HBR explains how traditionally consumers relied on search engines like Google to find and compare products, reading reviews and hunting for the best deals.Now, AI agents—intelligent algorithms capable of making decisions on behalf of users—are streamlining this process.
Retailers relying on search traffic must adapt as AI agents prioritize price, quality, and service. Smaller businesses may gain visibility as AI-driven searches highlight the best value options. Brands must optimize for AI agents, similar to SEO, to remain competitive in retail.
Platforms like ChatGPT and Perplexity can analyze vast amounts of information, recommend products, and even facilitate transactions, reducing the need for traditional search and retail intermediaries. OpenAI’s new benchmark for its AI models adds another layer to this transformation. AI responses were tested against human arguments on the r/ChangeMyView subreddit, revealing that the o3-mini model now outperforms human arguments in 82% of cases, highlighting the persuasive capabilities of AI agents in various contexts, including consumer shopping decisions. HBR argues that this shift raises critical questions about who truly controls the customer relationship. Historically, retailers and brands shared access to consumer data. Retailers had sales data from transactions, while brands gathered insights through market research. HBR says that AI agents already influence buying decisions. Instead of manually searching for a car, for instance, a consumer can ask Perplexity for the best alternative to a Tesla. The AI not only provides recommendations but also compiles reviews, suggests purchase locations, and could soon handle the entire transaction. These agents are evolving rapidly. OpenAI, Google, and others are integrating them into apps, making them capable of handling complex tasks such as booking trips or finding insurance. HBR says that the next step is automating purchases based on user preferences, fundamentally altering how people shop and how companies sell. HBR suggest that retailers, particularly those reliant on traditional search traffic, will need to adapt. AI agents can scan the internet for the best deals, availability, and service quality, prioritizing objective factors over brand loyalty. This levels the playing field, giving smaller businesses a chance to compete against giants. Consumers, who previously stuck to familiar retailers due to the hassle of comparing options, will now have AI agents do the work for them, as suggested by HBR. Instead of defaulting to well-known platforms, AI-driven searches might highlight niche brands or smaller retailers with better value propositions. This means businesses must rethink their strategies to ensure they remain visible and appealing to AI systems. Brands, too, must adapt. Since AI agents prioritize consumer needs over brand names, companies must emphasize product differentiation, competitive pricing, and strong online presence. HBR argues that the rise of “AI Agent Optimization” (AAO) could mirror the role of SEO in today’s digital marketing, with brands needing to tailor their offerings to AI-driven decision-making processes. As AI agents become more sophisticated, shopping will continue to evolve. Businesses that embrace this shift—by optimizing for AI recommendations and enhancing their unique strengths—will be best positioned to succeed in the new era of retail.
