Retailers adapt to AI shopping traffic

As shoppers increasingly use AI chatbots like ChatGPT and Google Gemini for product recommendations, retailers including Walmart, Ulta Beauty, and Wayfair are updating their websites to rank highly in chatbot searches. However, they are resisting efforts to cede customer data, preferring that purchases remain on their own websites to collect valuable data on browsing habits and past purchases. According to Juniper Research, shoppers are expected to spend $8 billion this year after AI agents direct them to retail sites. Adobe Experience Cloud reported that 41% of U.S. consumers used generative AI for online shopping in June, and visitors referred by AI services generated 41% higher revenue per visit than traditional channels. Retailers like Ulta Beauty are seeing double the conversion and intent from AI-referred shoppers and are working with Google to integrate shopping carts and loyalty programs into Gemini. Amazon — Amazon Web Services is encouraging retail clients, including Tapestry's Tapestry, Inc. — Kate Spade New York, to use AI platforms for marketing while ensuring their own websites remain the best place to buy. Knotel is optimizing its website for ChatGPT results but aims to keep bookings on its own platform. OpenAI ended its Instant Checkout tool in March, focusing instead on product discovery and helping merchants like Etsy use their own checkouts. Consumers still appear more comfortable completing purchases on retailers' own websites, giving retailers the upper hand for now.