Episode summary
When AI Takes Over Shopping Carts
Thoughts on the Market (Morgan Stanley)
· · 9 min · Hosts: Andrew Ruben, Nathan Feather
Summary
E-commerce is already a share gainer in retail, and the analysts argue that agentic AI could be the next major catalyst. They say global e-commerce is a nearly $5 trillion market today, rising toward a $7 trillion opportunity over the next 5 years as growth accelerates to about 9% compounded, with agentic tools potentially adding roughly 6% to the addressable market and influencing about 20% of industry volumes.
The conversation draws a distinction between AI-assisted discovery and fully autonomous checkout. Right now, about half of consumers start shopping at the top of the funnel with a chatbot at least sometimes, but only a small portion complete purchases there. The analysts think usage will broaden over time, especially in the US and China, where adoption is furthest along, but trust remains a barrier in markets like Brazil.
They also argue that retailers likely keep control of the customer journey for now because they already have purchase history, payments, shipping, and trust. Still, external agents could shift traffic and ad dollars if shoppers do not accept sponsored results in chatbot flows. The likely winners, they say, will be companies with strong inventory, logistics, loyalty, financial services, and their own AI tools or partnerships.
Key takeaways
- The analysts estimate agentic commerce could add about 6% to the 5-year e-commerce addressable market and affect roughly 20% of industry volumes.
- About half of consumers already start shopping with a chatbot at least sometimes, but only a small portion complete checkout there, so adoption is still early.
- The analysts see the US and China leading AI shopping adoption, with their survey showing about 30% of China consumers and about 12% in Brazil using AI tools over the past month.
- Retailers likely keep the customer journey early on because they hold purchase history, payment details, shipping data, and consumer trust.
- The main risk for platforms is that external agents could divert traffic and advertising dollars if chatbot interfaces limit or reject sponsored placements.
Notable quotes
“Global e-commerce, as we see it, is nearly $5 trillion market today”
“We think agentic alone could add about 6% to the 5-year e-commerce addressable market”
“about half of consumers are starting the top of the funnel at least sometimes with a chatbot”
“the rules of retail and e-commerce should still hold”
How the episode opens
Welcome to Thoughts on the Market. I'm Andrew Ruben, Latin America Retail and E-Commerce Analyst at Morgan Stanley. — And I'm Nathan Feather, US Small and Mid-Cap Internet Analyst at Morgan Stanley.
Today, what happens when the shopping cart starts thinking for itself and maybe even for you? It's Monday, August 17th at 10:00 a.m. in New York.
As we think about trends that are driving e-commerce, which remains a share gainer within the overall retail landscape, it seems that there's a transformation that's quickly building around agentic e-commerce. So, Nathan, I think it's timely for us to talk today as agentic seems like it could be the next catalyst of growth and innovation within the e-commerce landscape.
How much bigger do we think agentic commerce could make the global e-commerce market?
Global e-commerce, as we see it, is nearly $5 trillion market today. That implies 22% of retail sales. The way we see over the next 5 years is a $7 trillion opportunity with growth accelerating to a 9% compounded rate, up from about 7% over the past 4 years.
And this is partly on the tailwinds from agentic. What we see here is this broad arc of reducing friction with e-commerce over time. Think about how easy it is now to pick up your phone, search for some inventory, click, and the goods can be here within 1 to 2 days, if not same day.
That's reduction of friction that we think physical retail can't match. And the improvements of agentic commerce, having this agent that can help you search, help you discover, that should further the e-commerce opportunity. We think agentic alone could add about 6% to the 5-year e-commerce addressable market with about 20% of industry volumes having some material agent influence.
So, within this opportunity, Nathan, agentic isn't one-size.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- ai shopping agents
- agentic commerce
- e-commerce growth outlook
- autonomous purchasing
- reducing e-commerce friction
Watch the episode
Watch “When AI Takes Over Shopping Carts” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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