The retail industry is entering a pivotal phase as artificial intelligence moves from behind-the-scenes optimisation into the centre of consumer commerce. Major global retailers are now experimenting with what many analysts describe as “on-AI retail” — selling products directly within AI platforms rather than solely through their own websites or apps.
This shift reflects a broader transformation in how consumers discover, evaluate, and purchase goods. Instead of browsing retailer-owned digital storefronts, shoppers are increasingly turning to conversational AI tools such as ChatGPT, Google Gemini, and Microsoft Copilot to guide buying decisions. For retailers, the opportunity to meet customers where they already are is compelling. But it comes with significant trade-offs around data ownership, brand control, and long-term customer relationships.
As 2026 begins, the pace of experimentation is accelerating, raising fundamental questions about who will own the future of digital commerce: retailers, platforms, or autonomous AI agents acting on behalf of consumers.
Retail’s Move Toward Agentic AI Commerce
In the opening weeks of 2026, several major retailers including Etsy, Target, and Walmart expanded their presence on third-party AI platforms, enabling shoppers to browse and purchase products directly through conversational interfaces. These initiatives build on partnerships formed in 2025 with OpenAI’s ChatGPT and have since extended to Google’s Gemini and Microsoft’s Copilot ecosystems.
The model is simple in concept but profound in implication. Instead of clicking through a retailer’s site, a consumer can ask an AI assistant for recommendations, compare options, and complete a purchase without ever visiting a brand-owned channel. The AI becomes the storefront, the salesperson, and in some cases, the checkout counter.
Retail analysts see this as the early emergence of agentic AI commerce — a system in which autonomous software agents guide or execute purchasing decisions based on consumer intent, preferences, and constraints.
“This has the potential to disrupt retail in the same way the internet once did,” said Kartik Hosanagar, a marketing professor at the Wharton School of the University of Pennsylvania. “When control shifts to the agent, the entire power dynamic of retail changes.”
Why Retailers Are Following Consumers Into AI Platforms
The primary driver behind this shift is consumer behaviour. Shoppers are increasingly comfortable using AI tools for product research, price comparison, and decision-making. According to Adobe’s 2025 Holiday Shopping Report, AI-driven traffic to US e-commerce sites surged 758% year-on-year in November 2025 alone. On Cyber Monday, visits originating from AI tools rose by 670% compared to the previous year.
These figures underscore a growing reality: AI platforms are no longer niche discovery tools. They are becoming mainstream shopping gateways.
Retailers face a stark choice — either integrate with these platforms or risk becoming invisible at the moment of purchase intent. Partnering with AI assistants allows brands to surface products in natural-language conversations, capture demand earlier, and reduce friction in the buying process.
“What we expect is a deepening of consumer engagement,” said Katherine Black, a partner at consulting firm Kearney who specialises in food, drug, and mass-market retail. “As shoppers rely more on AI for purchasing across a wider range of needs, retailers that optimise their presence within these tools will see faster adoption and higher conversion.”
The Strategic Trade-Off: Reach Versus Control
Despite the upside, industry leaders are increasingly vocal about the risks involved. Selling within third-party AI platforms often means giving up direct access to customer data, behavioural insights, and even the brand experience itself.
Retailers have long relied on owned digital channels to collect valuable information about browsing habits, preferences, and purchase history. When discovery, evaluation, and checkout happen entirely within an AI interface, much of that data remains with the platform provider.
“This fundamentally changes where power sits,” Hosanagar noted. “Control over the agent increasingly means control over the customer relationship.”
According to Deloitte’s 2026 Retail Industry Global Outlook, 81% of retail executives believe generative AI will erode brand loyalty by 2027. The concern is not that AI will eliminate brands, but that it will commoditise them — presenting products as interchangeable options optimised for price, availability, and user preferences rather than brand identity.
Google, OpenAI, and the Battle for the AI Commerce Layer
Technology companies are moving quickly to position themselves at the centre of this new commerce model. Google CEO Sundar Pichai recently unveiled new commerce capabilities for Gemini, outlining how the AI can guide users from product discovery through final purchase.
These tools promise seamless shopping experiences, including personalised recommendations, price tracking, and instant checkout. For consumers, the convenience is clear. For retailers, the implications are more complex.
