AlphaSense@AlphaSenseInc
Industry expert explains how $GOOGL is positioning itself to lead the shift toward agentic commerce:
- The expert sees $GOOGL in a stronger position than OpenAI on agentic commerce precisely because the infrastructure is already in place: Google Pay, existing product listings, and payment solutions are all live and working today, making the shift to agentic checkout largely a setup exercise. OpenAI announced an instant checkout experience in ChatGPT but walked it back within two weeks, which the expert sees as a reflection of how many open questions still exist on that side, compared to $GOOGL, where the foundational pieces are already in place.
- The expert emphasizes that the merchant-of-record question is where agentic commerce gets complicated, noting that losing that status creates many unresolved issues with returns, taxes, and cross-border transactions, which quickly make that model impractical. Still, the expert sees the volume of users on LLM platforms as too large to ignore and views getting products into those environments as a way to stay ahead of a generational shift in which younger consumers increasingly turn to AI to decide what to buy.
- The expert highlights several gaps in the current $GOOGL offering. Ranking is unpredictable, with search results shifting positions in response to parameter changes, such as size selection, in ways that $GOOGL's own product team cannot fully explain, meaning there is no loyalty built into the system and no transparency around how results are ordered. Also, the MVP does not support multiple quantities or multi-item bags, which creates friction for any retailer with an average transaction above one unit.
- Another unresolved question is cannibalization, with the expert noting that a user transacting directly on $GOOGL Shopping might not land on the retailer's site, removing all the downstream opportunities around basket size, credit card sign-ups, and repeat visits that make those customers valuable in the first place. Even $GOOGL struggled to explain how success should be measured in that scenario.
- The expert believes that agentic commerce is not a meaningful traffic driver in the short term, noting that LLM-sourced traffic has been among the lowest of any search engine, though month over month growth has been consistent. Looking further out, the expert sees single digit percentage of total sales coming from LLMs as achievable within roughly two years.