Inside retail's new obsession: Where should the AI shopping assistant live?

Happy Wednesday.

I’ll skip the basketball-related anecdotes this time, but I will just say for those who follow the NBA: Knicks in 6.

Beyond that, a couple of news items stuck out to me this week.

First, Scrunch, the AEO/GEO startup whose CEO Chris Andrew spoke to The Aisle for last week’s newsletter, announced it was being acquired by Sitecore for a reported $225 million. I’m not going to say being quoted in The Aisle is going to get you acquired overnight, but I’m not going to not say that either.

In all seriousness, when Andrew and I spoke recently, he reflected back on his prior decade-plus stint at the social media marketing firm Hearsay and admitted that the startup probably should have sold much sooner than it eventually did. With that in mind, I’d be surprised if that personal history didn’t play at least some role in the thinking this time around, especially in a category as crowded and noisy as the one Scrunch is currently battling in. I asked Hunter Walk, an investor in Scrunch through his VC firm Homebrew, and a friend of The Aisle, for his thoughts on the deal.

“For founders, crowded markets can be like playing musical chairs in a dark room - you don’t know how many chairs are out there or how long the song lasts,” he wrote in a text to me. “Sitecore had a great vision for what a combined company could look like and we were happy to support the Scrunch founders in making it a reality. It was a success for both the org chart and cap table.”

Second, a new study from Horizon Media, an agency that plans and buys advertising campaigns for brands, puts some numbers around a concern that could keep AI shopping execs up at night: consumer trust. The firm surveyed 1,000 consumers who regularly use AI tools and found that 68 percent believe an AI shopping agent may not be acting in their best interests, and that when automated purchases go wrong, which happens roughly 40 percent of the time by their measure, brand loyalty takes a direct hit; what Horizon calls a "Trust Tax."

One caveat worth noting: despite the strictest interpretations of "agentic commerce," most of what retailers and consumer brands are actually deploying today are AI assistants built for discovery and recommendations, not autonomous purchasing. Truly automated buying at scale is still largely just Amazon's game, and even there it remains experimental, which means the trust concerns Horizon is measuring feel like they are getting ahead of where the industry actually is.

Lastly, I’ll be in Aspen the first half of next week co-hosting Fortune’s legendary annual tech confab, Brainstorm Tech, so next week’s edition may land in your inbox a day or two later than usual. If you’re attending this year’s event, please find me. And if you’d like to go, message me and I’ll try to still help make it happen.

Now on to the good stuff below, with insights from and about Amazon, Lowe’s, Bloomreach, Home Depot, Remark, and Forrester…

For years, the customer service chatbot has lived in the bottom right corner of many websites, making it easy to find but also easy to ignore if you, like me, ever became disenchanted by how bad the experience often was. And when those chat boxes would pop up in extra annoying ways, I would smash the X button faster than my kids inhale a Shake Shack shake.

But now that AI shopping assistants are here and actually offering some value, that inherited default placement is worth revisiting. And as major retailers and brands big and small race to deploy AI shopping assistants, and tech players build the infrastructure to power them, a question that sounds trivially tactical could end up mattering a lot: where on a site does an AI assistant actually belong?

To find out, I spoke with executives at Lowe’s, startup founders, industry veterans, and analysts.

First, Remark, a startup that builds AI shopping assistant technology that’s trained on the expertise of humans, shared with me a breakdown of conversion rates across roughly half a million shopper conversations spanning about 100 merchants.