AI-powered search set to influence US$595 billion in retail e-commerce

Uyen Duong

30th Jan 2026

AI-powered conversational platforms are shortening the traditional purchase funnel to a single interaction, with an impact exceeding US$595 billion in retail ecommerce by 2028, according to Euromonitor International.

The data analytics firm said digital commerce is undergoing a shift as generative AI platforms become a primary channel for information discovery. Referral traffic from AI tools to e-commerce sites increased by 302 per cent between last year, compared with a 23 per cent increase from other sources.

Findings from Euromonitor International’s Voice of the Consumer: Lifestyles Survey 2025 show that more than half of consumers now use generative AI tools, including ChatGPT, Google Gemini and Perplexity, to search for information and receive product recommendations.

Citing analysis from Euromonitor’s Passport database, Rabia Yasmeen, global insights manager for e-commerce at Euromonitor International, said: “AI-powered search is rewiring how consumers discover brands, evaluate choices and make purchasing decisions online.”

Shift in visibility dynamics

This shift is changing how visibility is defined in digital environments. Competition is moving from impressions-based exposure to presence within AI-led conversations. AI-driven discovery is becoming a factor in how influence, trust and competitiveness are formed in the global e-commerce market.

Euromonitor’s analysis of more than 8700 online skincare brands in the US found that up to half may face declining relevance as consumer attention moves toward AI-mediated discovery mechanisms. At the same time, the shift creates entry opportunities for new brands.

“In traditional search, strong brands could rely on SEO, paid search and retail media to secure prominent placement,” Yasmeen said. “In AI-generated answers, there is no guaranteed slot, even for market leaders.”  

She added that shopping interactions are moving from keyword-based searches and product listings to conversational formats, where users ask questions in natural language and expect contextual responses.

Where e-commerce journeys previously involved multiple steps, including search, category browsing, review reading and comparison before adding items to a cart, AI-mediated journeys are compressing these stages into a single interaction.