Key Takeaways:
When OpenAI was founded as a nonprofit in 2015, its mission was rooted in safety and broad public benefit. A decade later, the lure of capitalism has reshaped its trajectory, pushing the company to chase revenue streams beyond just subscriptions.
In April, speculation arose about a potential partnership between OpenAI and Shopify. Developers discovered code strings in ChatGPT's production assets, indicating a direct shopping experience within the chatbot. The same month, OpenAI introduced an improved ChatGPT shopping experience, enabling users to compare products through enhanced visuals and reviews. Reports suggested that the feature was directly linked to products from Shopify merchants. The following month, OpenAI quietly updated its ChatGPT documentation to list Shopify as a verified third-party data provider, alongside Bing. Then, in July, sources told the Financial Times that OpenAI is working with Shopify to integrate checkout directly into ChatGPT.
This update would transform the user shopping experience by allowing purchases to be completed entirely within ChatGPT. For OpenAI, it marks a significant step toward monetizing its conversational AI tools through e-commerce. The partnership opens up a significant new sales channel for Shopify and immediately establishes the platform’s dominance within the evolving world of AI-driven commerce. Shopify powers around 12% of all US e-commerce, serving 875 million shoppers in 2024. Overall, Shopify merchants have generated more than $1.1 trillion in revenue. For consumers, it represents possibly the greatest shift in e-commerce since the advent of the smartphone.
Currently, ChatGPT can recommend products with images, reviews, and links, but purchases are redirected to external websites. The new feature, still in development, would streamline this process by integrating a native checkout system directly into the chatbot. OpenAI and Shopify have been showing early prototypes to brands and negotiating commission structures, according to the Financial Times.
“The rules of e-commerce are changing,” Chaz Giles, CEO at Alida Labs, an applied AI company, told BeautyMatter. Today’s e-commerce gatekeepers are Google and Meta, and they charge their own kind of “tax for attention,” as Giles put it. But soon, that gatekeeper is changing.
“OpenAI, Cloud, and Perplexity are now going to be the ones who are paid that tax, and there's going to be some new rules for how brands have to compete to stay relevant,” he added.
OpenAI initially began experimenting in categories including beauty, fashion, home goods, and electronics, with plans to expand based on user feedback. A company spokesperson told BeautyMatter that the results shown in ChatGPT are chosen independently and are not ads.
“Commerce in ChatGPT is still early, and we’ll continue to bring merchants along our journey as we quickly learn and iterate,” the spokesperson added.
According to an OpenAI press release, ChatGPT search will be open to all websites and merchants. To maximize visibility, the company advises brands to confirm they haven’t opted out of OpenAI’s search crawler, which indexes content to surface in ChatGPT results. Merchants will also have the option to submit product feeds directly to ChatGPT once submissions open, ensuring listings are accurate and up to date. OpenAI has not yet provided a timeline for when feed submissions will become available.
The Shopify integration builds on shopping enhancements introduced this past April, when OpenAI introduced product recommendations featuring reviews, images, and contextual suggestions. Product listings are currently generated from third-party merchant metadata, and ranking does not yet take into account price or shipping speed. However, with the recent memory upgrades, ChatGPT can now recall user preferences, such as favorite colors, budget limits, or style choices, and incorporate them into personalized recommendations.
This personalization positions ChatGPT as a challenger to Google Search, which has long dominated product discovery. Instead of returning lists of links, ChatGPT can refine answers into detailed comparisons. Over time, this level of customization has the potential to redefine how consumers shop online.
What It Means for Beauty Brands
Where traditional search engines like Google once drove users to websites for discovery, research, and purchase, ChatGPT is collapsing that journey into a single experience within its own platform. For brands, this means losing direct control over consumer relationships and shopping experiences, as more of the customer journey shifts away from external DTC sites and onto AI platforms. Giles predicts that this will necessitate a shift away from SEO towards AI optimization (AIO).
“From a brand standpoint, all the work you might’ve done to rank at the top of search results is suddenly a lot less important. Now, it’s about figuring out how to properly communicate with an AI engine and help it better understand not only the general aspects of your business but also the nuanced details that set it apart from the rest,” he said.
“Brands and e-commerce companies will have to figure out how to feed these engines rich, detailed information so they can deliver relevant answers to consumers who are asking far more personalized questions than traditional search ever allowed.”
The hope, Giles explained, is that consumers will receive much more relevant and targeted answers to their questions. But to get those answers, brands will need to be incredibly specific in who their target shopper is if they want to improve product visibility in chatbot results. This means rewriting product descriptions and even rethinking how to present clinical results in a way that best highlights the specific demographics brands intend to target. In the age of AIO, specificity matters more than broad optimization.
“Instead of focusing on SEO, brands should be asking, ‘Who is this product really for?’” explained Nick Howard, Director of Strategy at AI consultancy, Amble & Co. “That means revisiting product descriptions and being willing to narrow your focus. For some brands, that feels risky because it shrinks the potential audience.”
AI thrives on precision, as Howard put it. All of that detail will matter when AI engines make personalized recommendations. If you feed it rich, detailed information, it should, in theory, deliver near-perfect recommendations to the right consumers. And over time, this is what builds brand loyalty, which is something that legacy brands, in particular, have struggled with in an increasingly oversaturated market like the beauty industry.
