A Shocking Confession from Retail Pros at NRF
Welcome to Wednesday, futurists.
The FC team has spent the past week in New York City for NRF and myriad halo events that populated the show calendar. Our bingo card of “agentic,” “AI,” and “autonomous” is quite full, as talk of the next wave of tech that nobody’s doing yet (but everyone’s talking about) sucked up all the air in most sessions, hallway conversations, and demos.
Buzzword bingo aside, it was at an industry meetup that we had a dizzying spell of déjà vu. While most of the industry is talking about agentic AI, few industry leaders have actually used these tools to help them truly understand and empathize with consumers.
At one after-hours event, the host called from the stage to over three hundred select AI and retail leaders—all duly recognized in their field—asking for a show of hands. “Who here has used AI to search for a product?”
Crickets.
Extending the benefit of the doubt, they asked again: “By show of hands, who here has used ChatGPT to search for a product to buy on the internet?” From my vantage point, a total of three hands went up. When pressed further, only one person said they had purchased something using AI.
According to recent data, this bucks the consumer trend for AI adoption:
From the perspective of an eCommerce industry veteran, this feels like history repeating itself. For more than a decade in agency leadership, I watched the same scene play out over and over again: senior leaders and executives empowered to make decisions for consumers, yet with no firsthand knowledge of the very experience they’re building for. None. At all.
At best, some had never tried Amazon Prime; in the most egregious cases, the very executives who were investing hundreds of thousands of dollars in eCommerce were themselves afraid of online commerce due to security and privacy, yet expected to earn consumers’ trust with a few badges at checkout.
Freaky-deaky familiar, if you ask me. If leaders are going to lead, they need to lead from the front.
But don’t worry, I’m here to help you catch up. So here are a few phrases to copy and paste into ChatGPT so you can at least say you used the tool when next you’re questioned at Shoptalk:
- “Show me some candles from Etsy that I can buy right here within ChatGPT.”
- “Based on everything you know about me, make some product recommendations for me that you think will improve my life, my productivity, and my mental health.”
- “Show me some unique gift ideas for Valentine’s Day that are under $100.”
Hope that helped. For more takeaways from key sessions, featuring brands like Ralph Lauren, DICK’S Sporting Goods, and LVMH, see our extensive NRF coverage below, and continuing through Friday!
— Phillip
Ralph Lauren’s Vision for Modernization. When David Lauren refers to the namesake brand as a “heritage” business, it doesn’t have negative connotations. In fact, it’s rooted in pride and an innate commitment to craft and quality. But how does a brand take a history that spans 60 years and modernize it without losing its lore? The Chief Branding and Innovation Officer sat down with Shelley Bransten of Microsoft to tell NRF President Matthew Shay how they’ve worked together to achieve just that through a 25-year partnership that now includes Ask Ralph, an AI-powered, branded agent experience that brings luxury-level curation to mobile screens.
“What my father started 60 years ago was a brand based on his own philosophy of design, and that was products created and designed with an idea of timelessness, products that are viewed with a sense of integrity and quality,” Lauren said. “Things that get better with age, things you want to hand down from generation to generation.”
Social media’s “Ralph Lauren Christmas” trend confirms that the brand has successfully upheld this philosophy, embracing its story and essence to create a sense of coziness, timelessness, and familiarity amid unending chaos. Ask Ralph is an extension of this vision, but uses AI to contextualize the philosophy within consumers’ unique needs, tastes, and preferences. As Shay noted, going into the app and using the tool “feels warm” because the visuals and storytelling feel so aligned with the brand ethos.
“We’re trying to make sure that a customer is enveloped in our philosophy,” Lauren said. “Nobody needs a tie, flannel shirt, or pair of jeans…but showing a customer how to put it all together is part of what makes Ralph Lauren unique…so we feel that technology helps us fulfill that. The idea that you can go on-site and create something that’s even more personal for you is exciting.”
