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Retail Brew // Morning Brew // Update
How advertising fits in agent-to-agent shopping.
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In today’s edition:

—Vidhi Choudhary, Alex Vuocolo

MARKETING

AI ads ChatGPT

Tadamichi/Getty Images

As people get comfortable using AI-powered shopping assistants to buy things on their behalf, ​​the industry’s next order of business is figuring out how advertising fits into this new shopping experience.

Recently, OpenAI said that soon it will begin testing ads within ChatGPT. Initially, ads will appear below ChatGPT’s answers when a relevant sponsored product or service matches the conversation, and will be clearly labeled to stand out from a regular response. OpenAI is borrowing from Amazon’s playbook which also started out by selling pay-per-click sponsored ads back in 2012.

Meanwhile, Amazon recently released a new interface that lets AI agents communicate with Amazon’s ad systems. Amazon’s new Model Context Protocol server lets AI agents like Claude and ChatGPT translate plain-English requests directly into Amazon’s ad console, making things like managing campaigns and handling accounts agent-led.

These moves will push regular digital advertising on retail sites out of the spotlight, which means ads of the future will sit within retailers’ tech stacks or ad consoles and become part of the agentic conversation or agentic browsing experience, experts told Retail Brew. AI will show items based on clean product data, accurate pricing, real-time inventory, customer ratings, and brand trust signals. So, the best ad may just be a five-star review and a SKU that actually exists.

Keep reading here.—VC

From The Crew

SUPPLY CHAIN

Warehouse assembly line

Motoed/Getty Images

If the last few years of global trade disruptions have taught us anything, it’s that behind every storefront, shelf, and product is a supply chain so complex that sometimes even major corporations can’t keep track of it all—let alone your average consumer.

In the interest of demystifying this murky world of logistics, Benjamin Y. Fong, associate director of the Center for Work & Democracy at Arizona State University, has taken on the herculean task of mapping out the supply chains of national retailers such as Walmart, Target, The Home Depot, and Dollar General.

The project, which Fong publishes on Substack under the title “On the Seams,” as well as in the publication Phenomenal World, has produced several primers detailing how each company’s supply chain functions—with a focus on the role of labor—and where exactly fulfillment and distribution centers are located across the US.

Retail Brew spoke with Fong about his methods for uncovering the physical footprint of supply chains, the state of automation in logistics, and the crucial differences between e-commerce distribution and traditional retail.

Keep reading here.—AV

E-COMMERCE

Google's new buy button agentic ai

Google

Google is rolling out its new set of agentic AI tools, launched just last month, to third-party e-commerce platforms.

Its Universal Commerce Protocol (UCP) will now let people buy items from online marketplaces Etsy and Wayfair without ever leaving Google. US shoppers can buy items available on Etsy and Wayfair when they search within AI Mode or when they use Google’s AI agent Gemini, the company said on Wednesday.

AI Mode is Google’s AI powered search tool that rolled out last May, and shoppers will see more of it when using Google’s AI shopping experience. Google’s update points to the larger trend of execution and adoption of agentic AI across the retail industry.

Keep reading here.—VC

Together With Walmart Business

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Morning Brew Inc.

From e-commerce to retail shelves, Kim Dao unpacks how Every Man Jack approaches marketing with intention. She’ll cover how content, data, and community work together to build brand trust, stand out in-store, and drive long-term growth in a competitive category. Grab your ticket and catch it live in New York.

SWAPPING SKUS

Today’s top retail reads.

Taking over: Inside Aritzia’s grand expansion plans. (WWD)

TBD: Why some CBD products may be facing a ban later this year. (the New York Times)

Cheap thrills: McDonald’s topped Wall Street estimates as it bet on value and affordability. (the Wall Street Journal)

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