Slow summer sales, phone launches and new online protections

0:00Darren McCaffrey:Welcome to Business Live on this Friday with me, Darren McCaffrey. Disappointing retail sales have pointed to a sharp slowdown in the economy. Despite a strong start to the year, retail sales rose by just 0.9 % over the second quarter of 2025 after economists polled by Reuters had forecast a rise of 1.2%. Retail sales contributed only 0.01 % to our GDP, despite June having been England's warmest on record, according to the Met Office. Well, let's speak to Deanne Evans, Europe Management Director at the e-commerce platform Spotify. Very good morning to you. Just on those figures that we were talking about there, Deanne, things are reasonably tough out there, aren't they, for retailers?

0:49Darren McCaffrey:Why do you think that is?

0:51Deann Evans:Look, I think that the June figures will be, you know, Welcome news for some retailers because we did see a slight increase after a decrease in May. And there are a few areas where we are seeing some bright shoots in areas for retailers to take advantage of and really try to drive to drive sales across across the board. And so there are, of course, macroeconomic factors that are happening. There are, you know, there are consumer confidence indexes that are down. But we are seeing areas like warm weather driven products like insect repellents, evaporator coolers, things like that, where consumers are spending and we're seeing triple digit growth.

1:28Deann Evans:And at Shopify, we drive we drive in-store commerce and online operations for millions of merchants across the globe. Some here in the UK, like Bowdoin, Gymshark, where we are helping to support their in-commerce and retail operations.

1:43Darren McCaffrey:Yeah, as you say, often in the good weather, things like barbecues also do well, don't they? And people get out and buy. What influence, by the way, does the weather have on sales? Earlier this year, I was told that actually the good weather means that people buy fewer things online. They tend to go out to the shops more. And yet these recent figures seem to suggest almost the opposite. Maybe the weather doesn't have as much effect as we think it does.

2:10Deann Evans:Well, we did see, as I said, we saw an increase from the weather and some of these products that are warm weather focused. But what we really do see is that from both an in-store and online perspective, consumers want to shop everywhere. So it's really this retail everywhere mindset that retailers need to have. They need to be available to consumers wherever they're shopping, whatever channels that might be. And businesses like Shopify help support that.

2:33Darren McCaffrey:We're also told, though, that actually confidence in the economy, in UK households, it's pretty low. It's lower than it was essentially this time last year. Have you found that? And how does that compare elsewhere in Europe?

2:49Deann Evans:So if we think about consumer confidence, we are seeing that it is going down. But again, if retailers implement a strategy where they think about things like we talked about weather being one, another might be cultural moments. So we're seeing retailers that take advantage of cultural moments. For instance, Wimbledon, right? We did see a year-over-year increase in sales of tennis rackets. I think it was 62 % for tennis balls and something a bit smaller for tennis rackets. But we're seeing an increase when retailers really develop a strategy around things like cultural moments. I'll use Oasis as an example.

3:20Deann Evans:So we just talked a bit about warm weather driving sales for products around that. But we also saw an increase in parkas by over 200 % parka sales, driven by, obviously, Gallagher fever. And so retailers need to think about things like that and ways that they can drive different ways to take advantage of cultural moments. On the flip side, like you said, from the consumer confidence perspective, we do see that UK consumers are shopping for discounts, right? 83 % saying that they're looking for a discount in price comparison shopping. And so this is something that we need to think about when you're a retailer developing your strategy.

3:56Deann Evans:How do you develop your discounting strategy, but maybe tie it to an overall loyalty program. So you're thinking more strategically about how you drive sales.

4:03Darren McCaffrey:Okay. And just very, very briefly, if you can, Deanne, just on terms of AI, we talk about this every day, but I'm sure it is changing your business quite significantly.

4:13Deann Evans:Yeah, we're really excited about AI from a discovery and search perspective. This is going to be another channel that consumers are going to be able to use to really go out and find products to find new retailers. And so it's something that it's a great opportunity. Indeed.

4:26Darren McCaffrey:OK. Deanne Evans from Shopify, thank you very much indeed for joining us live from central London. Thank you. Thank you. Let's bring it up to some of the rest of the business stories this morning. And British households are prioritising saving money over spending more. Talked about that, didn't we, during the last interview there. That's according to Consumer Confidence Survey. Neil Bellamy, Consumer Insights Director at GFK, found people are saving more than at any point since the global financial crisis and said some people may be sensing stormy conditions ahead as the Chancellor prepares to raise taxes in the autumn budget.

