Baker Retail Rundown

Higher Clothing Prices Are Officially Here

The impact of Donald Trump’s trade war is now being felt at the consumer level, as apparel prices rose 0.4 percent between May and June, the first increase since March, amid a broader inflation spike. This price uptick comes as newly implemented tariffs begin to affect goods hitting U.S. shelves, with more and higher tariffs expected in August for countries without trade deals. Fashion and beauty brands, including Nike, Tapestry, E.l.f., and Glow Recipe, are responding with selective price hikes, while others brace for further increases as pre-tariff inventory runs out. Rising costs across other essentials like gas and electricity could also strain consumer spending, raising concerns that apparel demand will drop despite recent resilience. As inflation persists, the industry is closely watching the upcoming back-to-school season to gauge consumer response.

What a ChatGPT Checkout System Could Mean For Retail

OpenAI is quietly testing a checkout feature within ChatGPT that would let users complete purchases without ever leaving the platform. While the move could streamline online shopping and boost sales, many startup founders worry it signals a shift toward a “pay-to-play” model that favors large retailers with deep pockets. In response, brands like Joe & Bella and Springrose are racing to optimize their product descriptions and web content to ensure ChatGPT accurately surfaces and recommends their offerings. Although some see potential in cutting friction from the customer journey, others are uneasy about losing control over data, messaging, and consumer trust. With few details confirmed by OpenAI, retailers are bracing for what could be a game-changing evolution in AI-driven commerce.

Sephora Taps Lyft To Deliver Customers To Its Stores

Sephora has teamed up with Lyft Media for a four-day promotion called “Delivered to Beauty,” offering $20 Lyft ride credits to select Sephora locations from July 7–10. Shoppers visiting participating stores in NYC, LA, San Francisco, Chicago, and Seattle will receive in-store beauty guidance and $10 off purchases over $50. Unlike typical sales focused on discounts and fast shipping, Sephora is emphasizing the value of in-person, expert-led beauty experiences. Sephora’s CMO highlighted the importance of human connection in beauty shopping, calling the campaign a celebration of the brand’s signature retail experience. This initiative follows years of rapid delivery partnerships across the beauty industry, even as Amazon continues to grow its premium beauty offerings

Hermes Reports 9% Sales Rise But Flags Some Weakness, Shares Down 

Hermès reported a 9% rise in second-quarter sales to €3.9 billion, driven by continued demand for its iconic handbags, though signs of a broader luxury slowdown are emerging. Despite outperforming competitors like Chanel and Louis Vuitton, growth slowed in its fashion, silk, and beauty divisions, causing shares to drop up to 3.9% in early Paris trading. Executive Chairman Axel Dumas noted a dip in demand from first-time customers and confirmed no further price hikes are planned this year after a 7% global increase and an extra 5% in the U.S. to offset tariffs. Hermès's strategy of tightly controlled production and scarcity continues to shield it from industry turbulence, despite global luxury sales facing headwinds, especially in China and the U.S. Still, Dumas expressed confidence in China’s long-term market potential, even as analysts forecast a 2–5% decline in global luxury sales for 2025.