Everyone wants to talk about what AI will do next. But this month's newsletter is more interested in what has to happen first. Chili's retired its serving robots while prioritizing fixes to Wi-Fi problems, Target built a digital twin instead of guessing, and retailers are upgrading their scanning systems ahead of a 2027 deadline. Add in some research about a more hesitant economy and 35 years of payments wisdom from Kitestring's own Tim Webb, and you've got our August newsletter. Let's get into it!

Baby Back Ribs & Big Back-End Upgrades

Chili's has spent the past two years fixing the unglamorous basics by rebuilding network infrastructure across its 1,200-plus locations, rolling out roughly 9,000 upgraded kitchen display screens, 1,200 new laptops and 23,000 new iPads into stores. CIO Chris Caldwell has also pulled the plug on flashier initiatives, including retiring the chain's serving robots, and has been selective about which GenAI use cases they move forward with. The investments have coincided with, and, according to Caldwell, contributed to, a broader turnaround that includes 20 consecutive quarters of same-store sales growth and higher guest satisfaction.

Our View: We love what Chili's is doing here. It's exactly the philosophy we preach at Kitestring: fix the foundation before you chase the shiny stuff. Chili's has the right mindset, focusing first on modernizing its store infrastructure. A strong edge platform, reliable Wi-Fi connectivity, and in-store technology like new tablets and laptops create the stability needed to support today's operations while making it much easier to introduce AI, automation, and other advanced capabilities over time. Retailers that invest in the foundation first will be in a much better position to realize the full value of AI, instead of struggling to make it work on outdated infrastructure.

Take a closer look →

QR You Kidding Me?

Project Sunrise 2027, GS1's global push to move retail point-of-sale systems from traditional 1D barcodes to data-rich 2D barcodes like QR codes and GS1 DataMatrix, is picking up steam for food, grocery, and beauty brands. Unlike a standard UPC, which mostly identifies a product type, 2D barcodes can carry extended information such as lot numbers, expiration dates, and serialization data directly at the point of sale. For food and beauty brands in particular, this opens the door to sharper traceability, ingredient transparency, and consumer-facing digital experiences. Brands are currently adding 2D barcodes alongside existing 1D barcodes as retailers upgrade their POS systems ahead of the 2027 milestone.

Expert POV from Eugene Park: The Taylor Farms iceberg lettuce recall illustrates the value of more granular traceability. GS1 Application Identifiers, the codes embedded in these 2D barcodes for things like batch or lot number and production date, can help brands and retailers narrow a recall to the affected lot instead of pulling product chain-wide. With Sunrise 2027 arriving next year, grocers need this infrastructure in place well before the next outbreak hits.

Learn more →

Welcome to the Hesitation Economy

This article argues that brand loyalty can no longer be treated as a permanent state in what it calls the "hesitation economy," a market where activity continues but consumer confidence stays uncertain and reactive. Nearly 60% of consumers now report switching brands not out of dissatisfaction but in search of better timing, pricing, or promotions. The shift is most pronounced among younger shoppers: 50% of Gen Z shoppers now want two or more days of "in-cart dwell time" before completing a purchase, compared with just 25% of Baby Boomers, meaning the research window before a sale has stretched out considerably.

Our Take: This article takes a deep dive on how the current state of the U.S. economy is altering customer habits and brand preferences. This brings new challenges for retailers. Data channels need to be up to date at all times and talking with each other. Your app or online store needs to show what's available for choosing, yes, but it also needs to keep up with the contents of your customer's basket. Loyalty systems must use the extra data points, like decision time, basket life, and current events, to give customers the best value for their time. The time a customer spends shopping and browsing matters for a reason, and if you can't keep up with that pace, you may lose more than the sale.

Read More →

Podcast Pick: Behind the Counter with Tim Webb

In this episode of Behind the Counter, host Vicente Yañez sits down with Tim Webb, Principal Architect at Kitestring Technical Services, to unpack what 35+ years at the center of retail technology teaches you about payments, innovation, and building architecture that actually lasts. Tim traces the evolution of payments from knuckle busters to mobile wallets. He also makes the case for why payment fees may now be competing with labor as a retailer's biggest expense, digs into the patents he's filed out of pure frustration, argues that POS should eventually become invisible, and shares what it really takes to build a culture of innovation that sticks.