5:01Darren McCaffrey:The media regulator in the United States has approved an$8 billion merger between Paramount Global and Skydance. The approval comes weeks after Paramount agreed to pay$16 million to settle a lawsuit with US President Donald Trump against CBS. And the NatWest Group gas raised its guidance for the year and announced a£750 million buyback after its second quarter earnings beat analyst estimates. Net interest income for the period came in at£3.1 billion, broadly in line with estimates, while pre-tax income rose 4.4 % on a year ago to£1.8 billion. The bank also announced a£9.5 per share interim dividend.

5:43Darren McCaffrey:And you can get more on that story and, indeed, more on our money blog. Just scan that QR code, the big one in the middle of your screen. right now to access the Sky News app.

5:59Darren McCaffrey:We love a QR code. Now, a senior executive at Samsung has told Sky News the Korean tech firm wants to keep more people out of hospital by nudging them to eat a few more vegetables and do healthier things than they would have previously done in a bar. The government's gone with Samsung's new line-up of folding phones and smartwatches ship today. Well, earlier I spoke to Samsung's Anika Bison, Vice President of Product and Marketing, by asking her what's different about this new line of devices.

6:33Annika Bizon:Do you know what's super exciting? Samsung are known for being innovators. And what we have done in this launch is basically create foldable phones. And what are foldable phones? They're basically everything you expect you'd get on a standard bar-type phone. brilliant camera, amazing processor, but we've also taken that to the next level. So you can open the phone and it becomes a full screen. And what you can do with that is you can watch content. You know, I watch, I travel a lot. I watch a lot of content on there. You can multitask, but it then folds neatly back into being a small package phone that you can fit into your pocket.

7:12Darren McCaffrey:Is this what customers wanted in the sense that, is it just about the size? Why have it foldable?

7:20Annika Bizon:We bring phones for everybody, right? And some people want to have the most innovative, most beautiful version of a phone, but they also want the basics that come with every phone that they'd expect from us. So that's, as I said, great battery, great camera, all of those things. But they want something different. They want to be able to not maybe carry a tablet around with them. They just want to be able to have everything in one package. And this gives them that.

7:43Darren McCaffrey:Other things that are changing of course are kind of wearable technology We know there's a lot of focus on and a lot of innovation going into essentially wearable technology And that includes kind of monitoring our sleep Which seems to be this thing that everyone is slightly obsessive about at the moment

7:58Annika Bizon:I think the days of if you go back to my generation, it's like you sleep and you're dead You know everybody was work hard, play hard, keep going And now we're seeing a new stage of how people monitor and look at their health and that's down to, do you know what, you need to understand what's the right sleep for you. And so we're giving through our new smartwatches that are launching this week, Galaxy Watch 8, it's all about giving people the ability through AI and advanced sensor technology to understand what's the right sleep pattern for you because sleep is the cornerstone of everything, whether that be your mental health, your physical health, or in fact, you know, how you socially interact and your work performance.

8:37Annika Bizon:All of those things are linked through sleep. So we're passionate about making sure that everybody gets the best night's sleep they can.

8:43Darren McCaffrey:And there is this connection, I always know, between AI and your kind of technological devices that you have with you all the time and your health. And this is something that now the government are interested in as well and health and medical professionals.

8:57Annika Bizon:100 % because Samsung with the new Galaxy Watch 8 are going into preventative health. and preventative health is giving you the tools that understand basically how you can stop yourself from going to hospital. Things like, let me explain a few of them, an antioxidant index. What does that mean? That means through a sensor and through AI, we can look at and understand how many healthy vegetables are in your system. So how many carotenoids are in your system? And that can give you a really clear indicator of actually I'm a bit low, I need to eat more vegetables or alongside that something like measuring your vascular load your vascular load is all of the healthy blood vessels that healthy blood that's running around your system through that gets rid of brings oxygen gets rid of waste and gives you a really clear indicator of heart

9:49Darren McCaffrey:health is there a concern though that and there has been a concern really since this technology came to play and we could access kind of answers that we were monitoring we could monitor each other a bit too much that you kind of people get too into i mean i read recently that people were waking up in the middle of the sleep checking the fact that they were sleeping well sleep maximizes yeah you see what i mean though is in like there's almost too much information no i think i think

10:12Annika Bizon:there's a few things one is isn't it incredible that people are looking at their health in this much detail because we want to keep people out of hospitals we want people to live healthier lives and and there's an awareness around that that's never been before you know we can see that 59 increase in running clubs because people want to spend more time doing healthy things than they would have done in a bar in the past. However, what we're doing is giving people the tools to monitor their health their way. And that's a really important differentiator. You know, it's understanding and looking at, you know, I don't want to keep people, I want to make sure as many people aren't in hospitals, because we've given them those gentle nudges on the way to say, maybe a few more vegetables, maybe your sleep pattern isn't as it should be.

