AI + Shopping
A fork in the road between routine and discovery
I’m curious about how AI will reshape commerce. And by commerce, I mean both online (e-commerce) and offline (in-store) shopping.
Take Rufus, Amazon’s chatbot, for example. Not only can Rufus answer questions about the product you’re looking at specifically, but it can also help you pinpoint a product that meets your original shopping needs.
Adding to this point, you know that customer service rep you went back and forth with on your favorite brand’s website? Most likely an AI agent, trained in the brand’s style and tone.
Technology has drastically changed how you shop online. Still skeptical? Think about your own habits.
Once Amazon Prime came along, you likely started taking fewer trips to department stores and got used to two-day free shipping, which contributed to the downfall of legacy retailers like Sears, JC Penney, and Bed Bath & Beyond. Or maybe you’re an Instacart loyalist. No more last-minute trips to the grocery store when you can have the goods show up to your doorstep hours (if not, minutes) after placing an order. But wait, don’t forget Uber Eats. Why walk 15 minutes to pick up Thai food when you can click a few buttons on an app and have it delivered to you shortly thereafter?
Whether you realize it or not, we are entering a new age of commerce, ripe for plenty of disruption.
I believe AI will bifurcate commerce into two distinct categories: monotony and discovery.
By monotony, I mean routine, daily purchases. In When AI Buys Your Groceries, we explored how Visa and Mastercard are both building payments products to allow an AI agent to pay on your behalf, with pre-defined spending guardrails of course. Building on this point, I see monotonous commerce as a clear case study for automation. The paper towels and hand soap you order from Amazon, the fruits and vegetables you pick up at the grocery store, the undershirts you purchase from Target. These purchases rarely vary in selection or frequency, creating fewer outlier scenarios for agents to run into. The goal here would be to save time and energy on tasks that require unnecessary mental bandwidth.
Soon enough, we’ll have our personalized AI agent shopper taking care of our weekly shopping errands and eliminate the hours monotonous commerce eats up each week. And I’m confident these AI agents will be flexible enough that when the grocery store is out of apples, they know your preferences and will order extra blueberries instead!
In contrast, discovery commerce is where shopping feels intentional, personal, and harder to automate. While monotony is about efficiency, discovery is about inspiration.
I believe AI can help a lot with getting started. If I wanted to buy a house, I’d have to do a ton of research to figure out exactly where I should buy the house, based on my wants and needs. Maybe I want to find an area that will minimize my work commute, or I want to live in a strong local school district. AI can help me sort through the noise and save time as I gather information, so I’m ready when it’s time to decide.
Furthermore, I’ve begun to see AI blur the lines between both online and in-store experiences. Companies like GetIt.ai allow brands to place a video of a person on their website, helping customers pick out exactly what they’re looking for and answering any question they may have along the way. But here’s the catch: the video you chatted with wasn’t a real person. It was an AI agent, represented by an avatar created to be the face of the brand. You have big names like True Classic and Lindt sporting the new age of online customer service, with the goal of near-simulating an in-store experience.
As it relates to in-store shopping, AI’s effect on monotonous commerce will reduce the amount of daily shopping that occurs in person. I believe that physical retail stores will continue to evolve into experiential retail and community centers.
Living in the microcosm that is New York City, I find that physical stores are turning into meet-up locations for fans of the brand. From Arc’teryx to Nike, brands are hosting run club meetups, where the start line is their store. There’s also plenty of both small and large brands that include restaurants in their physical locations.
For instance, take Restoration Hardware. They have two restaurants right next to their Manhattan storefront, RH Guesthouse and RH Rooftop. Provide people with an experience when they’re making a purchase, which further enhances the emotional component of discovery commerce. I doubt you’ll instruct an AI agent to shop on your behalf if shopping meant you’re also grabbing a meal at a top restaurant.
I expect stores to carry less and less inventory and lean on robust AI simulators to help you get a sense of how that new dress will look on you. Unfortunately, this may lead to less same-day purchases as the store will then ship you that dress so they don’t have to deal with the brutal process that is inventory demand planning.
Instead, they’ll leverage their store for entertainment, possibly rewarding brand loyalists with exclusive events and first dibs on new products.
Summarizing, we are in the early innings of AI’s disruption of commerce as we know it. Personally, I’m looking forward to the day I never have to think about buying toilet paper again. Instead, I’ll use that time to explore what truly excites me, like discovering new ideas worth caring about.