“What’s being described is ownership of the entire commerce funnel,” said Nikki Baird, vice president of strategy and product at retail technology firm Aptos. “Even if some data is shared back to retailers, missing the context of discovery and decision-making leaves them with a much poorer understanding of their customers.”
Pichai has emphasised that collaboration remains central to Google’s approach. Speaking to an audience at the National Retail Federation (NRF), he said the company’s goal is to help retailers succeed rather than replace them.
“From nearly three decades of working with retailers, we know success only comes when we work together,” Pichai said. “Our aim is to use our full technology stack to help shape the next era of retail.”
Amazon and Walmart Take a Different Path
Not all retailers are embracing third-party AI commerce equally. Amazon, for example, has shown little interest in selling products directly through ChatGPT or Gemini. Instead, the company is doubling down on its own AI ecosystem.
Amazon’s consumer-facing AI assistant, Rufus, is designed to help shoppers research products, compare features, and make informed decisions within Amazon’s own environment. The company has also expanded Alexa+, a generative AI upgrade that assists users with planning purchases, creating shopping lists, and managing subscriptions.
Walmart is pursuing a hybrid approach. While experimenting with external AI platforms, it continues to invest heavily in Sparky, its proprietary AI assistant aimed at enhancing both online and in-store shopping experiences.
These strategies reflect a belief that maintaining ownership of the customer relationship remains a competitive advantage, even as AI reshapes how that relationship is mediated.
Instant Checkout and the Risk of Disintermediation
One of the most controversial developments in AI commerce is the introduction of instant checkout features. When OpenAI launched Instant Checkout within ChatGPT in late 2025, it suggested that merchants enabling the feature could gain improved visibility within AI-driven search and recommendation results.
This creates a powerful incentive for retailers to participate — and a potential penalty for those that do not.
“If research, discovery, and purchase all happen on an AI platform rather than a retailer’s site, you’re effectively giving away the brand experience,” Hosanagar warned. “At that point, the retailer risks becoming little more than a fulfilment operation.”
For smaller brands and marketplaces, however, instant checkout may offer access to demand that would otherwise be unreachable. Uploading product catalogues to AI platforms could become the first step in a broader transformation of digital retail infrastructure.
The Coming Shift to Autonomous Shopping Agents
While today’s AI tools still rely heavily on user input, industry observers believe the real disruption will occur when consumers delegate shopping entirely to autonomous agents.
According to Deloitte, nearly half of retail executives expect the current multi-stage shopping journey — search, compare, review, purchase — to collapse into a single AI-driven interaction by 2027.
“The real inflection point is when consumers rely on an autonomous agent to shop on their behalf,” Hosanagar said. “Retailers will engage less with humans directly and more with their representatives — AI agents.”
These agents will evaluate products differently than people do, responding to structured data, availability signals, and algorithmic persuasion rather than emotional branding or visual merchandising. This shift may require retailers to rethink everything from product descriptions to pricing strategies.
AI in the Store: Empowering Associates, Not Replacing Them
The rise of AI-powered shopping does not stop at the digital edge. Consumers already use AI tools on their smartphones while standing in physical stores, comparing prices, checking reviews, or seeking recommendations in real time.
“It’s not just the internet in your pocket anymore,” said Baird. “It’s like having a highly knowledgeable store associate who knows every retailer.”
To remain competitive, some retailers are equipping frontline staff with AI-powered tools that provide instant access to customer preferences, inventory availability, and product knowledge. Others are exploring in-store AI agents that can notify customers when items are back in stock or suggest complementary products.
The goal, according to industry leaders, is not to replace human associates but to augment their capabilities — allowing them to focus on service and relationship-building rather than information retrieval.
An Industry at an Early but Irreversible Stage
Despite the momentum, most analysts agree that AI-led commerce is still in its early stages. Consumer trust, regulatory frameworks, and technical standards are still evolving. Retailers are experimenting cautiously, balancing innovation with risk management.
Yet the direction of travel appears clear. As AI platforms become more capable and consumers grow more comfortable delegating decisions, the traditional boundaries between retailer, platform, and assistant are likely to blur.
For retailers, the challenge is no longer whether AI will reshape commerce, but how much control they are willing to relinquish — and what they can build in return.
As the industry navigates this transition, one thing is certain: the next era of retail will be shaped not just by products and prices, but by algorithms acting on behalf of millions of shoppers.