“Start optimizing now by getting really clear on who your hero customer is and which products truly serve them,” recommended Howard. “It might take time for the systems to catch up and process enough information, but ultimately that’s what will make the difference—and that’s what I find exciting.”
AI shopping is poised to become a powerful force in the ongoing battle for customer data, but it won't happen overnight. With the end of third-party cookies, e-commerce is undergoing a fundamental shift away from mass targeting and towards data ownership.
Beauty brands, like all e-commerce brands, rely on first-party consumer data to create tailored experiences. During the DTC boom of the early 2010s, beauty brands were able to bypass traditional retail middlemen and sell directly to customers through their own websites, gathering valuable first-party data through website interactions, newsletter sign-ups, and purchase history in the process. Over the years, that model evolved into a more complex omnichannel strategy, which now means that retailers like Ulta Beauty and Sephora retain much of that valuable customer information.
AI engines like ChatGPT can only personalize recommendations to the extent of the data they have access to, and brands and retailers are unlikely to share the data they’ve spent years accumulating—giving way to an expensive game of chicken.
“If these three parties [OpenAI, Shopify, and merchants] can come to some kind of conclusion, or if consumer shopping behavior does become so prevalent within generative AI engines that they can eventually reach that level of personalization, that could create a very interesting future, but it's not happening tomorrow. It’s happening three to five years from now,” Howard predicted.
It’s unclear whether merchants selling products through ChatGPT will have access to any of that valuable customer data, although Howard believes that it’s unlikely. While brands may benefit from incremental sales from ChatGPT commerce, they also risk losing visibility into who their customers are, what they’re buying, and how they shop. That lack of insight could create major challenges, particularly for new brands that might not have that rich customer data to begin with. For more established brands that know their customers and what products they need to solve specific problems, ChatGPT commerce presents a potential gold mine.
“I think there will be a boom of new brands that figure out how to feed AI agents and create product experiences consumers really enjoy. They will be the ones to take off in this ChatGPT commerce boom,” said Giles. “We see this in every kind of major technology change. Brand value becomes even more important, but I think what makes it valuable is going to fundamentally shift. If brands can't make that hairpin turn quickly, a lot of brands are going to fly off the side of the cliff.”
The integration of shopping into AI platforms raises additional concerns about trust and authenticity, according to retail expert Kate Fannin. Adding paid recommendations to Chat GPT risks turning it into another ad channel, where the biggest spenders dominate visibility, sidelining smaller brands and genuine discovery.
“Think about the products near the checkout line at Sephora or Ulta Beauty. You might end up buying something you wouldn’t have otherwise. With AI shopping, how can you discover when the answer is given to you?”
“It’s disheartening because discovery disappears,” added Fannin. “Bigger brands can fine-tune their presence, but smaller brands can’t afford to compete. They’ve relied on the chance to be discovered organically in ChatGPT, and that trust just won’t exist in the same way anymore.”
There’s also the issue of credibility. Until now, answers on ChatGPT have been aggregated from multiple sources, giving the impression of objectivity. Once shopping and sponsored recommendations come into play, that neutrality comes into question. Consumers may start to wonder whether a suggestion is based on relevance and quality, or if a brand paid the most for placement.
“Yes, it’ll make shopping easier, but it won’t feel authentic,” said Fannin. “There may be convenience, but if recommendations are based on who pays the most, there will also be a very high level of distrust.”
Howard argued that AI shopping is still an upgrade from SEO-driven search. The benefit of AI engines is that they combine web results with sentiment analysis from sources like Reddit, Quora, and product reviews, allowing AI engines to surface not just what ranks well, but how people actually feel about a product. This, he said, helps deliver more precise, personalized recommendations, but only if the AI engine has enough data.
“AI is all-powerful in that it can find and analyze way more information than ever before, but it still doesn't know what it doesn't know,” Howard explained. “If your primary purchasing habits are outside of your ChatGPT search history, it’s not going to be as personalized as it could be.”
Inside OpenAI’s Shopping Spree
Up until this point, OpenAI earned most of its revenue through subscriptions to ChatGPT Plus and enterprise licensing. By embedding checkout, OpenAI could monetize the vast number of free users who make up the bulk of its traffic. OpenAI intends to charge merchants commissions on each sale.
The company reported its annualized revenue run rate hit $10 billion in June 2025, nearly doubling from $5.5 billion in December 2024. However, the losses are equally as staggering; about $5 billion last year, according to Reuters. Embedding commissions into ChatGPT purchases could diversify revenue beyond subscriptions, offering a scalable model that leverages its massive base of 700 million weekly users.
OpenAI’s move to embed native checkout in ChatGPT will impact the future of e-commerce in ways that were unimaginable even just a few years ago. By leveraging Shopify’s infrastructure and monetizing through commissions, OpenAI aims to turn everyday conversations into meaningful conversions. The strategy not only addresses its financial challenges but also positions ChatGPT as a new kind of shopping gateway—one that could challenge Amazon, Google, and the broader e-commerce ecosystem. Brands and retailers will need to find their place within this new framework, which involves drilling down to identify their ideal customer and serving them the products they’re looking for.
AI powers the future of shopping, whether brands like it or not. If OpenAI’s expansion into e-commerce is successful, it could reshape not only how people chat with AI, but also how they discover, evaluate, and purchase nearly everything online.
