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GABRIELLA BOCK | Director of Editorial & Industry Relations at RETHINK Retail

Gen Z, Social Commerce and Frictionless Tech Steal the Show at Shoptalk 2023 

Retail was center stage this week as industry leaders from more than 60 countries traveled to Las Vegas, Nevada to attend Shoptalk’s best-attended event yet. 

This year’s production theme was The Stage of Retail, which was presented through a spectacle of stage-framing velveteen and theatrics that ushered curious conference goers from session to session over the course of four days.  It was a fitting theme for the event repertory, which largely focused on building fan-brand relationships, seamless technology, and driving profitability through the power of customer analytics and data insights. 

RETHINK Retail was onsite covering the buzz from inside the session rooms and across the expo floor, and we’re here to deliver the scoop on the trends set to define the decade to come. 

Generation Z has entered the chat: 

Gen Z was having a main character moment at Shoptalk this year, and executives from TikTok, Tarte Cosmetics, and SHEIN showed up in full force to deepen the discussion around how to make nice with this notoriously techy yet skeptical consumer group. The answer was revealed to us throughout our conversations with numerous retailers, which were centered around authenticity, impact and cultivating personal connections with consumers via branded social communities.  And if anyone understands how authentic interactions can capture the hearts and wallets of retail’s youngest consumer group it’s TikTok’s Matt Cleary. 

During an interview with RETHINK Retail, Cleary, who leads the platform’s retail and e-commerce solutions for the U.S. market, shared his insights into how trends attributed to Gen Z are starting to emerge as not just nice-to-haves, but rather as vital practices. 

“There is a behavior that we’ve seen [emerging], which is community commerce,” Cleary revealed. “[On TikTok], you’re discovering products and you’re seeing them from creators that you like and trust because they look like you and share similar interests.”

One of the most critical ways TikTok has impacted the retail market is through its ability to connect users to content that is authentically produced. Unlike other social media platforms that prioritize highly curated and edited content, TikTok encourages users to create content that is raw and unpolished. This approach has resonated with younger consumers who are disillusioned by traditional advertising and seeking out brands that are genuine and relatable. 

“We’ve done studies that show that 71% of our users say that attributes tied to a creator’s authenticity are actually the reasons that they’re motivated to buy from a brand,” Cleary noted. 

Of course, building an authentic brand is not easy. It requires a deep understanding of your audience and a willingness to be vulnerable and honest about your company’s strengths and weaknesses. But for brands that are willing to put in the work, the rewards can be significant.

It’s a payoff Maureen Kelly, founder and CEO of Tarte Cosmetics, knows a lot about.

Although the company has been around for more than two decades, Tarte Cosmetics continues to remain relevant among Gen Zers, even outpacing other digitally-born beauty brands despite being old enough to recall the days when makeup was applied with fingertips and stick sponges. So what’s Tarte’s secret? 

“Everyone’s like, what’s that special secret sauce — here it is: be authentic in everything you do, and you’ll see the results in your bottom line,” Kelly revealed. 

And for Tarte, that bottom line falls somewhere between $50 -$150 million in annual revenue. 

The success of Tarte demonstrates that authenticity is not just a buzzword, but a powerful tool for building brand loyalty among Gen Z consumers. Not only does the brand not pay for traditional advertising—instead relying heavily on user-generated content from its community of loyal fans—the company is also branded around the social causes that lie closest to the founder’s heart. Such causes include investing in local teachers and women-owned businesses, in addition to using naturally-derived and cruelty-free ingredients, which has been a central element of Tarte’s brand since day one. By being true to their values and connecting with consumers on a personal level, Tarte has cultivated a sense of community that stretches far beyond just selling products. 

Another brand that rose to prominence via TikTok is digital heavy-hitter SHEIN. Although the international apparel retailer has been around since 2008, SHEIN erupted into the U.S. market during the COVID-19 pandemic when shopping-starved consumers were left alone with their own devices. With its rapid-fire rollout of trendy and affordable fashionwear,  #SHEINHaul became an overnight sensation on TikTok, with thousands of creators sharing their try-on hauls for the world to see. 

By 2022, SHEIN surpassed its core competitors, namely Forever 21, H&M and Zara, earning the largest share of fast-fashion sales in the United States. And although SHEIN has faced some criticism for its contribution to a culture of wastefulness, others argue that the brand has made fashion for all shapes, sizes and bank statements more accessible than ever before. 

