When AI Takes Over Shopping Carts

Morgan Stanley analysts Andrew Ruben and Nathan Feather discuss how AI shopping agents could reshape e-commerce discovery, purchase journeys, and advertising economics. They see global e-commerce growth accelerating from about 7% to 9% CAGR, with agentic commerce adding to the addressable market even though full autonomous checkout remains limited. They argue large retailers and marketplaces are best positioned early to own the customer journey, while external AI agents pose a longer-term risk to on-site advertising revenue. - Global e-commerce is nearly $5 trillion and can reach $7 trillion in five years with agentic tailwinds. - Agentic commerce alone could add about 6% to the five-year e-commerce addressable market and influence about 20% of volumes. - US and China lead AI shopping adoption, with China survey usage around 30% versus Brazil around 12%. - Early on, large retailers may retain the purchase journey because of purchase history, payments, shipping, and trust. - External AI agents could divert traffic and advertising dollars from e-commerce platforms, a risk worth watching. - Winning companies likely need strong selection, inventory, innovation, and complementary assets like logistics and loyalty.