Inflation, the metaverse, Gen Z consumers’ needs, and the war in Ukraine were among the hot topics at the ShopTalk conference in Las Vegas, which ended Wednesday.
The event’s theme, “Retail’s Big Reunion,” reflected ShopTalk’s return to an in-person format. The conference, owned by United Kingdom-based Hyve Group PLC since December 2019, was held virtually for the previous two years because of concerns about the COVID-19 pandemic. This year’s event was the biggest ShopTalk ever, with about 650 sponsors and exhibitors, nearly 10,000 attendees and more than 275 speakers, Hyve Group says.
Below are some of the most interesting things we saw and heard at ShopTalk 2022.
Uber wants to beat Amazon at deliveries
In a keynote interview on Tuesday with Bloomberg Technology’s Emily Chang, Uber Technologies Inc. CEO Dara Khosrowshahi said his goal is to “out-Amazon” Amazon.com Inc. in the delivery marketplace beyond restaurant meals and groceries. He also compared Uber’s offerings to those of ecommerce platform vendor Shopify Inc.
“We think of this as essentially a local Shopify,” Khosrowshahi said at ShopTalk. “We can help you power your local online commerce and the Uber platform, and the Uber audience is undeniable in the world.”
Looking at the economy, Khosrowshahi said inflation was “serious and real,” but added that it has had no material impact on Uber’s business. However, he acknowledged that rising prices — particularly the “pain at the pump” has been hard on Uber’s drivers.
Uber initiated a fuel surcharge earlier in March to mitigate the effect of rising gasoline prices on Uber’s rideshare drivers and couriers. The fee is 45 cents or 55 cents per trip for rides and 35 cents or 45 cents for Uber Eats delivery orders.
The surcharge expires May 11, but Khosrowshahi told the Shoptalk audience that Uber is open to extending the surcharge or making other alterations if fuel prices remain high. He declined to commit Uber to lowering the commissions it receives from its drivers. Uber drivers are gig workers, meaning they work as independent contractors and accept delivery or rid-share assignments when they choose.
Assuming the war in Ukraine can be resolved soon, Khosrowshahi says prospects for global economic growth are good. But he sees no signs of inflation evaporating any time soon. The goal for companies, he says, should be to grow faster than the elevated inflation levels and not count on a rapid decrease in price increases.
Khosrowshahi said Uber’s delivery business could eventually grow bigger than rides, even when the rideshare unit gets back to pre-pandemic levels, Khosrowshahi said. Uber added 120,000 non-restaurant merchants to its platform in the last year.
The Uber Eats delivery unit has grown from about $4 billion annual revenue four years ago to a roughly $50 billion run rate now. Run rate is an extrapolation of current financial performance, assuming current conditions remain the same.
Khosrowshahi said he is also bullish on the prospects for rapid grocery delivery. Last year, Uber reached a deal with the quick delivery grocery service Gopuff to sell products from Gopuff through the Uber Eats app. Gopuff uses a network of convenience-store-sized distribution centers to deliver groceries via couriers.
Other notable ideas presented at the show include:
- James Reinhart, CEO of thredUP Inc., an online consignment retailer and thrift store, said resale is “having a moment” right now — offering as evidence his appearance on the ShopTalk main stage. He warned that apparel retailers face the prospect of government regulations if they don’t address the issue of “circularity,” meaning the resale and reuse of apparel. He also proposed the idea of exempting used clothing from sales taxes. ThredUp is No. 785 in the 2021 Digital Commerce 360 Top 1000. In addition to being a retailer, thredUp offers proprietary “resale as a service” software to other merchants.
- Craig Brommers, chief marketing officer for American Eagle Outfitters Inc. (No. 49) said the apparel brand’s Gen Z store associates create some of its best digital content and events. Brommers says that strategy might seem risky, but “Gen Z smells it” when brands exert too much control over their messaging. He said brands must be willing to be a little uncomfortable to reach this young cohort.
- Bart LaCount, vice president of consumer insights, PepsiCo Inc., said reaching Gen Z shoppers required “living your purpose as a brand.” As an example, he cited the way PepsiCo’s Dorito’s corn-chip brand supported racial justice and the Black Lives Matter movement. The support has included a $5 million ad campaign in 2021 called Solid Black, developed to amplify Black cultural voices.
Brieane Olson, president of Pacific Sunwear of California, LLC, better known as PacSun, talked about the apparel retailer’s entry into the metaverse — a broad term referring to a network of 3D virtual online “worlds.” She said the retailer’s customers, most of whom are part of Gen Z, led the company into the virtual realms. Last year, PacSun (No. 599) developed a presence on the gaming platform Roblox. Roblox users can go to the Roblox Avatar Marketplace and use Robux (a virtual in-game currency) to customize their Avatars with PacSun-branded clothing and fashion accessories. Among PacSun’s most popular virtual products on Roblox is a set of gold wings.
- ShoppingGives, an ecommerce platform designed to create relationships between brands and nonprofits, announced a partnership with hair-care brand Olaplex. The brand will use ShoppingGives’ technology to feature six nonprofits benefiting women on its website. The nonprofit beneficiaries are Women for Women International, Girls Who Code, Step Up, Girls Inc., Black Girls CODE, and She’s the First. Customers will get the chance to select which one they’d like a portion of their purchases to support.
- Uber Technologies Inc. announced an agreement to deliver from BP PLC convenience-store locations. The deal extends existing local arrangements to reach more consumers across the world. Uber Eats will deliver products, including a range of products tailored to local markets. Selections which may include hot and cold drinks, prepared food, staple groceries, plus wine, beer and flowers. BP is the first convenience-store chain to work with Uber Eats on a global level, the companies said. BP said it wants to have more than 3,000 retail locations available on the delivery platform over the next three years.
- The Only Bean, a plant-based food company that creates food products using beans, launched a new crunchy, roasted “super snack” made from edamame beans. The Only Bean products are currently available on Amazon.com, Walmart.com, Kroger.com. Meijer Inc. stores will begin carrying them in the upcoming months, Only Bean says.
Bloomberg News contributed to this report.