🛍️ Retail's AI advantage

🤖 Brands back bots

📏 Measurement = bottleneck

💳 Lights. Camera. Checkout.

🚀 Media networks transcend retail

🏆 Affiliate winners and losers

🤳 Creator gold rush

The retail industry is emerging as one of AI's biggest commercial winners, forcing companies to embrace bots as buyers and incentivizing rivals to work together to capture new business.

Why it matters: While creative sectors try to prevent AI companies from scraping their content, retailers are inviting them in and betting AI shopping assistants will become a new source of customers.

State of play: Retail has moved quickly to establish new standards and practices to usher in agentic commerce. 

In January, Google launched the Universal Commerce Protocol, an open standard that makes it possible for AI assistants to broadly integrate product catalogs from a vast number of major retailers across the web. 

The standard was co-developed by several companies including Shopify, Etsy, Walmart, Wayfair and Target, and has backing from the world's biggest payment providers, such as Mastercard, Visa and Stripe.

That level of early ecosystem support is unusual, but the impact is promising.

Data: Adobe; Chart: Danielle Alberti/Axios

🛒 By the numbers: Early data suggests AI-powered shopping assistants and recommendations send higher-intent shoppers who convert at higher rates than traditional search traffic.

AI-referred shoppers converted 58% better than visitors from non-AI channels during the second quarter, on average, per Adobe. These shoppers spent 53% longer on retail sites and browsed 20% more pages per visit.

More than half of AI-referred sessions start on product pages, compared with 20% for organic search, according to Shopify data from Q1 2026. The average order values from AI-referred sessions were 14% higher than organic search.

🤓 The big picture: AI agents and search interfaces are replacing much of the research consumers used to do before reaching retailers, helping to focus marketing expenditure and lower customer acquisition costs. 

"These are essentially pre-qualified leads," says Vivek Pandya, lead analyst of Adobe Digital Insights, with shoppers using AI to research products and narrow their choices.

1 big thing: 🛍️ Retail's AI advantage

Illustration of two shopping carts with spiral lines in the backgruond

Illustration: Sarah Grillo/Axios. Stock: Getty Images

The promise of agentic shopping has forced retailers to shift their marketing strategies to welcome bots rather than fight them.

🗣️ Shopping queries are becoming more detailed and conversational, forcing brands to rethink websites and product content as inputs into AI recommendation systems, not just destinations for human visitors.

💄 Instead of searching for "red lipstick," a consumer might ask, "I need a red lipstick for brown skin under $5 — I'm going to France," e.l.f. Beauty chief technology and AI officer Ekta Chopra told Axios last month at Cannes Lions.

📄 Because AI engines are much more likely to elevate organic media over paid marketing, detailed product attributes, image descriptions and accurate inventory data are critical. Chopra says e.l.f. has created a dedicated agentic commerce readiness team.

Yes, but: As retailers embrace AI answer engines, they don't want to surrender the customer relationship.

Instacart CMO Laura Jones says her company has "integrations with all major LLMs" but sees its first-party data — 1.6 billion transactions — as its competitive advantage. "We're being very thoughtful about what data gets shared and what doesn't," she told Axios at Cannes Lions.

Through loyalty data, purchase histories and category expertise, retailers have deep knowledge of customer behavior, Ulta Beauty CMO Kelly Mahoney says. 

Reality check: Brian Monahan, senior vice president of retail media at Albertsons Media Collective, says the company sees AI as a way to improve, not replace, the retailer's experience.

"We're going to obviously work with the big answer engines because we want to partner with them," Monahan says. "But I don't wake up with existential dread that my retail business is going to evaporate into an LLM somewhere."

The bottom line: An AI assistant may reorder shampoo, paper towels or pet food, but people still enjoy some shopping as a form of entertainment and self-expression.

"The winner is going to be the one that understands the customer," Mahoney says. "In this world where it's all very digitized, the human experience is becoming even more and more important."

2. 🤖 Brands back bots

Commerce is spreading across more channels than ever, making it more difficult for marketers to prove what actually drove the sale.

Why it matters: The old consumer funnel is breaking faster than marketers can measure it, with last-click attribution becoming even less useful.

😵‍💫 The big picture: Consumers no longer move neatly from awareness to purchase. They may watch a creator review on TikTok, see an ad on connected TV, price-compare on ChatGPT and ultimately buy on Amazon.

With AI answer engines, brands have little visibility into why certain recommendations appear and how purchase decisions are being shaped.

AI "is increasing discovery, but it's also reducing transparency," Nili Klenoff, executive vice president of commerce media at Mastercard, said at Cannes Lions. "Attention is getting fragmented and accountability is getting fragmented."

The new AI platforms lack mature reporting, says Mike O'Donnell, head of AI at Omnicom's Flywheel.

"The measurement tools today don't really exist in the way we'd like them to across platforms," O'Donnell says. Media metrics "aren't quite as developed at a ChatGPT as they would be at an Amazon or a Google."