When Retailers Downsized Stores, DICK’S Doubled Down. Ed Stack isn’t just the Executive Chairman for DICK’S Sporting Goods; he’s the son of the retailer’s founder, Richard “Dick” Stack. As a result, he’s not only focused on creating shareholder value but committed to upholding the values of his father and the brand. He’s also a merchant at heart, which means he amplified a refreshing message: while AI is great, great products and human-to-human experiences are the heart of great retail.
“Somewhere along the line, I fell in love with this business, and it’s a love affair that’s alive in the world today,” Stack said. “You can see it in House of Sport, a concept we started eight years ago or so. We said, ‘We’ve got to design this whole ecosystem of the future. What’s it going to be? It’s going to be around community, service, and product…the North Star of the conversation has been creating a concept that will kill sporting goods. If somebody else built this store across the street from one of our traditional stores, we would be out of business. That’s what we did.”
House of Sport is an example of a brand zigging while everyone else zagged. While many retailers were downsizing their store fleets and creating smaller, more modular concepts, DICK’S implemented a 150,000-square-foot model that includes plenty of space for touching, testing, and playing. The response has been resoundingly positive, so the retailer is adding 15 more locations this year, aiming to reach 75 to 100 House of Sport locations by 2028.
Taco Bell’s Quest to Fill Customers’ Hearts and Stomachs. Dane Mathews doesn’t use “customer” to describe Taco Bell patrons; he uses terms like “fan” and “guest.” Such a subtle word choice is a powerful testament to how he and his team advocate for customers and use technology to intentionally serve and thoughtfully engage with them. The results are paying off: as many quick-serve restaurants struggle to win wallet share, Taco Bell is driving both employee and customer loyalty.
As Global Chief Digital and Technology Officer, Mathews has led the vision for two core technology investments that have successfully served both audiences and verified that “there is only one Taco Bell.” Fan Style is Taco Bell’s multiplayer play, allowing guests to build and share custom creations and earn rewards when someone buys them. ConnectMe further nurtures customer relationships by using data and loyalty information to better align guests and employees at the drive-thru.
👁️ Want to learn more about how Taco Bell is getting brand fans to live más? Read our full recap of the conversation here.
AI’s Invisible Impact. How does a luxury force like LVMH remain on the cutting edge of tech without diverting from its incredible brand and product portfolio? Gonzague de Pirey, Chief Omnichannel and Data Officer at LVMH, noted: “For technology to be successful in the luxury sector, it needs to be everywhere but be visible nowhere. We call it ‘quiet’ technology that’s designed to serve the humanness of luxury.”
That “humanness” is found in artistic product design, the hand-crafting of goods, and in the connections client advisors form and nurture across all channels. Each Maison has its own AI transformation plan but shares an overarching tech strategy, called “AI for All.” While there’s a sense of uniformity and tech integration, each of LVMH’s 75+ brands maintains its own distinct DNA, vocabulary, and tone.
“We have noticed that there is a lot of commonality in those [Maison] priorities,” de Pirey explained. “They are very often in three main domains, and we focus our attention on those three domains: commerce, marketing, and operations. Each of them has some business opportunities, and we take the best practices in one Maison that we're able to scale in the other Maisons.”
De Pirey wisely brought the organization’s primary AI concern to the forefront. “The question of creativity is a very sensitive topic that we tackle with a lot of passion but also with a lot of prudence and cautiousness. We know that AI has a risk in terms of flattening creativity, but with pragmatism, we go testing and learning with some universities and Maisons like Louis Vuitton, where we try to embrace this idea of AI and creativity.”
Louis Vuitton is already seeing the benefits of agentic commerce as a service tool. “Agentic commerce is a kind-of digital concierge, and a natural extension of this exceptional and specific bond we build with our clients. It’s deeply personal and context aware,” said Soumia Hadjali, Louis Vuitton’s Global SVP of Client Development and Digital.
📚 Read up on AI’s Concierge Economy. Like Hadjali, we have found that AI’s power lies in its ability to synthesize information and deliver contextually relevant insights to users, whether it be service reps, brand ambassadors, or customers. Get our POV on The Concierge Economy, and join our deep-dive discussion with Tilly’s and Cimulate about how AI is shepherding a new era of customer experience.
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