Welcome to the Retention Edge.
We’re back with everything you need to know from the past week in ecommerce, marketing and retention.
Here’s what’s coming up in this week’s edition:
OpenAI, Amazon and Google all turn ads into AI agents heading into the holidays.
Gen Z is adopting AI shopping fast, and dropping brands over sloppy AI just as fast.
Bain says the holidays will top $1 trillion, with 1 in 4 shoppers starting on AI.
94% of TikTok Shop luxury resale now happens on livestreams.
Let's get into it.
OpenAI, Amazon and Google Are Putting AI Agents in Their Ads
Three of the world’s biggest platforms are moving on something that could radically change how online advertising works: embedding custom agentic experiences in ads, potentially creating a world where customers discover and buy all from within an ad.
OpenAI is testing ads that open a chat with your brand, not your website
OpenAI started showing select advertisers a new ChatGPT ad format it calls a Sponsored Agent. Instead of sending the click to your site, the ad carries a "Chat with us" style button that opens a conversation with the brand's own AI agent right inside ChatGPT. Wayfair is one of the testers, and says it is moving carefully on accuracy and handoffs to human service.
Amazon Ads now plugs straight into ChatGPT
Amazon Ads announced a partnership with OpenAI that lets advertisers extend their existing Amazon Ads campaigns into a conversational ad experience inside ChatGPT. It’s a US pilot for now, with a handful of brands like Delta Vacations in early.
Google is putting a Business Agent inside YouTube ads
Google opened a US beta that embeds a brand's Business Agent directly in YouTube ads, so a viewer can ask detailed product questions and get tailored answers without leaving the video. It also added cart transfer for merchants using its Universal Commerce Protocol checkout, so an ad can carry a shopper from question to cart. Google says brands that adopt its core feed best practices see roughly a 5% conversion lift the following month.
The Shopify Beat
Your Shopify admin is getting a new look
Shopify is rolling out a redesigned admin to every store: new color, type and spacing, with search, notifications and the store picker folded into a collapsible side nav, and Sidekick now a floating chat on every page.
You can now collect WhatsApp marketing consent at checkout
Shopify added the ability to capture WhatsApp opt-ins at the point of purchase, turning checkout into a build point for a high-engagement list you couldn't grow there before.
Multi-currency payouts arrive in Australia and France
Advanced and Plus merchants in Australia (13 currencies) and France (18) can now be paid out in the currencies they sell in, cutting the conversion losses that quietly eat into international margins.
ChatGPT Ads for Shopify are live, with Shopify as OpenAI's first commerce partner
Harley Finkelstein announced that ChatGPT Ads are now live for Shopify merchants, with OpenAI pulling product data straight from Shopify Catalog. It is free to install, you set your own campaigns and budget, and it is all tracked from the Shopify admin. If the OpenAI story above is the "why," this is the "how" for Shopify stores.
AI Commerce
Gen Z adopts AI shopping fast; as long as it’s used right
A new SAP Emarsys loyalty study of UK consumers found 48% of Gen Z have bought a product an AI assistant recommended, but 43% have switched brands over how a brand used AI.
This demographic is showing up as the fastest to adopt AI, but at the same time, more acutely aware of it, when it’s being used, and when it’s being misused.
People still want access to humans if something goes wrong, transparency, and peace of mind to know the data they’re giving AI assistants is safe.
Semrush: AI chatbots talk more than half of users out of a purchase
In a July survey of 2,338 US adults, 57.5% of AI users said a chatbot had talked them out of a purchase, and almost exactly the same share said one had talked them into buying something.
Another reminder of the growing influence AI platforms are having on us.
Cloudflare now blocks AI shopping agents by default on pages that carry ads
Cloudflare rolled out a default setting that blocks user-directed AI agents on any ad-supported page, while still allowing search crawlers. Its logic: an ad is proof a page was built for a human, and an agent reads the price and reviews and leaves the ad unseen.
Profound raised $180M at a $1.8B valuation to help brands show up in AI answers
Profound, an answer-engine-optimization startup, raised a $180 million Series D co-led by Sequoia and Kleiner Perkins, less than seven months after its last round. It says revenue tripled in six months across more than 1,000 enterprise customers including Walmart and Estée Lauder.
Ahrefs: AI Overviews cut clicks by roughly a fifth for the sites most exposed to them
When Google launched AI Overviews in France, Ahrefs tracked the top 1,000 domains and found median organic click-through rate fell 23.1% in the nine days after, for the sites where more than a fifth of queries trigger an overview.
The Consumer
Retail sales jumped in August, but shoppers are hunting for lower prices
US retail sales rose 1.2% in August, the biggest gain since March and well ahead of forecasts, up 6% year over year.
Reuters notes the strength leans on higher gas prices and wealthier households, while consumers "have become more selective and are seeking lower-priced goods."
Bain says the holidays will top $1 trillion, and 1 in 4 shoppers will start on AI
Bain forecasts US November-December retail sales up 4.5% to more than $1 trillion for the first time, though it warns inflation accounts for over half of that nominal rise.
Online is set to grow 9%, nearly four times in-store, and 24% of shoppers plan to start their holiday shopping on an AI platform like ChatGPT or Gemini, up from 17% a year ago.
Amazon boosts its minimum starting wage to $20 an hour
Amazon raised pay by $1 an hour for eligible core-operations staff, taking its full-time starting minimum to $20 and the average to about $24, and stacked on new grocery and banking perks. Even if you never touch Amazon's warehouses, its wage moves reset the labor-cost benchmark for the 3PLs and fulfillment partners you do pay.