Marketers have instead relied on panel data, prompt testing and other third-party signals, he adds.

There's no single replacement for last-click attribution. Marketers use a mix of measurement approaches, including marketing mix models, multi-touch attribution and brand lift studies, Boston Consulting Group's managing director and senior partner Lauren Wiener says.

🐣 Zoom in: AI answer engines are in the early days of developing their advertising capabilities. Albertsons is participating in OpenAI's advertising pilot, which tests ads in ChatGPT.

"For us, things like geo-targeting are really important, and their product isn't there yet," says Albertsons' Monahan. "We're learning a lot about where their capability stands."

Zoom out: Sellers are investing in more interactive formats and better measurement tools to prove campaigns not only were seen but also drove business outcomes.

"Shoppable isn't just a QR code," NBCUniversal chairman, global advertising and partnerships Mark Marshall told Axios at Cannes Lions. "It's the idea of, how do we get results ... and show the real impact of what their investment was?"

3. 📏 Measurement = bottleneck

Illustration of various shopping baskets with radial lines behind it

Data: ARK Investment Management; Chart: Danielle Alberti/Axios

Live shopping is projected to more than triple in the U.S. by the end of the decade as retailers, creators and streaming platforms embrace the format.

Why it matters: After years of failed attempts to replicate China's livestream shopping boom, the U.S. market is finally gaining momentum.

📈 By the numbers: The U.S. livestream commerce market is projected to grow from $200 billion in 2026 to $680 billion by 2030, according to Ark Invest. 

Globally, livestream commerce is expected to expand from $1.7 trillion this year to $3.7 trillion by the end of the decade.

TikTok Shop sales generated through live shopping grew more than 80% in 2025 compared with the prior year, and live shopping gross merchandise volume doubled during the first half of 2026, the company told Axios. 

Whatnot reached $8 billion in live sales in 2025 alone, more than doubling the year before, the company told Axios. Globally on average, users spend 98 minutes a day watching live shows on the platform.

The big picture: Live shopping has evolved into what TikTok calls "discovery e-commerce," where entertainment, product discovery and checkout happen in the same experience, says Patrick Nommensen, president of strategic initiatives for TikTok Shop Americas.

"Live shopping asks the question: Can you make shopping online fun?" Ark Invest's director of research, consumer internet and fintech Nicholas Grous says. Traditional retailers are designed to make shopping "extremely easy."

Sellers don't simply list products. They share the story behind an item, show how a product looks and feels and answer buyers' questions, creating experiences that more closely resemble a favorite neighborhood shop than a traditional e-commerce site.

Whatnot CRO Armand Wilson says the company's success comes from building communities, starting with Funko Pop! before expanding into Pokémon cards, sports cards, fashion and even fresh food.

📺 Zoom out: Streaming companies are looking to bring that engagement and more commerce experiences to television.

NBCUniversal recently launched "Shop What Happens," a Bravo series sponsored by Target across Peacock, YouTube, TikTok and Instagram.

The company already has proof that commerce content resonates with audiences. "Jill's Steals and Deals does over half a billion dollars" in annual sales, NBCU's Marshall says.

Walmart also is expanding its commerce ambitions on TV. The retailer recently acquired Vibe.co, a connected TV ad platform.

🇨🇳 What to watch: The U.S. still trails China because of differences in consumer behavior and infrastructure.

Grous says American consumers are accustomed to shopping through Amazon and other traditional platforms, while China's e-commerce ecosystem evolved around mobile-first experiences that more easily translate to social commerce.

Joy Tang, founder and CEO of creator platform Markable, says logistics also matter, with live shopping working best when sellers have large inventories ready to ship.

4. 💳 Lights. Camera. Checkout.

Note: Some dates reflect substantial updates to existing advertising businesses; Data: Axios research; Chart: Danielle Alberti/Axios

Nearly half of the major commerce media networks launched since 2022 have come from companies outside traditional retail, according to an Axios analysis.

Why it matters: Any company with customer relationships could try to become a media company.

The big picture: The first wave of retail media transformed retailers into advertising businesses. Amazon, Walmart, Target and Kroger proved brands would pay to reach consumers close to the point of purchase.

The newest entrants, however, aren't traditional retailers. Over the past two years, Expedia, PayPal, JPMorgan Chase and RE/MAX have launched media networks. Topgolf announced one this past week.

🤑 Follow the money: Commerce advertising is expected to reach $199.6 billion globally in 2026, growing to $218.2 billion in 2027, according to WPP Media.

Retail media still represents roughly 97% of the market today.

Data: WPP Media; Chart: Danielle Alberti/Axios

Between the lines: Launching a network is not enough.

The winners distinguish themselves through better measurement, richer creative formats and omnichannel reach, says BCG's Wiener.

🌮 Zoom in: Albertsons recently launched "Rico's Tacos," a branded entertainment series developed with Procter & Gamble. New 1-to-2-minute episodes debut every Taco Tuesday through the end of August on YouTube, social media, Albertsons' app and in-store screens.

