Shopify’s offices in Toronto in May, 2024. Agentic AI is an autonomous AI system that can perform actions with minimal human commands or oversight.Sammy Kogan/The Globe and Mail
Shopify Inc. SHOP-T has partnered with Google and Microsoft Corp. to help shoppers find and buy its merchants’ products more easily through artificial-intelligence chatbots, and is launching a new customer plan to open these AI sales to other brands.
This is the latest in a slew of announcements by e-commerce companies embracing agentic AI. Shopify joins the likes of Walmart and Wayfair in signing such deals with Google.
On Sunday at the National Retail Federation conference in New York, Shopify said it would soon allow merchants to sell directly through Google’s Gemini app and its AI Mode in Google Search. And just days prior, Microsoft announced that it was pushing shopping and checkout through to its own chatbot app, Microsoft Copilot, with an integration for Shopify.
Agentic AI allows shoppers to search for products online through AI chatbots and then buy items without leaving the conversation. Shopify, which hosts online stores for merchants and takes a cut of those stores’ sales, announced its first partnership of this kind with ChatGPT in September.
Analysts have said the use of agentic AI – autonomous AI systems that can perform actions with minimal human commands or oversight – will allow more customers to find more Shopify merchants’ products, and has the potential to reshape the future of online shopping and advertising.
Rise of AI chatbots for online shopping boosts analyst hopes for Shopify’s growth
Agentic AI is good at “finding the product that is just perfect” for customers, Shopify co-founder and chief executive officer Tobi Lütke said in a statement. “These AI assistants are not just going to talk to you, they’re going to do stuff for you,” he said, but “the person, the shopper, is in charge, and they can make the final call.”
The announcement is another boost for Shopify, which has posted a string of quarters showing double-digit earnings and revenue growth. The Ottawa-based company’s shares were trading at US$164.48 on the Nasdaq exchange at Friday’s market close, near all-time highs reached last fall when it announced the ChatGPT partnership.
“Shopify is uniquely positioned because we have both expertise and visibility from behind the scenes of what’s happening and ability to partner with the largest companies like OpenAI and Google,” Shopify chief technology officer Mikhail Parakhin said in a statement.
In addition to its new integrations with Google and Microsoft, Shopify is also offering a new Agentic plan, the company said on Sunday. This will allow brands with online stores hosted on any e-commerce platform to use its infrastructure to sell on AI channels without needing to have a Shopify online store.
With this plan, any brand will be able to list its products in Shopify’s catalogue, the company’s collection of billions of products that are categorized by large language models, the company said in a release on its blog on Sunday. This allows chatbots such as ChatGPT or Gemini to find the products and suggest them to shoppers.
The Google integrations rest on a new open standard that Shopify co-developed with the search-engine giant called the Universal Commerce Protocol. This allows AI agents to complete checkout on a customer’s behalf, Shopify said in the release.
The new protocol – in computer science, a standard set of rules that determine how data are moved – will allow customers to submit discount codes, input loyalty credentials, select billing options and confirm selling terms such as final sale conditions within the chatbot conversation. The protocol works with any payment processor, including Shopify Payments, the e-commerce company said.
“When shoppers are ready to buy, merchants can meet them with the right offer, at the right time, right inside the conversation,” the company said. “Agentic commerce transforms every conversational interface into a place to discover and buy from brands globally.”
