Retailers Race to Win Over AI Shoppers This Holiday Season

The traditional battle for consumer attention during the holiday season, once dominated by multi-million dollar advertising campaigns targeting human eyeballs, is undergoing a significant transformation. Retailers are now strategically shifting their focus towards attracting a different kind of audience: AI agents. With an estimated $253 billion in US online sales projected for this holiday season, the majority will still originate from direct website visits or standard online searches. However, the increasing integration of sophisticated chatbots like OpenAI’s ChatGPT and Google's Gemini into the shopping experience is rapidly changing the landscape. These shopper-facing AI tools are now capable of delivering detailed product descriptions, facilitating price comparisons, and even enabling direct purchases within large language models, as US consumers increasingly leverage AI for guidance on everything from gift ideas to essential stocking stuffers.

This evolving digital environment has given rise to new strategies for online visibility. Brian Stempeck, CEO of generative engine optimisation platform Evertune.ai, notes a dramatic increase in content creation among brands. "We've seen brands that previously were putting out three or four new blog posts or articles a month, are now trying to do 100 or 200," he explains. Evertune.ai, which charges clients approximately $3,000 per month, helps apparel and shoe companies make their websites discoverable by large language models. Historically, retailers crafted their Google and Meta ad placements based on user search queries and past click behavior. Without direct advertising options within the leading generative AI tools, companies are exploring innovative methods to gain traction.

One such method involves significantly ramping up branded blog content or actively engaging in product discussions on platforms like Reddit. More radically, some major retailers are constructing dedicated websites that are invisible to human shoppers, designed solely to be read and scraped by AI bots. These automated data extraction tools then feed information to platforms such as ChatGPT and Gemini, which subsequently incorporate this data into their suggestions for gifts, apparel, and other holiday merchandise. The goal is to ensure their products are readily available when AI agents are queried by consumers seeking recommendations.

While the current traffic to retail websites originating from generative AI platforms remains a small fraction of overall activity, retailers are keenly aware of the burgeoning opportunity. Data firm Sensor Tower reported that in October, ChatGPT referrals to Amazon, Walmart, and eBay each accounted for less than 1% of their respective site's total traffic. Despite this modest beginning, companies like eBay emphasize the high intent of shoppers who arrive via agentic AI. Amazon CEO Andy Jassy also highlighted in an October earnings call that customers utilizing their Rufus agent are 60% more likely to make a purchase, indicating the quality of these AI-driven leads.

In response to this trend, companies are adopting multifaceted approaches. Bed linen company Brooklinen, for example, is engaging social media influencers to discuss its bath towels and comforters across platforms like Facebook, YouTube, and TikTok. Brooklinen COO Rachel Levy notes that AI scrapers can extract valuable product information from the text of reviews and audio transcripts within these posts. Furthermore, Brooklinen strategically submitted its $199 comforter for awards from influential publications such as The New York Times' Wirecutter, aiming to boost its chances of appearing in AI agent responses. Levy acknowledges that current traffic from agentic AI sources is "super small," partly because Gen Z, the primary adopters of tools like ChatGPT, currently possesses less buying power compared to older demographics.

Other innovative strategies include direct advertising within AI ecosystems. Miami-based hair care company R+Co is purchasing ads on Amazon’s voice assistant Alexa, meticulously targeting them based on the specific questions customers are posing to its Rufus agent, as detailed by R+Co President Dan Langer. Concurrently, Google has introduced features empowering shoppers to leverage AI for price tracking and product purchases, a functionality entirely dependent on retailers' products being easily discoverable by Google's scrapers. Lilian Rincon, vice president of product for Google Shopping, confirms that the company's AI Mode and Gemini chatbot weigh numerous factors, including store locations and retailer quality, when generating product link referrals for users.

Google is actively testing ads within its AI Mode in the US, although not yet within the Gemini app itself. Existing Shopping and Performance Max ad campaigns are eligible to appear in AI Mode during this testing phase, signalling Google's intent to monetize this new avenue. The demonstrated effectiveness of AI-driven recommendations and shopping experiences is leading to broader adoption. Beyond Amazon's Rufus, major retailers like Walmart and Target have recently unveiled plans for apps that will allow customers to shop directly through chatbot interactions, solidifying AI's role as a critical interface in the future of retail.