Microsoft's Latest Copilot Update Could Help Small Businesses Boost Sales. Here's How It Works

"Microsoft is pitching this new tool to retailers as a way to reach a wider pool of potential customers and offer a seamless shopping experience that is more likely to convert sales. By integrating purchases directly into Copilot rather than redirecting consumers to an external site, the hope is that with one less step, customers will be more likely to click buy, rather than abandoning their cart."

""With Microsoft's agentic AI, retailers can automate what slows them down and amplify what sets them apart, enabling faster decisions and stronger customer relationships," said Kathleen Mitford, corporate vice president of global industry at Microsoft, in a statement released with the announcement on Thursday. This launch is part of a broader effort by AI companies and consumer brands to reach consumers where they are increasingly spending their time online: in large language models."

"Over the holiday season, e-commerce brands saw a boom in LLM referrals. AI-driven traffic to retail websites skyrocketed 693 percent from the year before, according to data from Adobe Analytics. OpenAI released its own competing in-app shopping tool for ChaptGPT last fall. Copilot Checkout will be powered in partnership with Paypal and Stripe, which will enable the checkout and payment processes. Major retailers, such as Urban Outfitters, Anthropologie, and Ashley Furniture, as well as e-commerce platforms, such as Etsy, have already signed on."

Microsoft launched Copilot Checkout to allow shoppers to discover, browse, and purchase without leaving Copilot. The feature integrates purchases directly into the Copilot interface to reduce steps and potentially lower cart abandonment. Shopify merchants will be automatically enrolled with an opt-out option. PayPal and Stripe will power checkout and payment processing. Major retailers and platforms, including Urban Outfitters, Anthropologie, Ashley Furniture, and Etsy, have signed on. Generative AI models are increasingly used as query engines and curation tools, and LLM-driven referral traffic spiked during the holidays, prompting competing in-app shopping tools from other AI companies.

Read at Inc