Agentic AI is Poised to Be the Biggest Retail Disruption Since E-Commerce

The retail world is facing its third revolutionary shift in just a couple of decades, following the rise of mass marketplaces, which were preceded by the e-commerce boom. What was once a competition between brands became each brand battling with each other and the online behemoth that is Amazon.com. The fight for customer spend became that extra bit more complicated when the layer of pushing for direct purchases rather than marketplaces like Amazon became the go-to for many shoppers.

Just as retail and marketing teams were getting comfortable with introductory artificial intelligence tools, such as chatbots and large language models (LLMs) for building content, agentic AI is now rampaging through the door. In May, Google introduced Shop with AI, which is poised to significantly transform the online shopping experience. Unlike traditional recommendation engines, agentic AI doesn't just suggest products, it actively helps users search, select and even purchase items on their behalf. Personalization and the hunt for the best price will be essentially automatic. As this technology rapidly evolves, brands must prepare for an era when machines may become the primary decision-makers in the customer journey, making it less likely for customers to purchase directly from the retailer.

Twenty years of optimizing the product page, cart, and checkout may suddenly be irrelevant. That leaves us with two key questions to answer.

How Do We Build a Differentiated Direct-to-Consumer Relationship to Keep Customers Coming Directly to Us?

In theory, an AI agent can know a customer so well that it can streamline the entirety of anticipation of needs, discovery and transaction into a single endeavor. It can know a customer so well that they no longer need to shop; it shops for them. According to Salesforce, 22 percent of shoppers are already using AI for inspiration and product discovery. That’s just the tip of the iceberg.

That means the stakes for brand building are higher than ever. The role of loyalty and customer experience is no longer a nice-to-have; it’s mission-critical. Brands that invest in meaningful, long-term relationships with their customers today will be far better positioned to thrive in the AI-driven commerce of tomorrow. It’s crucial to inspire consumers to buy directly from brands. That desire can only come from an emotional connection built on trust, consistent value, and a memorable customer experience.

Viewing loyalty as currency has been long outdated but will become an Achilles heel in the near future. Loyalty needs to be reimagined as a comprehensive strategy encompassing personalization, emotional resonance, safety, and reward that create a sense of value beyond price. That can come in the form of gamified experiences that boost interaction, rewards like free shipping or bonus gifts for buying directly, creating VIP experiences that money can’t buy, and so on.

Lets not forget about the incredible value that first-party data provides to retail and marketing teams. By feeding that into their own AI tools, like virtual assistants, retailers can unlock hyperpersonalization on par with an agent. With that in mind, there’s even a future where we could see agent-to-agent commerce. A customer’s personal shopping AI might negotiate directly with a retailer’s AI to strike a deal.

How Do We Show Up and Win in New Agentic Channels?

Unfortunately, this question primarily leads to more questions. How fast will these agentic commerce platforms gain share? How do we surface the appropriate price, promotion and loyalty message where the customer is shopping? Is there any differentiation left other than price, assortment and fulfillment?

Generative engine optimization (GEO) is a new discipline on the rise that will work toward finding answers to these questions. This practice will be the future of search engine optimization shifting away from simply fixating on keywords, but moving toward optimizing content to appear in AI searches. By working to ensure your website and other content are concise and easy to comprehend for an AI search engine, it will increase the likelihood that it appears in AI-generated responses in systems like ChatGPT. Every brand and retailer needs to be working toward this to help ensure their products show up in front of agentic AI shoppers.

Ark Invest, a leading fund manager, estimates that by 2030, agentic AI could drive as much as $9 trillion in e-commerce sales, accounting for 25 percent of global transactions. The clock is ticking. Agentic AI may still be evolving, but the time to act is now.

Sam Panzer is director of industry strategy at Talon.One, a loyalty and promotion engine.