Holiday 🇺🇸 edition of Tasty AI and Agentic Commerce Reads!
Cloudflare wants to 💰 the bots, Meta hints at Agentic Commerce, and 3 Essays Perfect for some long Holiday weekend deep thoughts.
Cloudflare Part 1: Background (Shot…)
Way back at Cannes on June 19th, Cloudflare CEO Matthew Prince, dropped some crazy data at an Axios event about human vs. bot traffic online best summarized in this table.
I’ll take Google because that’s the one retailers probably care about the most. Six months ago, for every 8 pages a google bot visited, 1 visitor returned. That is now 18:1 - 18 Googlebots, 1 human delivered.
In 1:1 conversations I’m having with brands and retailers, they are seeing this in the data - there is a surge in non-human traffic and a flat/~10% decline in human traffic. As Answer Engines become prevalent at a high-level, this trend will continue and even accelerate.
That brings us to part 2:
Cloudflare Part 2: Bot/Agent Monetization Pay-Per-Crawl?!(and Chaser)
On July 1, as teased in the Axios interview, Cloudflare announced a system that blocks bots, asks for their intent (training, inference or search) and allows the site owner (publisher) to block any combo of the three. You can also require compensation.
My $.02 on this and the world of Agentic Commerce is it’s not for Retail/Brands. While there is Retail Media networks, the overwhelming majority of revenue and margin comes from selling products. If you block training or inference or search, and a user is researching products, you’ve taken yourself out of the game completely. Product information is meant to be disseminated as widely as possible to cast a net to bring in shoppers.
That being said, there are going to be some brands and retailers that absolutely do not want to participate in the Agentic future and perhaps Cloudflare will figure out how to give them that option.
Web data extraction/crawling arms race kicks off
In the Axios interview, the CEO talks about the bot-v-bot nature of what they do and feels like they will win the battle. The trick is going to be the next level in the arms race is going to be in the Browser. When a server request comes in, it’s a lot easier than John+Jane Smith in St. Louis using his Chrome or Perplexity (or OpenAI, or …) browser and that bot goes to amazon (from his computer and his home and all the IP stack in there looks like him using chrome) and does some shopping on his behalf. Now maybe perplexity won’t be able to build a web search index, but if they take all the millions of datapoints from individual sessions, anonymize them and roll that into a web index.
I don’t see Cloudflare of any retailer stopping that. To stop it, you have to monitor each individual session and run this risk of a false positive and blocking good ole’ top customer John+Jane Smith from your checkout. Nope, not going to happen: Checkmate.
Meta Hints at Agentic Commerce in WhatsApp at “Conversations” event.
No, I’m not going to talk about Zuck dropping $100m signing bonuses on building his JLA/Avengers of AI Super Team - I’m kind of burned out on that already.
But, with all that brainpower and clear desire to disrupt the status quote, it’s interesting to note this one. Friend of Retailgentic and awesome Wall St. Analyst Colin Sebastian at Baird has a report out about this “Conversations” event. In the event when talking about WhatsApp, Zuck talked specifically about agents coming in WhatApp and in a list of capabilities that would deliver said they would be able to “facilitate transactions”
Given how much of commerce meta touches, and their desire to lead in AI, it feels obvious that they are going to push hard here. Will we see a big Meta Agentic Commerce push before Holiday 25?
3 Essays on building, marketing and coping in the GenAI/Agentic Future (that’s here now)
These three are kind of thematic and really got me thinking, so perfect to read before a long drive or before you have a walk on the beach. I know most of the readers are from the Retail/Ecommerce world, so I’ll tie these back to our world.
The Great Differentiation (Not Boring)
In this essay, Packy highlights that in an increasingly GenAI world, doing things that are the opposite, different, unique and authentically your brand will increase in value. In our world, that means stores. This is a great time to elevate the store experience to be just that - an experience. Only you can answer the question of what that looks like, but I’ll point you to a piece I’ve mentioned before and gone back to a couple of times as I think about all this - Melina Falabiano’s piece on Creative Commerce substack titled ‘AI is taking over, so what’. She talks about ‘Being offline is the ultimate luxury’, the inversion of discovery and ‘real humans’ as a mark of luxury’. I think she’s onto something there.
The rise of the AI native employee
In my startup and other AI founder circles, this is the default - we have agents on our org chart. Elena came from a traditional org in a growth role, and now has jumped feet first into an AI native company. Her observations are spot on.
My challenge to you - how do you move your org to thinking more AI Native? Is it an edict from the CEO? Is it an experiment? If you could start using some agents vs. employees on your team where would it be (hint: anything that’s moving data around in a workflow/process/inter-dept coord is a good place to look).
Just like when we moved from Analog (Store) to Digital (ecommerce), this is an existential crises. DAINVB (Digitally AI Native Vertical Brands) are sure to be born with 10-20 people doing $100-500m and they will use that lean-advantage to lower prices. Get ready now.
Stop Worrying: 3 AI Reality Gaps and How to be UnLLMable
I know when you read all of these non-stop articles, it’s scary, the good news is there are many reality gaps that once you get deep into AI you realize not only is everything going to be better, but AI gives you and your org superpowers. You can **FINALLY** do the things you always wanted to because you cut through meaningless busy work without a thought. This essay from Every’s Sari Azout does a great job stripping down to the reality and gives practical advice.
Thanks for reading and post July 4th Holiday, we’ll be back with more original content and some killer pods to help navigate you through our Agentic Commerce Journey.
Scot
Happy 4th everyone! 🇺🇸🎇🇺🇸🎆