OpenAI’s first attempts at agent shopping stumbled. I’m trying again

When OpenAI announced its instant checkout feature last fall, retailers sprung into action.

Etsy, walmart and Shopify Users quickly got in line to be able to buy sellers’ products directly within the ChatGPT chatbot. The e-commerce world suddenly turned to shopping agents, artificial intelligence tools that can make purchases on your behalf.

Shopify President Harley Finkelstein called it a “new frontier” for online retail.

A few months later, OpenAI and its retail partners were back to square one.

The AI ​​startup has moved away from instant checkout and is now working with retailers to create dedicated apps within ChatGPT. This approach gives retailers more control over the customer experience and transaction process, as users are rerouted to the retailer’s own website to complete the purchase.

“OpenAI underestimated how difficult it would be to make a deal happen, which is a little surprising, but it’s not easy for retailers,” Gartner analyst Bob Hetu said in an interview with CNBC.

An OpenAI spokesperson said the company is prioritizing improvements to search and product discovery in its chatbots, and is seeing some early user adoption in these two areas.

“Instant checkout is moving to the app, making purchases more seamless,” an OpenAI spokesperson said in a statement.

The Information was the first to report on OpenAI’s pivot.

This change in strategy raises questions about whether tech companies and their retail partners have oversold the responsiveness of shopping bots. It also highlights the challenges that AI startups may face as they seek to change the e-commerce landscape, which is dominated by established giants such as: Amazon.

OpenAI is racing to keep pace with rivals such as: google Anthropic has released a flurry of new services and experiences over the last year in an effort to expand market share and build 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 exploring its commerce strategy, competitors like Google aren’t sitting idle either.

On Thursday, Google released a new update to its Shopping Agent platform that allows the system to load real-time product data, helping prevent incidents like out-of-stocks and mispricing. It also allows users to add multiple items to their cart and connect loyalty memberships. These two features are yet to be fully understood by OpenAI.

OpenAI initially touted Instant Checkout as “the next step in agent commerce that helps ChatGPT not only find what to buy, but also buy it.”

The company said it collects a “small fee” on each transaction, but did not provide additional financial details.

OpenAI said in its announcement that products from U.S. Etsy sellers will now be available for purchase directly on ChatGPT, and products from “more than 1 million” Shopify merchants will be added at some point.

Onboarding merchants has proven to be a difficult process, and instant checkout is error-prone, said Emily Pfeiffer, principal analyst at Forrester. As of last month, there were about 30 Shopify merchants with instant checkout available, he said.

Walmart has made approximately 200,000 items available for purchase within ChatGPT, the company confirmed. It’s unclear how many Etsy products were registered with the service.

OpenAI may scrape some retailer websites to obtain data about products published on ChatGPT, but that means information such as product availability, estimated delivery times, and shipping costs may be inaccurate or outdated, Pfeiffer said in an interview.

“Crawling and scraping alone is not enough to get all the product data you need to successfully conduct commerce,” Pfeiffer said.

“I don’t think it’s been the ideal shopping experience, but agency commerce hasn’t disappeared,” she added.

OpenAI introduced its Apps SDK at its annual developer conference in October to begin adding purpose-built retail apps to Instacart’s chatbot. target Several online travel agencies also participated last year.

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

Buyers will still be able to discover Shopify sellers’ products within the chatbot, but the checkout will no longer be native. Instead, purchases will be completed through the merchant’s own online store, either within the in-app browser of the ChatGPT mobile app or within a separate browser tab on the web, the company said.

Merchants don’t need to build an app for ChatGPT to participate in that experience.

At an investor conference earlier this month, one of Walmart’s AI executives said in a telegram that OpenAI’s commerce strategy is in flux. He described instant checkout as “very temporary.”

“By this time next month, we won’t be seeing experiences like that anymore,” Daniel Danker, Walmart’s executive vice president of AI acceleration, products and design, said at the Morgan Stanley Technology, Media and Telecom Conference on March 4. “The Sparky experience will go directly into ChatGPT and Gemini and whoever else we integrate with.”

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

An Etsy spokesperson also confirmed that the online marketplace is developing a ChatGPT app. They noted that the timing and direction are still in flux, so the application may not be in its final state when it comes to how Etsy products appear in the chatbot.

A spokesperson said the app will give customers more control over the look and feel of shopping on ChatGPT. They also say that instant checkout allows retailers and marketplaces to provide more shopper data earlier in the purchase journey, whereas instant checkout only allowed them to confirm a transaction after someone had made a purchase.

Pfeiffer said the current ChatGPT app experience “still has a lot of room for improvement” and there is no guarantee it will be a successful model for AI shopping.

“At this point, I don’t think ChatGPT’s retail app will be successful,” Pfeiffer said. “That doesn’t mean it doesn’t exist. Recruitment takes time.”

Early data shows that shoppers are increasingly using AI chatbots for product research and recommendations, but they are not completing their purchases in the chat window.

adobeBased on a survey of more than 1,000 U.S. consumers published earlier this month, Semrush, owned by , found that only 22% of users purchased a product within an AI tool. Half of respondents said they made a purchase after using AI during a study.

Walmart said it found that the conversion rate, or percentage of users who make a purchase, for products sold directly on ChatGPT was three times lower than for products that redirected users to the retailer’s website for checkout. Wired first reported the Walmart data.

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

Pfeiffer said retailers that see traffic from chatbots or believe their product is best suited for that type of experience are likely to invest in the platform if they can afford it.

For Etsy, the ChatGPT app could encourage more sellers to join the platform by allowing them to participate in new marketing channels, she added.

bank of america Securities analysts said in a recent research note that OpenAI’s new app-based approach “could enable more partners, such as Amazon,” as it gives retailers more control over user experience and payments on ChatGPT.

Amazon has been deepening its relationship with OpenAI in recent weeks.

The two companies announced a strategic partnership last month, with Amazon investing up to $50 billion in OpenAI. As part of the deal, OpenAI will make its AI models available to Amazon engineers to develop consumer products.

The companies did not say which products may be involved.

At the same time, Amazon is distancing itself from AI shopping partnerships. The company blocked access to dozens of agents’ sites, including OpenAI’s ChatGPT.

Amazon sued Perplexity in November in an attempt to stop its Comet browser from scraping users and making purchases on the website. The legal battle is already in chaos.

Perplexity called Amazon’s lawsuit a “foolish attempt” to stop shoppers from using Comet because its AI agents “don’t have the eyes to see the extensive advertising Amazon bombards users with, and can’t be pumped up to buy more products.”

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

Hetu said OpenAI is working to improve its approach to e-commerce, and consumers shouldn’t ignore the company even though it faces stiff competition.

Pfeiffer added that AI shopping as a whole is still in its infancy.

“Everyone assumes that everyone else has this figured out or is way ahead of them,” Pfeiffer said. “The reality is that no one understands this.”

Attention: Advertising industry growing dissatisfied with ChatGPT’s advertising deployment