Episode summary
A Novel Way to Shop Online
Thoughts on the Market (Morgan Stanley)
· · Hosts: Nathan Feather · Guests: Brian Nowak
Summary
Brian Nowak and the host argue that agentic commerce—AI shopping assistants that research, compare, and buy on a user’s behalf—could become a meaningful driver of U.S. e-commerce well before many investors expect. Morgan Stanley’s work suggests agentic commerce could reach 10% to 20% of overall U.S. e-commerce by 2030 and add 100 to 300 basis points to overall e-commerce growth, with grocery and household essentials likely to be early winners because online shopping in those categories is still high-friction.
The discussion centers on the gap between consumer interest and actual purchasing. While 40% to 50% of U.S. consumers already use AI tools for product research, only a mid-single-digit percentage are using them to start shopping journeys or buy items today. The host and Brian Nowak say the tools are still immature, but the demand signal is clear, and they expect grocery agents that can build baskets from simple prompts to emerge over the next 1 to 2 years.
They also argue that the shift could reshape platform economics. Large social and video platforms may gain value as gatekeepers for product discovery, while retailers and e-commerce companies could face pressure if agents reduce direct traffic and the high-margin retail media revenue tied to current transactions. Retailers, they say, will need differentiation, inventory, fulfillment, and on-site innovation to stay relevant.
Key takeaways
- Brian Nowak says agentic commerce could become 10% to 20% of U.S. e-commerce by 2030 and add 100 to 300 basis points to growth.
- The host and Brian Nowak say 40% to 50% of U.S. consumers already use AI for product research, but only a mid-single-digit share use it to shop or buy today.
- Brian Nowak expects grocery and household essentials to be the biggest early use cases because agents can remove much of the friction of building a basket.
- Brian Nowak says large social and video platforms could benefit as discovery shifts to agents that sit at the top of the shopping funnel.
- Brian Nowak warns that e-commerce profitability could face pressure if agents disintermediate retail media and direct traffic.
Notable quotes
“We believe that aentic commerce could grow to be 10 to 20% of overall US e-commerce by 2030”
“40 to 50% of consumers in the US already use different AI tools for product research but only a mids singledigit percentage of them are actually really starting their shopping journey or buying things today”
“it'll know your preferences. It'll know you already like a certain brand of tortillas, and it'll add those to the cart”
“I think over the next few years, we're going to realize that Agentic Commerce is no longer a fringe experiment or a concept. It's a reality”
“there is some tension around profitability. You know, we we are in a world where a lot of e-commerce companies, they generate an outsized percentage of their profit from advertising and retail media”
How the episode opens
Welcome to Thoughts on the Market. I'm Brian Noak, Morgan Stanley's head of US internet research. And I'm Nathan Feather, US Small and Midcap Internet Analyst. — Today, how AI powered shopping assistants are set to revolutionize the commerce experience. It's Tuesday, February 17th at 8 a.m. in New York. Nathan, let's talk a little bit about Agentic Commerce. When was the last time you reordered groceries or bought household packaged goods or compared prices for items you thought online and said, "Boy, I wish there was an easier way to do this. I wish technology could solve this for me." Yeah. Yesterday, about 24 hours ago.
Well, our work on Agentic Commerce shows a lot of these capabilities could be sooner than a lot of people appreciate. We believe that aentic commerce could grow to be 10 to 20% of overall US e-commerce by 2030 and potentially add 100 to 300 basis points of overall growth to e-commerce. There are certain categories of spend we think are going to be particularly large unlocks for agentic commerce.
I mentioned grocery, I mentioned household essentials. We think these are some of the items that Agentic Commerce is really going to drive a further digitization of over the next five years. So maybe Nathan, let's let's start at the very top.
Our work we did together shows that 40 to 50% of consumers in the US already use different AI tools for product research but only a mids singledigit percentage of them are actually really starting their shopping journey or buying things today. What does that gap tell you about the agentic opportunity and some of the hurdles we have to overcome to sort of close that gap from research to actual purchasing? Well, I think what it shows is that clearly there is demand from consumers for these products.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- agentic commerce
- online shopping
- u.s. internet research
- small and mid-cap internet
- ecommerce
Watch the episode
Watch “A Novel Way to Shop Online” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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