SHEIN is also aware of its position in the market, which is something Peter Pernot-Day, the brand’s Global Head of Strategy and Corporate Affairs, says the company is addressing. 

“Our leadership team’s vision is to promote circularity and we found that one avenue to do that is secondary resale,” Pernot-Day told RETHINK Retail during an interview. “In 2022, we launched something called the SHEIN Exchange where customers who have purchased SHEIN clothing can resell [their garments] to other SHEIN customers.

What we’re trying to promote is the concept of circularity in our garments—we think that’s a key element to solving some of the long-term challenges that we all face as citizens.” 

Everything, everywhere, all at once 

Generation Z wasn’t the only topic of discussion at Shoptalk 2023—and as it turns out, their older counterparts are becoming just as reliant on convenient, tech-driven transaction, fulfillment and delivery options as they are. Gracing the stage at this year’s event was a slew of technology startups pitching their solutions to a panel of judges and an audience of curious onlookers—the winners earning the titles of Judges’ Choice and Audience Choice.  Shoptalk’s Shark Tank-inspired production hosted innovative contenders such as Hark, Factored Quality, Tolstoy and Wink but the main accolades went to two tech providers focused on reducing friction in the areas where consumers are most impacted: purchase and stockouts. 

The Judges’ Choice Award went to Drop, a headless commerce solution that enables brands to sell their products directly to consumers through their social media DMs—making the journey from inspiration to order confirmation easier than ever before. The process works as follows: when a customer sends a message to a brand’s social media account expressing interest in a particular product, the brand’s chatbot responds with a product recommendation or a link to the product page. The customer can then add the item to their cart, enter their payment and shipping information, and complete their purchase—all within the chat interface.

Drop’s win at Shoptalk further exemplifies the industry’s shift toward social-based commerce and the demand for brands to create custom shopping experiences that align with their core identity and messaging. And for retailer’s, Drop’s infrastructure reduces the complexity of managing multiple storefronts and back-end systems, which can be costly and time-consuming.

The Audience Choice Award went to Syrup, an AI-powered inventory planning and optimization platform that empowers merchandising teams to make informed, data-driven inventory management decisions with predictive analytics. In that audience was Kieran Powell, EVP of Channel V Media, who told RETHINK Retail he believed the audience made the right call in selecting Syrup. Powell noted that retail, which used to be top-down, has shifted into a landscape where consumers are deciding what other consumers should buy and from which stores.

“Technologies that help retailers predict inventory and supply chain needs in an unpredictable market are particularly interesting right now,” Powell said. “This is especially true considering that established retail brands, who have been around awhile, have seen a massive shift in their ability to influence consumer demand.” 

According to Powell, Syrup, which uses AI and predictive analytics to inform demand, emulates the sort of ‘right-now’ innovation retailers should be focusing on. 

“Syrup enables retailers to make better decisions about their inventory, resulting in preserved margins, reduced overstock and keeping excess inventory out of landfills,” he said. “And with these challenges currently on every retailer’s mind, Syrup’s capabilities couldn’t come at a better time.”

Back at the RETHINK Retail Booth, seamless transactions and product demand were also on the mind of Dimple Rao. Rao, who heads digital product management and experience design for Chico’s FAS, told RETHINK Retail that her customers—who historically place in the 45-and-over market— are also expecting trend-forecasted products and experiences that move fluidly across their channels. 

“Our customer’s expectations are changing rapidly, and so instead of trying to predict what she’s going to want in three, we want to have a platform that can pivot as we learn more,” Rao said. “We want to keep lockstep with her—maybe one step ahead—but that’s the synergy we’re trying to build.” 

Curtain call

Our time at Shoptalk 2023 revealed just how powerful social commerce and AI-driven technology are at driving transformation in the retail industry. These tools enable retailers to personalize the shopping experience, optimize inventory levels, and engage with customers in authentic and meaningful ways—all functions that are now fundamental to smart retailing. However, it’s important to note that technology is not a panacea for all retail challenges and sometimes tech for the sake of being techy can leave audiences feeling disconnected from the overall experience. 

Just as a play has a central theme that ties everything together, retailers should have a clear and compelling brand message that resonates with their target audience. As with actors who are tasked with delivering a compelling and engaging performance, sales associates must make passionate moves to deliver exceptional customer service. 

And just as a great performance leaves a lasting impression on an audience, a great retail experience leaves a lasting impression on the customer—and when customers are now watching closely from every channel out there, well, in the word’s of Shakespeare himself: all the world’s a stage.