10:54Annika Bizon:Fads are one thing. We're here for the long term and we're here to make sure that people understand their health throughout their life. The sleep I needed when I was 20 to the sleep I need now and itself, very different.

11:06Darren McCaffrey:Let's just talk about phones themselves and this technology. You know, there's quite complex supply chains often involved in lots of different parts of the world. We're through a period of turmoil at the moment, not least of all because of Donald Trump in the White House. What's your sense of the challenges that Samsung, the industry faces in terms of trying to effectively still make those supply chains work with that uncertainty?

11:31Annika Bizon:I think when you look at, we're a global business. We're always bringing products to market across the world and managing fluctuations on a number of levels. We look at this really closely. We monitor it really closely. But most importantly to us is making sure that the demand we're seeing, particularly with some of our premium phones and wearables, that we've got the products there in consumers' hands.

11:51Darren McCaffrey:And just very finally on this then, what next? Because we call these things phones. Yeah, 90 % of the time we don't use them to actually call anyone. In fact, if you listen to young people, that's even less and less. So what is next? I mean, is the phone still the bedrock of what we call a phone? Or, I mean, what's the next innovation? I know other people are looking at a third device, for example, or a different device that they might well interact with in the future.

12:16Annika Bizon:I think what you're seeing is a really exciting time where you're seeing AI technology through things like generative AI, being able to take a photo and move not just one thing from the background, but move a number of things out of the background or audio arrays. They're being able to take a noise out of a video you've taken. We're seeing that companionship through AI and how it can give you tweaks in your life to take away the mundane as well to make your life easier really come to fruition. And that's going to be really exciting over the next 12 months. alongside what we've just launched in it, incredible form factors, better quality products than you've ever seen before, that are thinner, lighter, and work with your life.

12:59Darren McCaffrey:Now, some of the strictest rules in the world for age verification have come into force in the UK. Starting today, adults who try to access pornography will be required to prove they are over the age of 18. Well, let's speak to Andy Lullan. He is the Chief Operating Officer at Verify My, who do age verification checks for Google and adult sites and others. Andy, very good morning to you. Just first of all, how does this work? Is it a bit like when you apply to set up a bank account online? Is that the kind of thing we're talking about here?

13:31Andy Lulham:So Ofcom have listed seven methods as being capable of being highly effective. And we at Verify My offer five of them. But it's important to reiterate that this is age assurance or age verification, where a user simply has to anonymously prove if they are over 18. It is not, as you say, a requirement for everyone to disclose their identity to the adult platform, which they might typically have to do if they were creating a bank account or a gambling account, for example.

13:57Darren McCaffrey:So how do you do that without giving away who you are? That sounds rather odd.

14:02Andy Lulham:So there are different methods that are available to you. Yes, you can choose to do an identity document scan with a face match, but you can also choose to prove your age just by using your email address for example or a facial age estimation check it is as simple as that and that data is provided to the age assurance providers such as verify my but importantly the only thing that then gets passed onto the adult platform is a binary yes or no as to whether that individual is over 18 or not

14:29Darren McCaffrey:but my word we live in an age don't we in which everyone's concerned about hacking we've seen a lot of that this year. How can you guarantee to people that the data that you hold on them will not be hacked and end up in the hands of people who might want to use it nefariously? Well,

14:48Andy Lulham:it's a really good question and it's really relevant. The first thing to say is that we only collect the minimum amount of data that is required to complete the AIDS check. It is only used for the purposes of AIDS verification and it is deleted as soon as the AIDS verification check has been completed. So notwithstanding that, when we do hold data, it is stored at the highest possible encryption level. So for example, if you're doing an email-based check, it would be no different than using your email address to log on with a password at any site online.

15:22Darren McCaffrey:What about VPNs? Lots of people say, you know, that's the easy way around all of this.

15:27Andy Lulham:So some similar legislation in other parts of the world has seen an increase in the use of VPNs, But according to Ofcom, the regulator for this legislation, platforms that encourage the use of VPNs to get around age checks will be investigated. And my understanding is that VPNs absolutely do not remove the responsibility for platforms to prevent children from accessing their sites. Some VPNs these days can also be detected by certain types of technology.

15:52Darren McCaffrey:OK, it's fascinating. And we will see how it all works out for those companies. Andy, we really appreciate your time this morning from Verify My. Thank you very much indeed. There's more business news and analysis on the Sky News app, but that's all from today's Sky News Business Podcast. You can follow the feed on Apple or Spotify or wherever you get your podcasts. Thanks for listening. Evening. Buyer's remorse. Buy a new car? I'll be moving in. Let's get started.