Listen while you work →

AI, Take the Cart

A new survey of over 1,800 consumers across the U.S., U.K., Japan, and France found that shoppers are increasingly trusting AI tools to shop for them, though not without guardrails. 68% said they'd used an AI platform to shop in the past three months, and 44% now trust AI tools when making purchase decisions, edging out influencers and traditional media. Younger shoppers are especially open to letting AI take the wheel with 42% of American millennials saying they'd let an AI agent buy items for them within a $250 budget if they had a seven-day return window. Still, over a third of respondents across generations said they'd want a human to review a transaction before an AI agent completes it, a number that jumps to 44% among baby boomers.

Expert Take from Jason Todd: I co-wrote a mentoring book once, and one of the chapters was called "surfing the chaos." A little chaos can be an opportunity and a change agent for good, and agentic shopping is going to cause some chaos. But inside that chaos will be real, tangible opportunities that could significantly change the face of retail. I'd take a hard look at your foundational systems ahead of it. How flexible and agile are your systems? Your processes? Your payment rails?

Get more insight →

Target’s Not So Evil Twin, Proxima

Target has built an in-house tool called Proxima, a digital twin of its middle-mile inventory positioning system that simulates how inventory decisions will play out before teams commit to them. In a small pilot, Proxima caught problems that lifted on-shelf availability of fresh food products, and it was used to validate the inventory flow of Target's new 1.2 million-square-foot Houston Receive Center with roughly 98% accuracy before the facility opened. Target plans to scale Proxima across more network functions, and says its insights could eventually feed AI-powered, agentic decision-support capabilities.

Kitestring’s POV: Back in October’s newsletter, we highlighted Target's disciplined approach to technology. They rebuild the foundation first, then layer on innovation. Proxima is proof of that discipline in action. Another takeaway is how transferable that discipline is. The same idea can apply directly to POS system migrations. Instead of flipping a store to new checkout software and hoping it works, retailers can take a real day (or a full quarter to cover seasonal edge cases) of past transaction data and replay it through the new system before a single register goes live, testing tender splits, returns, discounts, and gift card redemptions the same way Target tested inventory moves. This catches the failure mode that actually causes damage. For example, the new POS handles a normal sale just fine, but gets a split-tender return with a loyalty redemption wrong. Just as Target used Proxima to test complex fresh-food inventory scenarios, POS teams should stress-test their ugliest transaction combinations first.

Dive in →

Nobody's Aced the AI Test Yet

At NRF Nexus 2026, senior retail technology leaders gathered to talk candidly about where AI is creating value and where it isn't. Speakers pushed the group to focus less on where AI could be applied and more on the intended business outcome first. Much of the discussion centered on the human side of transformation and the importance of building a culture that can actually absorb the change.

Our Perspective: This article gets it right when it says the AI playbook is still being written. Every retailer should be asking what their next move is. Lead, and you accept more risk for the chance to differentiate. Follow, and you reduce risk but may give up first-mover advantage. Most companies will follow, so the real difference is whether they're prepared when the opportunity arrives, which means preparing now. When you're investing in a new POS, payments, loyalty, inventory, ecommerce, or pricing platform, don't just replace what you have. Define your target-state architecture, your data strategy, and a phased migration plan. Every decision should move you closer to a unified commerce platform that can support agentic shopping and whatever comes next.

Keep Reading →

Thanks for Reading!

August’s newsletter shows that the ‘boring’ stuff is having a moment. Strong Wi-Fi, upgraded barcodes, and digital twins can create more immediate value than a flashy AI rollout. The playbook for what comes next is still being written, but the retailers laying the ‘boring’ groundwork now will be the ones set up to succeed. We'll be back in September with more.

Enjoyed this issue? Forward it to a colleague and share the insights!