The landscape of online retail is undergoing a profound transformation as major players increasingly commit to agentic AI-powered commerce. This strategic shift involves leading retailers integrating their product offerings with external artificial intelligence platforms, even as they acknowledge potential compromises concerning customer proximity and data governance.
Early in 2026, companies like Etsy, Target, and Walmart significantly expanded their presence on third-party AI systems, forging new collaborations with Google’s Gemini and Microsoft’s Copilot. These developments follow earlier partnerships with OpenAI’s ChatGPT, enabling customers to complete purchases directly within the AI's conversational interface. Concurrently, giants like Amazon and Walmart are cultivating proprietary consumer-facing AI assistants, Rufus and Sparky, respectively, aiming to redefine customer interactions with their individual brands.
The Disruptive Power of Agentic AI
Industry observers view the rise of agentic AI as a pivotal moment, poised to redraw direct-to-consumer engagement. Kartik Hosanagar, a marketing professor at the Wharton School of the University of Pennsylvania, remarked that this trend holds the potential to disrupt retail in a manner akin to the internet's initial impact. Partnering with sophisticated AIs allows retailers to connect with consumers directly within their chosen digital environments.
Recent data underscores this burgeoning trend. Adobe's 2025 Holiday Shopping report revealed a staggering 758% year-on-year increase in AI-driven traffic to US e-commerce sites in November 2025. Furthermore, Cyber Monday witnessed a 670% surge in retail visits referred by AI. Katherine Black, a partner at Kearney specializing in mass-market retail, anticipates a “deepening of consumer engagement,” predicting greater reliance on AI for diverse purchasing needs as these retail tools mature.
Navigating Trade-offs: Data and Loyalty
However, engaging customers on external AI platforms is not without its complexities, according to market analysts. Significant questions arise regarding data ownership and the risk of retailers being marginalized. A Deloitte 2026 Retail Industry Global Outlook indicated that 81% of retail executives expect generative AI to diminish brand loyalty by 2027.
Typically, a retailer's website or app provides invaluable behavioral data. When customer discovery, evaluation, and purchase occur on an external platform, critical insights may not reach the retailer. Professor Hosanagar highlighted this shift, stating that control over the AI agent increasingly equates to control over the customer relationship. Google and Alphabet CEO Sundar Pichai has outlined new commerce functionalities for Gemini, detailing support from product discovery through to final transaction. Nikki Baird, vice president of strategy and product at Aptos, expressed concerns that this could lead to Google accumulating comprehensive data across these stages, potentially leaving retailers with an incomplete understanding of their clientele, even if some information is shared.
Despite these apprehensions, Pichai has affirmed Google's commitment to collaboration, assuring a National Retail Federation audience that success stems from working together to shape retail's future. Yet, agentic systems offering features like instant checkout could consolidate the entire shopping experience onto a single platform. Hosanagar cautioned that if all research, discovery, and purchasing happen on an external AI, retailers risk compromising their unique brand experience, potentially reducing them to mere fulfillment operations.
Amazon's Independent Path and the Inevitable Shift
Amazon, for its part, has not yet announced plans to sell directly via platforms like ChatGPT, instead doubling down on its internal AI initiatives. The company recently unveiled a dedicated portal for Alexa+, its generative AI assistant designed to aid users in research and purchase planning.
Nevertheless, participation in third-party AI commerce may become an unavoidable reality. When OpenAI launched its Instant Checkout feature for ChatGPT, it hinted that enabling this functionality could influence merchant rankings in search results, alongside factors like price and product quality. Uploading product catalogs to AI chat platforms might represent the initial phase of a widespread transformation in online retail.
Deloitte suggests approximately half of retail executives anticipate the current multi-stage shopping journey converging into a single AI-driven interaction by 2027. The industry remains in the nascent stages of this transition. Hosanagar identifies the true “inflection point” as when consumers empower autonomous agents to shop on their behalf. This scenario means retailers will interact less with human customers and more with their AI representatives. Such agents process information, require data, and respond to persuasion in ways fundamentally distinct from human behavior.
AI Empowering Shoppers and Staff
Today, consumers can access powerful AI tools like ChatGPT on their mobile devices while physically in stores, effectively consulting an ever-present expert. Baird likens this to having “a highly knowledgeable store associate who knows every retailer.” This evolution could prompt retailers to equip their frontline staff with specialized AI tools, providing instant insights into customer preferences or shopping histories. Alternatively, a retailer’s AI agent could proactively alert customers when a favored item is restocked, assisting associates in converting interest into sales. Baird emphasizes that the ultimate objective is to empower store associates to perform optimally.
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Source: AI News
