Google is fundamentally altering the digital shopping experience with the rollout of “agentic commerce” features within its Gemini chatbot and Google Search’s AI Mode. As of , users in the US can now purchase products directly from Etsy and Wayfair without leaving the Google ecosystem, a move signaling a significant shift in how online shopping is conducted.
The core of this change is Google’s Universal Commerce Protocol (UCP), launched last month, which standardizes the connection between AI agents and businesses. This protocol allows for a more seamless transaction process, removing friction from the traditional shopping journey. Etsy and Wayfair were early co-developers of the UCP, alongside retail giants like Walmart and Target, demonstrating the industry-wide interest in this new approach.
“Agentic commerce is no longer just a concept, it’s reality,” stated Vidhya Srinivasan, Google’s VP and GM of ads and commerce. The company’s goal, according to Srinivasan, is twofold: to simplify the shopping experience for consumers and to establish a secure and efficient foundation for agentic commerce across the industry.
From Assistive to Agentic: The Evolution of AI Shopping
This move represents a transition from AI functioning as a mere assistant – recommending products – to acting as an agent that actively facilitates the entire purchase. Google is effectively turning its search and chat interfaces into unified marketplaces. This is driven by a 693% surge in referral traffic from generative AI traffic this holiday season, according to Adobe data.
Central to this transformation is a new advertising format called “Direct Offers.” Unlike traditional pay-per-click (PPC) ads that redirect users to a retailer’s website, Direct Offers present dynamic, AI-generated incentives directly within the chat interface. For example, a user searching for “best mid-century modern coffee tables under $300” might receive a specific product suggestion accompanied by a time-sensitive discount, all within Gemini or AI Mode.
Google is also testing sponsored ads within AI Mode, building on previous efforts to enhance the shopping experience with visual elements, similar to Pinterest. This evolution reflects a broader trend of execution and adoption of agentic AI within the retail sector.
The Universal Commerce Protocol: A Standard for AI Interactions
The UCP is designed to standardize how businesses connect with AI agents throughout the shopping process. This standardization is crucial for ensuring a consistent and secure experience for consumers, regardless of the retailer or AI platform. By establishing a common protocol, Google aims to streamline the integration of e-commerce platforms into its AI-powered services.
The introduction of the UCP and Direct Offers signals Google’s intent to shorten the sales funnel. Traditionally, a consumer might start with a search query, click on an ad, navigate to a retailer’s website, browse products, and then complete a purchase. With agentic commerce, Google aims to compress these steps into a single, seamless interaction within its platforms.
Implications for Retailers and Digital Marketers
This shift has significant implications for digital marketers and e-commerce professionals. The battleground for consumer attention is moving from the traditional search results page (SERP) to the conversational interface of AI agents. Retailers will need to adapt their strategies to optimize for these new AI-powered shopping experiences.
Google’s advertising flywheel is increasingly focused on AI Mode, anticipating higher user engagement. The company’s research indicates that AI Mode provides a more helpful shopping experience when users can easily compare a variety of brands and stores. This suggests that retailers who can effectively leverage AI to present compelling offers and product information will be best positioned to succeed in this new landscape.
Over the past year, Google has been actively refining its AI-powered shopping experience, incorporating features like visual search results and augmented reality shopping tools. The integration of Etsy and Wayfair represents the next logical step in this evolution, bringing the promise of agentic commerce closer to reality. The company continues to test and tweak its approach, aiming to create a shopping experience that is both efficient and enjoyable for consumers.
“We’ve spent the past year testing new ad formats that bridge inspiration and action,” Srinivasan wrote. The company’s ultimate goal is to remove the “gruntwork” of shopping, allowing consumers to focus on the aspects they enjoy while simultaneously building a secure and seamless commercial ecosystem.
