Marketplace Briefing: Why ChatGPT checkout isn’t a threat to Amazon’s dominance — yet
This is the latest installment of the Marketplace Briefing, a weekly Modern Retail+ column about the ever-changing e-commerce marketplace landscape. More from the series →
OpenAI is pushing deeper into e-commerce with a new checkout feature that lets shoppers buy goods directly within ChatGPT. The move invariably challenges Amazon, but the e-commerce giant doesn’t need to worry about its retail empire being upended just yet.
On Monday, OpenAI announced that U.S. ChatGPT users can now purchase products directly from Etsy sellers without leaving the chatbot. Soon, such users will also be able to shop directly from more than a million Shopify merchants, including Glossier, Skims, Spanx and Vuori, through this service, called Instant Checkout.
The new feature is powered by the Agentic Commerce Protocol, which the technology company says was built with Stripe and other partners. In addition to this initial Instant Checkout rollout, OpenAI has open-sourced its Agenetic Commerce Protocol for merchants to start building their own integrations. Businesses can then apply to have their products made available for purchase through ChatGPT. Purchases are powered by Stripe, and merchants pay a small fee on each order, while there is no charge to users. The exact size of the merchant fee is unclear.
OpenAI said Instant Checkout marks its first step into “agentic commerce,” a futuristic vision of shopping in which AI agents act independently on a user’s behalf. In practice, however, there is little that is agentic about the current version. Shoppers still initiate the search, choose a product and click to buy — much like any other e-commerce transaction. The only difference is that the payment form sits inside ChatGPT rather than redirecting to a brand’s website. Emily Glassberg Sands, Stripe’s head of AI, told Modern Retail in an interview that the protocol lays the groundwork for agentic commerce in the future.
“As consumers become more comfortable, and the AI models improve over time, more control is likely to be handed to the agents to act on our behalf,” she said.
The move has been in the works for months — the Financial Times reported in July that OpenAI was developing a checkout system — and it comes as ChatGPT has become an increasingly important shopping referral engine. In August, ChatGPT drove 20% of Walmart’s referral traffic and more than 20% to Etsy, Modern Retail previously reported. Now, instead of merely sending clicks, OpenAI has a way to capture some of that value.
Given that more than half of online shoppers in the U.S. start their product searches on Amazon’s sprawling web store, ChatGPT’s checkout announcement should, in theory, rust Amazon’s e-commerce crown. ChatGPT aside, data suggests Amazon has already lost market share to rival e-commerce players like Temu, Shein and TikTok Shop. Amazon’s share of U.S. marketplace e-commerce peaked at 71% in 2022 and will dip to around 64% this year, per eMarketer. If you consider ChatGPT a marketplace of sorts, Amazon’s market share may decline further.
But Amazon still commands the majority of online shopping and controls the logistics backbone that makes its marketplace difficult to replicate.
For now, ChatGPT’s e-commerce experience is limited. ChatGPT’s Instant Checkout only supports single-item purchases. This will certainly change over time. OpenAI said it plans to “add multi-item carts and expand merchants and regions,” though the AI company did not provide a timeline for when these developments will happen.
Amazon’s chief advantage lies in the logistics muscle it has built over the past two decades. Amazon has conditioned Prime shoppers to expect convenient, ultra-fast delivery.
“When buying through ChatGPT, because you’re dealing with Etsy or Shopify sellers, it’s very much a roll of the dice,” said Sky Canaves, principal retail and e-commerce analyst at eMarketer. “You don’t go into the purchase knowing that you’re going to get it very quickly.”
That could change, however. Even though Amazon isn’t currently using ChatGPT’s protocol, Amazon announced last month that its third-party logistics service will expand to handle orders for Walmart, Shein and Shopify. This means that Amazon could still generate revenue from orders placed on ChatGPT if they come from a Shopify merchant.
“If an e-commerce dollar happens in the U.S., at least in some way shape or form, Amazon is taking a cut,” said Ryan Craver, chief strategy and data officer at Podean, a marketing agency that helps over 200 brands grow their sales on marketplaces like Amazon.
EMarketer’s Canaves also said that consumers are unlikely to buy groceries, for example, through ChatGPT. Amazon’s grocery business has become a core priority for the company, with Amazon focusing on features like same-day delivery to attract grocery shoppers. On Wednesday, Amazon announced a revamp of its private-label grocery brand, now called Amazon Grocery, to create a compelling offer for cost-conscious shoppers and drive repeat purchases.
Where Amazon could eventually feel more pressure is in its advertising business. The company’s $56 billion ad unit depends on consumer discovery happening inside Amazon. If shoppers increasingly rely on AI tools outside of Amazon for product searches, that could erode traffic and ad revenue.
“Amazon’s highest margin business, even higher than AWS, is ads,” said Scot Wingo, author of the Substack Retailgentic and founder of ReFiBuy, a company that helps brands and retailers optimize for agentic AI. “If ChatGPT is successful in siphoning off homepage traffic, that puts that at risk.”
Still, he added that such a scenario would take time to play out. For now, ChatGPT’s checkout feature does not support sponsored placements, and OpenAI has said product rankings are organic, “ranked purely on relevance to the user.” OpenAI’s Chief Financial Officer, Sarah Friar, previously told the Financial Times that the company was exploring advertising options.
For sellers, ChatGPT checkout represents a potential new sales channel. Many Amazon merchants struggle to drive traffic to their standalone DTC sites, and traditional digital advertising on Google or Meta can be costly, Craver said. Of Podean’s client base — the agency works with over 200 brands — all have DTC sites, but some of them use platforms other than Shopify, like WooCommerce or Magento. Such brands are showing more interest in switching over to Shopify because of its deal with OpenAI.
“Conversations about transitioning to Shopify have been very rampant,” Craver said. “They have accelerated more so in recent months because of stuff like this.”
What I’m reading
- Amazon debuted a line of private-label groceries priced largely under $5.
- President Donald Trump signed an executive order approving a proposal that would keep TikTok alive in the U.S.
- Walmart pledges to remove synthetic dyes from its U.S. store-brand food products by January 2027, per Bloomberg.