Stories

Artificial Intelligence (AI) is accelerating a major shift in how Australians shop online with new research from PayPal revealing widespread adoption. Half of all Australians (48%) have already used AI assistants for online shopping searches, signalling a clear move away from traditional search. Among Australians under 45, adoption rises to 66%, showing younger shoppers are leading the change.

Most Australians (78%) expect AI assistants to become a mainstream part of the online shopping journey, with 53% planning to use them in the next 12 months. However, trust remains a critical factor – 30% say they’d only engage with AI shopping solutions from brands or platforms they trust.

Confidence in AI recommendations is high for such new technology with 3 in 5 Australians (61%) saying they would trust AI to make product recommendations. Forty-three percent (43%) say they’d trust AI for certain categories, preferring to make the final decision themselves with 18% placing full confidence in AI-led product recommendations.

Agentic AI set to transform customer experience

The advances in AI technology, especially agentic AI, are set to revolutionise how sellers and shoppers interact. Described by the term ‘agentic commerce’, the future of online shopping will involve AI agents autonomously researching, negotiating and executing purchases on behalf of consumers and businesses.

Simon Banks, Managing Director, PayPal Australia explains, “Agentic AI is not just another enhancement to the way humans use technology in retail. It’s got the potential to completely disrupt the existing model of ecommerce.

“Natural language will become common place in helping shoppers find products. Imagine telling AI exactly what you want, in your own words and getting tailored options instantly. No scrolling, or site hopping – just results. From chatbots to social feeds, consumers will be able to make seamless one-click purchases wherever they are.

“At PayPal, we’re already exploring how to give consumers the power to use their PayPal credentials and smart wallet features within AI-powered experiences to seamlessly pay with the right payment method, at the right merchant, at the right time.”

PayPal’s recent partnership with Perplexity, is set to power agentic commerce within the Perplexity Pro chat interface, allowing consumers to find products, book travel, or buy tickets – and check out instantly through a fully-integrated PayPal experience. In April, PayPal launched its agent toolkit and MCP servers on paypal.ai, enabling developers to create experiences for payments, shipment tracking, invoice management and more, all powered by PayPal and within an AI agent.

Shopping smarter: Australians want savings, simplicity and trust

Australians are already thinking of ways AI services could be leveraged to simplify shopping experiences, with many interested in using AI for practical benefits and to find savings. Over one third of Australians (38%) are most interested in using AI assistants for price tracking and deal alerts while shopping online.

This agentic shift presents opportunities and challenges for sellers. “Sellers will need to fundamentally shift how they approach marketing and search functions in response to the growth of agentic shopping tools. They’ll need to put greater effort into building agentic AI experiences and making sure their products appear at the forefront of natural language search,” added Mr Banks.

Despite the increasing use of AI for online shopping, 92% of Australians have at least one concern about using AI when shopping online, with the privacy and security of their personal details their top concern (64%).

“Trust is crucial to enabling agentic commerce. These solutions must be safe and secure, particularly as integration with smart wallets and payment options becomes more readily available. This is where PayPal has a unique advantage in providing the trust and security sellers and consumers have come to expect,” concluded Simon Banks.

While there are security concerns, 57% of Australians are willing to share online shopping habits and preferences to better personalise AI shopping recommendations.