the next disruption I want to talk about is what I call the disruption of discovery so I'm a fourth generation retailer i've been doing this for over 30 years and for my entire career the greatest source of leads in any retail store is called SIS SAW in store i walked into a store for Oreos and they're on the shelf next to those Oreos were the pumpkin spice Oreos which are delicious by the way i discovered them i decided to take them home and try them and I love them uh Proctor and Gamble of course invented a name for that moment they called it the first moment of truth and shopper marketing is really based on this fundamental insight from uh Proctor and Gamble so that is really how all retail has worked is winning that first moment of truth and then continuing down the purchase funnel uh for those of you that know me you know that I have a horrible addiction to to Starbucks coffee oh and that's a great excuse to take a sip um but I want you to think about my customer experience shopping for coffee if I walk into a Target I have to walk by 38 other brands of coffee uh before I get to my beloved Starbucks section all of these brands have a chance to catch my attention to conquest me to to create a first moment of truth with me before I get to my traditional Starbucks purchase and once I get to that Starbucks section Starbucks has an opportunity to tell me about all their new products before I buy the product that I would typically buy right and that is how that first moment of truth has always worked only one problem does anyone watching this believe that that is how I buy coffee of course not right what am I more likely to do i'm more likely to type Starbucks coffee into that Target search engine and look what Target does it parachutes me right to the traditional products that I always buy from Target that it's that iced coffee that I put in my refrigerator so I can drink it while I'm I'm working from home um and I missed that chance for serendipitous discovery i missed that chance for conquesting i missed that first moment of truth and I went back to what I always buy from Target but increasingly this isn't even how people discover coffee do you know how people discover new coffee today the Tik Tok right uh this is a video that went viral a couple years ago on Tik Tok and essentially an influencer took some fulers instant coffee they put it in a cup with sugar uh with hot water they emulsified it with like a blender and then they pour it over ice and it creates this creamy caramelly sweet delicious caffeine concoction and the week this video went viral 10 other influencers made other videos the first one was seen 6 million times cumulatively this this collection of video was seen over 60 million times and I got a panic call from Walmart we are sold out of instant coffee nationwide and we have no idea why right um so that first moment of truth became a zero moment of truth on Tik Tok and think about what what happened there you had this huge spike in interest you had this huge spike in demand and as uh good and renowned as the Walmart uh supply chain is do you think Walmart could get a restock of instant coffee nationwide in a week they couldn't and by the time they did restock instant coffee this particular trend had played out right so this was a lost opportunity all this demand was created organically on social before a customer ever walked in a store but tra the traditional retail model didn't have a good way to capitalize on that demand right and this has played out every week since then with some product in some category think about a product category like sunscreen i recently planned a a vacation to Hawaii with my family so I sort of have sunscreen on the mind um and this is the traditional experience you'd have for sunscreen can anyone watching this tell what the good sunscreen is from this uh picture of course you can't right even if I took all the sunscreens out and squirted them in your hand could you tell which one worked better could you tell which one was reef safe no of course not right um so increasingly this is not the tool set that consumers use uh when they land at a selection and a loyalty for sunscreen they're way more likely to listen to Dr derm on Tik Tok right um and he'll tell you exactly what sunscreen and it turns out it's a non-FDA approved sunscreen from South Korea who knew um but ever more it's not even just these social networks and these influencers it's the LLMs it's it's the artificial intelligence so what happens when I type into Chat GBT hey ChatGBT what sunscreen should I buy for my vacation to Hawaii with my 9-year-old son and it tells me what criteria I should care about and what three popular sunscreens are that meet that criteria right and so it's doing a lot of the discovery and consideration for me and taking me right to that bottom of the funnel but uh as interesting as Chad GBT is and there's rumors that they're forming a partnership with Shopify right now they don't really have an incommerce experience on on the OpenAI platform today however Perplexity a competitor of of Chat GBT does so when I ask perplexity that same search I get a very similar result i get a set of criteria that should be important to me in picking a sunscreen it should be waterproof it should be reef safe uh it should not sting your eyes um and then it's going to recommend some sunscreens that best meet that criteria but unlike uh Chat GBT Perplexity is actually going to give me links to the retailers product detail pages where I could buy those products and if I scroll down it's for some products it doesn't just give me a link it gives me a buy now on Shopify button so I can conduct transactions right here and increasingly it bypasses uh Shopify and Perplexity becomes the commerce engine of choice and Perplexity will sell me the sunscreen direct and ship it to my house so Perplexity isn't just a search engine competitor perplexity is a commerce marketplace comp uh comp competitor that's competing with Amazon and Marcato Libra and Alibaba um with a better discovery experience and the ability to consummate the transaction right on the platform and what's really interesting is now you can take these these LLMs into the retail store with you and they can actually see through their camera hey Chad Chibbt I'm at the grocery store i need to buy some beer for a really important party i don't know anything about beer but my friends are really into craft beers uh what do you see on this shelf that I should specifically buy hey Drake i see a lot of craft beers a mix pack might be a safe bet since it offers variety if your friends like IPAs something like a hazy IPA or a local favorite would be good any particular style your friends prefer i don't know what which specific brand and variety do you think would be safest a safe bet would be a mixed variety pack from a well-known brewery like Sierra Nevada or New Belgium they usually offer a range of styles that should please everyone do you see either of those on the shelf yeah I see a Sierra Nevada pack on the middle shelf that would be a great choice it's got a nice variety perfect thanks very much you're welcome have fun at the party so I will have fun at the party and in this case uh Chad GBT helped me find this particular skew on the shelf at my local grocery store and so imagine in the near future when consumers are going up and down the aisles of a grocery store and they're asking Chat GBT which floor cleaner is going to be best for their hardwood floors or or which shampoo is going to work best with their uh uh dry thin hair type or which sunscreen is going to be best for them to take on their ve vacation um all of these things are are going to be playing out on a regular basis