OpenAI’s first try at agentic shopping stumbled. It’s trying again

When OpenAI announced Instant Checkout last fall, retailers jumped into action.

Etsy, Walmart And Shopify It quickly lined up to allow users to purchase merchants’ products directly through the ChatGPT chatbot. Suddenly, the e-commerce world focused on shopping agents, artificial intelligence tools that can shop on behalf of users.

President of Shopify Harley Finkelstein he called it the “new frontier” of online retail.

A few months later, OpenAI and its retail partners went back to the drawing board.

The AI ​​startup is moving away from Instant Payment and is now working with retailers to build custom apps on ChatGPT. This approach will direct users to the retailer’s own website to complete a purchase, giving these companies more control over the customer experience and transaction process.

“OpenAI underestimated how difficult it would be to enable transactions, which on the one hand is a little surprising, but on the other hand it’s not easy for retailers,” analyst Bob Hetu of Gartner told CNBC in an interview.

An OpenAI spokesperson said the chatbot prioritizes better search and product discovery, areas that have seen early traction in user adoption.

“Instant Payment is moving to Apps where purchases can go more seamlessly,” an OpenAI spokesperson said in a statement.

Information He was the first to report OpenAI’s pivot.

The change in strategy has raised questions about whether tech companies and their retail partners are overselling the readiness of shopping bots. It also highlights the challenges AI startups may face as they try to disrupt the e-commerce landscape dominated by established giants such as: Amazon.

As OpenAI races to keep up with rivals Google and Anthropic released a slew of new offerings and experiences last year in an effort to expand market share and create new revenue streams. E-commerce has emerged as a potentially lucrative opportunity as shoppers turn to ChatGPT to ask questions about products.

While OpenAI is trying to figure out its trading strategy, rivals like Google are standing still.

Thursday on Google launched New updates to the shopping agency platform that allow their systems to upload real-time product data, preventing disruptions like out-of-stocks and pricing errors. It also allows users to add multiple products to their carts and link loyalty memberships; Two features that OpenAI hasn’t yet fully figured out.

OpenAI originally billed Instant Payment as “the next step in agency commerce where ChatGPT not only helps you find what you want to buy, but also helps you buy it.”

The company said it would receive a “small fee” from each transaction but declined to disclose any additional financial details.

OpenAI said at the time of the announcement that products from US Etsy sellers will be available for purchase directly from ChatGPT, and that products from “over a million” Shopify sellers are expected to be added at some point.

Emily Pfeiffer, principal analyst at Forrester, said merchant onboarding is a challenging process and Instant Pay is prone to errors. As of last month, there were about 30 Shopify merchants available through Instant Payment, he said.

Walmart offers approximately 200,000 products for sale on ChatGPT, the company confirmed. It’s unclear how many Etsy products have been launched.

Pfeiffer said in an interview that OpenAI may crawl some retailers’ websites to obtain data about products that show up on ChatGPT, but that means whether products are still in stock, estimated delivery timing or shipping costs may be inaccurate or outdated.

“Scanning and scraping are insufficient to get all the product data you need to do a good job in commerce,” Pfeiffer said.

“I don’t think it’s an ideal shopping experience, but it’s not like the death of agency business,” he added.

OpenAI introduced App SDK It began adding custom retail apps to Instacart’s chatbot at its annual developer conference in October. Aim and several online travel agencies last year.

Shopify has confirmed that a new e-commerce experience is coming to ChatGPT.

Buyers will still be able to explore Shopify sellers’ products in the chatbot, but the checkout will no longer be native there. Instead, purchases will be completed through merchants’ own online stores, in the in-app browser on the ChatGPT mobile app, or in a separate browser tab on the web, the company said.

Merchants will not need to develop applications for ChatGPT to participate in this experience.

at once investor conference Earlier this month, one of Walmart’s top AI executives telegraphed that OpenAI’s commerce strategy was changing. He called Instant Pay a “very temporary moment in time.”

“This time next month, you won’t see this experience anymore,” Daniel Danker, Walmart’s vice president of AI acceleration, product and design, said at Morgan Stanley’s Technology, Media and Telecom conference on March 4. “What you’ll see is that the Sparky experience will transfer directly to ChatGPT, Gemini, and anyone else we integrate with.”

A Walmart spokesperson confirmed to CNBC that the company plans to integrate its Sparky AI assistant into ChatGPT as soon as next week.

An Etsy spokesperson also confirmed that the online marketplace is developing a ChatGPT app. They noted that timing and direction remain fluid, so an app may not be the final version of how Etsy products will appear in the chatbot.

An app would give more control over the look and feel of shopping on ChatGPT, the spokesperson said. They also said it gives retailers and marketplaces more customer data earlier in the buying journey compared to Instant Checkout, which only displays the transaction after someone makes a purchase.

Pfeiffer said the current ChatGPT implementation experience “leaves a lot to be desired” and there’s no guarantee it will be a successful model for AI exchanges.

“I don’t see success with retail applications on ChatGPT right now,” Pfeiffer said. “That doesn’t mean it won’t happen. Adoption takes time.”

Early data showed that while shoppers are increasingly turning to AI chatbots for product research and recommendations, they are not completing their purchases in the chat window.

Adobeowner Semrush found that only 22% of users had purchased a product from within an AI tool. based on a survey It was launched to more than 1,000 US consumers earlier this month. Half of those surveyed said they made a purchase after using AI during the research.

Walmart said it found that conversion rates, or the percentage of users making purchases, were three times lower for products sold directly on ChatGPT than for products that directed users to a retailer’s website for payment. wired Walmart first reported its data.

Etsy observed that ChatGPT had become a valuable discovery channel for online shoppers, but purchase volume from Instant Checkout was relatively low because the technology was still new, the spokesperson said.

Retailers who see traffic from chatbots or believe their products are suited to this type of experience will likely invest in the platform if they can afford it, Pfeiffer said.

He added that a ChatGPT implementation for Etsy could encourage more sellers to join the platform because it allows them to appear in a new marketing channel.

Bank of America OpenAI’s new app-based approach “could enable more partners like Amazon” because it allows retailers to more closely manage the user experience and payments on ChatGPT, securities analysts said in a recent research note.

Wonder in the name Amazon’s lawsuit is a “naked attempt” to stop shoppers from using Comet because AI agents “don’t have the eyes to see the pervasive ads Amazon bombards its users with, and more sales can’t be made to buy more items.”

Amazon continues to invest in its own tools, such as the Rufus shopping chatbot and the “Buy for Me” agent. The company also expanded its “Direct Shopping” feature, which allows consumers to browse and shop for products not sold on its site.

As OpenAI tries to improve its approach to e-commerce, Hetu said consumers should not discount the company even if it faces stiff competition.

Pfeiffer added that shopping with artificial intelligence is generally still early days.

“Everyone thinks everyone else has it figured out or is ahead of them,” Pfeiffer said. “The truth is no one has figured it out.”

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