The project reflects how retail media is expanding beyond bottom-of-the-funnel sponsored listings, says Albertsons' Monahan.

Instead of simply converting shoppers already looking for a product, the goal is to create demand for entire categories through entertainment that ultimately drives consumers into stores.

Yes, but: Not every company with valuable customer data and attention is rushing into commerce media. 

Building a successful commerce media business requires advertising technology, personalization capabilities, measurement and enough premium inventory to attract brand budgets.

Case in point: Marriott launched its media business in 2022, but other hotel companies remain on the sidelines. While United Airlines launched Kinective Media in 2024, rivals like Delta have yet to announce a comparable business. 

5. 🚀 Media networks transcend retail

Data: eMarketer; Chart: Danielle Alberti/Axios

Publishers' commerce businesses are under pressure as AI summaries reduce referral traffic and retailers tighten and shift their affiliate marketing budgets.

Why it matters: Commerce is an even more important source of revenue as advertising dollars become less reliable, pushing publishers to adapt.

🧮 State of play: The challenges are showing up in publishers' financial results.

BuzzFeed reported its affiliate commerce declined 6.9% to $55.5 million for 2025, which the company attributed primarily to changes in supplemental bonus structures from retail partners.

Future's e-commerce revenue declined 6% organically to £76.7 million in fiscal 2025, following a 9% organic decline in fiscal 2024. The pressure has continued into 2026, with e-commerce revenue down 24% organically during the first half of the fiscal year.

Zoom in: Future's declines stemmed from AI Overviews, changes to Google Search and Discover and fewer visits to high-value buying guides and product reviews, CFO Sharjeel Suleman said during an earnings presentation.

But the publisher, which owns Marie Claire, Tom's Guide and Homes & Gardens, isn't retreating from commerce. Future CEO Kevin Li Ying said during the same presentation that new initiatives include a Who What Wear ChatGPT app.

Condé Nast also is investing in AI-powered shopping experiences, including Condé Nast Traveler's Trip Planner.

💸 Condé Nast's U.S. commerce business is up 10% year over year, while revenue per user has tripled over the past three years, senior vice president of commerce Lisa Aiken tells Axios.

Notably, Condé Nast has achieved that growth without paid customer acquisition. Aiken says the company's commerce growth has been driven through its own editorial brands, newsletters, social channels and search, leaving paid marketing as a future opportunity.

Rather than chasing search traffic, Aiken says, the company has focused on richer shopping experiences and its strong editorial brands.

📊 People Inc. employs 250 to 300 people in affiliate commerce, generates hundreds of millions of dollars in affiliate revenue and operates product-testing labs in Alabama, Iowa and New York.

The publisher has become the top affiliate partner for most major U.S. retailers, People Inc. CEO Neil Vogel said at Axios House during Cannes Lions.

"People do not want to buy any fewer toasters than they wanted to buy five years ago," Vogel said.

What to watch: Condé Nast last year announced Vette, a creator storefront platform. It's currently in beta with four creators, with plans to expand the cohort later this year, Aiken says.

Aiken says the effort reflects a broader shift toward shopping through trusted individuals, including editors and creators.

"People trust people and people shop from people," she says.

6. 🏆 Affiliate winners and losers

Creator commerce has evolved from an experimental marketing tactic into a core strategy for retailers, as brands bet trusted human recommendations will matter even more in the AI era.

Why it matters: The shift is motivating brands to rethink how they recruit, manage and measure creator relationships.

By the numbers: Brands are quickly moving more marketing dollars toward creator commerce.

Markable drove $1 billion in affiliate sales last year and expects to double that this year, Tang says.

Markable's creator-driven sales doubled during Prime Day even as overall Amazon sales grew about 15%, she adds.

🎯 Zoom in: Target recently overhauled its creator strategy, winding down its existing affiliate program in favor of Club Target and a partnership with LTK.

LTK president and co-founder Amber Venz Box says brands are realizing creators don't want to manage dozens of retailer-specific affiliate platforms with different logins and workflows. Instead, they want retailers to meet them where they already work.

The response from creators was immediate. Venz Box's Instagram Reel on the Target news drew hundreds of comments from creators praising the move.

Venz Box says that during one of Target's recent campaigns, 100 creators accepted campaign offers within 22 minutes through LTK's platform.

🤔 The big picture: Brands are becoming more selective about which creators they invest in as the industry becomes more saturated and AI makes it easier than ever to generate content.

Creator commerce is becoming more performance-based. Christa Klausner, executive vice president, commerce media at ad agency Digitas NA, says brands are evaluating creators on sales and average order value rather than reach alone.

What to watch: Venz Box expects more retailers to follow Target's lead, moving away from maintaining proprietary creator platforms toward partnerships that reduce friction for creators.

Axios

Axios Media Trends Executive

July 18, 2026

1 big thing: 🛍️ Retail's AI advantage

Axios Media Trends Executive

July 18, 2026

1 big thing: 🛍️ Retail's AI advantage

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