Google launches Universal Commerce Protocol, bets on AI-powered retail

Source Domain: www.cnbc.com

Google introduced the Universal Commerce Protocol (UCP) at the National Retail Federation’s annual show with aims to become an industry standard for AI-driven retail processes.
The open-source UCP provides a unified system for the entire shopping experience, aiming to eliminate the need for retailers to build their own tools, consolidating tasks like discovery, buying, and post-purchase support.
To capitalize on the booming generative AI market, Google is competing against companies like Amazon, Perplexity, and OpenAI in e-commerce.
Competitors like OpenAI have also introduced their own protocols like the Instant Checkout via AI Mode powered by their AI, while Perplexity is partnering with PayPal for a direct shopping experience.
By 2030, AI-powered tools and agentic commerce are projected to make the retail sector a $3 trillion to $5 trillion global market, according to the McKinsey report.
UCP was co-developed with companies such as Shopify, Etsy, Wayfair, and Target, and will soon enable purchasing direct from Google’s AI Mode or Gemini App using Google Wallet and plans to integrate additional payment methods like PayPal in the future.
Google also announced the Business Agent feature to allow interactive conversations with shoppers enabling retailers to connect to users on their platforms.
Lastly, Google added a focus on integrating advertising with its “Direct Offers” to showcase special discounts to AI Mode chatbot users expressing buying intent.

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