94% of TikTok Shop's US luxury resale now runs through livestreams
At TikTok's first Luxury Resale Summit, the platform said 94% of its US luxury-resale revenue this year came from livestreams, with the category up 400% year over year, mostly handbags and watches.
It’s most notable that live video actually seems to be a major benefit for high-consideration categories like luxury, where trust is crucial. Sellers (and re-sellers) are better able to convey this in a live video format than they are through static pages alone.
Platform Moves
Pinterest is repositioning as a performance channel with Visual Search Ads
Pinterest introduced Visual Search Ads, which place ads inside search results and Pin close-ups, alongside an expanded Performance+ AI suite and a new Restyle feature.
CEO Bill Ready pitched the platform as full-funnel performance, leaning on the fact that 96% of its searches are unbranded. For brands fighting rising CAC on Meta and Google, this could be a high-intent, lower-competition surface worth testing.
Target's Shipt adds an AI shopping assistant, same day as Instacart
Shipt launched Ask Shipt, an assistant that builds a cart from a description or a photo of a dish you want to cook, on the same day Instacart announced its own. The delivery layer is becoming another AI-mediated storefront. If you sell through Target or Instacart, watch how these assistants reshuffle which products get surfaced.
Brand and Money
Lulus is leaning hard into wholesale, starting with Macy's and Bloomingdale's
Lulus, a DTC-native brand, is expanding into Macy's and Bloomingdale's on top of Nordstrom, Dillard's and Amazon. CEO Crystal Landsem frames wholesale as a "profitable brand marketing channel" to meet new, especially Gen Z, customers and then bring them back to owned channels.
BuyWander raised $21M to turn returns into an auction business
BuyWander pulled a $21 million Series A co-led by Madrona and Inspired Capital for its model of auctioning returned and overstock goods. Items from Amazon, Target and Walmart open at $1, run a seven-day auction, and the winner drives to a local warehouse to collect.
Returns are a margin killer for DTC, and a scaling resale channel gives operators a new place to move overstock instead of writing it off.
Retail media is a margin line, even for smaller merchants
Practical Ecommerce makes the case that retail media is not only for Amazon and Walmart: any merchant with an audience it already paid to acquire, like a newsletter or category pages, can sell high-margin ad space to its own suppliers. It reframes shopper-acquisition cost as the price of building an asset you can then rent back out.
Also This Week
Amazon grounds carrier partner 21 Air after a fatal Miami crash - a delivery-network resilience question right before peak. Read more →
Toys R Us is opening 120 stores for the holidays - the online-native-goes-physical trend keeps running. Read more →
Nike adds LVMH's Alexandre Arnault to its board - a signal on how the DTC pioneer plans its turnaround. Read more →
Rent the Runway names a Nordstrom veteran CEO and refocuses on core rental - another DTC pioneer paring back side bets to fix the core. Read more →
Best Buy opens its holiday gifting center early, with Google and Meta shop-in-shops - peak discovery pulled forward, retail media moving in-store. Read more →
FedEx launched a Shopify app to tame surprise import fees - a cross-border checkout and cost tool for merchants. Read more →
Snipp is putting brand rebates inside ChatGPT and Claude - promotion discovery follows shoppers into AI assistants. Read more →
Meta launched a creator-marketing hub - lower friction for finding and running creator partnerships in its ad system. Read more →
Euka raised a $5M seed to take its TikTok Shop playbook to Instagram - creator-selling infrastructure porting from one platform to the next. Read more →
Perplexity is running conversion-judged creator campaigns of 100-plus - a conversion-first creator model at real scale. Read more →
What DTC's been talking about on social media this week.
Your CX team may be giving customers different answers.
Eli Weiss dug into a brand that answered more than 10,000 support tickets last BFCM and found 9,600 of them were the same 27 questions. Worse, on 14 of the 20 biggest ones, its own agents were giving customers different answers, down to whether a product was latex-free. The pre-peak fix is boring and worth it: get one agreed answer to your top questions written down.
Everyone plans for peak sales. Almost nobody plans for peak returns.
Ari Murray makes the case that the wave right after the holidays is its own event: returns run around 17% of everything bought, and January alone is a third of the year's returns. Plan for it now, with a return policy, exchange and store-credit incentives, and CX staffing sized to last year's January, not last year's December.
AI-agent search is small until it isn't, and it rewards the brand people talk about most.
Joe Marston points to John Lewis, where AI-agent searches climbed from 0.3% to 2.5% of all on-site searches in a year, across every age group. His read: an agent picks you because you are the most-talked-about option, so answer-engine optimization is really just performance marketing judged by a new system. Build demand and cultural presence, not a separate discipline.
Every unprofitable first order is fine, as long as it has a reason.
Rok Hladnik reframes the CAC question for Q4: stop asking "did we make money on this order" and start asking how much you can rationally afford to pay for the customer. That number comes from contribution margin, repeat rate, LTV, payback and cash flow, not from gut feel.
Your AI-written emails still sound like AI, and a brand guide won't fix it.
Ronak Shah explains why: a brand guide is a description, and AI averages descriptions into the same flat voice. Feed it examples instead of adjectives. Show it your best-converting emails and tell it to match those patterns, then give it real customer language pulled from reviews and support.
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That’s all for this week.
I’ll be back in touch soon, with an eye on what’s happening in the ecommerce and retail world, so you can keep yours on growing your business.
Until then,
Pietro and The Retention Edge Team
PS: shoot me a DM on LinkedIn if you’re interested in what a custom mobile app could do for your brand.
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