Angie Brown, emphasizes that Home Depot will maintain the merchant of record role even when transactions happen on other platforms. And this is a really important point and a way for retailers to not seed all of their [00:06:45] advantages to these AI shopping assistant and agents. [00:06:48] And that is maintaining the merchant of record role [00:06:51] so that they're there to facilitate things like warranty returns. They get to continue to be a part of the customer [00:07:00] relationship and not just hand everything off to a third party tech platform where they'll be completely disintermediated. So what she said is, you think about this buying experience and it's not just about the research you do beforehand. [00:07:13] You also think about what happens [00:07:15] as you are transacting with that retailer. Warranty returns, and us as in Home Depot, being there as the merchant of record to continue to bring our brand to the experience is a key part of that. [00:07:26] Retailer Number five, Wayfair. Fiona [00:07:30] Tan, who is Wayfair's chief technology officer, explained how the furniture retailers category is a very emotional, very style based, very difficult to describe type of category, and that makes it particularly well-suited for [00:07:45] conversational interfaces and visual ai. She has a really optimistic view of how agentic shopping could improve the furniture and home. [00:07:55] Um, Decor buying experience. She says, we've been handicapped [00:08:00] with the 20 year e-commerce experience, which is a search bar. Now we have the ability to leverage not just the conversational part, but multimodal capabilities. How do I show you real products from my catalog that you get to see and pull off of it? [00:08:14] And so [00:08:15] the company is investing heavily in foundational capabilities like product data quality and structured content, which she says is also much easier today. With new technology than in the past. She's also clear about [00:08:30] participation. She said We wanna give customers the choice. If you are wanting to do the research and discovery on one of the platforms and then check out, we will still own as merchant of record, the ability to fulfill, manage customer service, and handle returns. [00:08:44] [00:08:45] Finally from Urban Outfitters, the comment about bring on all the bots. This pivot informed Urban's partnership with Stripe to ensure secure transactions while maintaining brand control over the customer [00:09:00] experience. The urgency became clear last week when Microsoft launched its first Gentech commerce experience in the US featuring anthropology and Urban Outfitters amongst its first partners. [00:09:11] Urban is now live in one of the first mainstream [00:09:15] agent shopping deployments, making the bring on the bots philosophy, operational reality rather than aspiration. [00:09:21] So obviously there is a big range here around what retailers are doing or planning to do, or even just philosophically thinking about [00:09:30] what the future of shopping looks like. But perhaps the most telling pattern across every one of these conversations was the insistence on maintaining that merchant of record role. [00:09:40] Retailers will meet customers on Google Chat, GPT or [00:09:45] wherever, whatever surface emerges next, but they're not seeding ownership of. Fulfillment returns, customer service, the bots can come. The relationship stays with the retailer. [00:09:57]