The checkout aisle is disappearing—and it's being replaced by a conversation. Microsoft unveiled Copilot Checkout this week at the NRF 2026 retail conference, a feature that lets shoppers complete purchases directly within its AI assistant without ever visiting a merchant's website. The move marks a pivotal moment in the battle for control of e-commerce, as tech giants race to position their AI platforms as the new front door to online shopping.​

The Death of the Redirect

Copilot Checkout eliminates what Microsoft describes as "friction" in the buying process—those extra seconds and clicks required to navigate from product discovery to purchase. When a user asks Copilot for a recommendation, the AI can now present product options with embedded "Buy" buttons that trigger an in-chat checkout interface. Shoppers enter shipping and payment details without leaving the conversation, completing transactions in a single, fluid experience.​

The feature launched in the United States on Copilot.com and integrates with payment processors PayPal, Stripe, and Shopify, as well as inventory from Etsy sellers. Participating retailers at launch include Urban Outfitters, Anthropologie, and Ashley Furniture. Mike Edmonds, VP of Agentic Commerce at PayPal, noted that the partnership "enables merchants to become AI-ready and enabling scale through Copilot's trusted commerce infrastructure".​

Who Controls the Customer Relationship?

Despite Microsoft managing the user interface, merchants retain their status as the "merchant of record"—meaning they own the transaction, customer data, and relationship. This design choice addresses a critical concern in AI-powered commerce: retailers fear losing direct customer connections if checkout processes migrate entirely into AI dialogues.​

Rafe Colburn, Chief Product and Technology Officer at Etsy, framed the opportunity clearly:

"By bringing Etsy's unique inventory to Copilot Checkout, we're meeting buyers at the moment intent becomes action".

Early performance metrics support the value proposition—journeys that include Copilot led to 53% more purchases within 30 minutes compared to those without, and when shopping intent is present, Copilot-assisted journeys are 194% more likely to result in a purchase.​

Brand Agents Bring AI to Merchant Sites

Alongside Copilot Checkout, Microsoft introduced Brand Agents—AI-powered shopping assistants that operate directly on merchant websites. Available now for Shopify merchants, Brand Agents are trained on a brand's product catalog and respond to customer queries in the company's voice. The system can be deployed "in hours, not weeks" and provides intuitive conversational guidance that helps shoppers compare products, answer questions about shipping or returns, and surface checkout links at the right moments.​

Alexander Del Rossa, a premium sleepwear retailer, reported conversion rates 3X higher in Brand Agent-assisted sessions than in unassisted sessions. Tony Baldwin, the company's CTO, called it "the best example of AI integration seen to date". The agents are integrated with Microsoft Clarity, a free analytics tool that provides merchants with dashboards showing engagement rates, conversion uplift, and average order value for agent-assisted versus organic traffic.​

The Bigger Picture: Agentic Commerce Wars

Microsoft's announcement positions the company squarely in competition with OpenAI, Google, and Amazon, all of whom are racing to embed shopping capabilities into their AI platforms. OpenAI launched a similar shopping assistant in ChatGPT several months ago, though the company acknowledged it "might make mistakes about product details like price and availability". Google has introduced agentic checkout features in Search and AI Mode, while Perplexity's AI-enhanced browser facilitates purchases—a development that has drawn criticism from Amazon.​

Mani Fazeli, VP of Product at Shopify, emphasized the transformative potential: "Copilot Checkout can move a customer from intent to transaction in seconds, all without leaving the conversation. This is the modern power of Agentic Storefronts: personalization and relevance, trust and accuracy, speed and convenience". For Shopify merchants, enrollment is automatic following an opt-out window, with no application or integration required.​

What This Means for Retailers

The shift toward conversational commerce represents both opportunity and risk. Merchants gain access to high-intent shoppers at the moment inspiration strikes, potentially capturing sales that might otherwise be lost to cart abandonment or comparison shopping. However, as checkout experiences migrate into AI platforms, the question of who owns the customer journey becomes increasingly complex.​

Microsoft is adopting open standards, such as the Agentic Commerce Protocol, to ensure merchant onboarding remains seamless and scalable. Non-Shopify merchants using PayPal or Stripe can apply to join Copilot Checkout, while Shopify merchants will be automatically enrolled. As the feature expands across the Copilot ecosystem—including Bing, MSN, and Edge—merchants will gain reach without additional integration work.​

The message from Microsoft is clear: the gap between "I'm interested" and "I'm buying" is shrinking, and whoever shows up strongest in those moments will win the sale.​

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