Week 38 - AI Checkout Hype Check: Shopify's Numbers, Aviator Nation's Early Wins, and the Small Business Digital Divide

MaxWelcome to The Checkout Point, your quick dive into this week's e-commerce buzz with me, Alex, powered by Blicket. These 20 minutes pack the latest trends, news, and insights. Let's navigate the digital marketplace together. Ready? Let's go.

RachelOkay, so picture this. You're checking out online, and it's not you clicking buttons anymore. It's a bot doing the shopping for you.

Speaker 3Sounds relaxing.

RachelRight? Shopify's throwing money at it. OpenAI's got a whole checkout thing cooking. Google's in there too. Everybody's building the robot cashier.

Speaker 3Big flex from all three. Sure.

RachelThis is The Checkout Point. I'm Max. That's Rachel. And we've got a lot to get through this week.

Speaker 3We do.

RachelBut here's my question before we even touch the fancy tech. Is any of this actually working yet? Like, are people buying stuff through AI, or is it just a really expensive demo?

Speaker 3That's... Yeah, that's the question I want answered too, because I've sat in enough meetings where the slide looks amazing and the ROI slide is blank.

RachelOh, no.

Speaker 3I'm serious. Adoption numbers versus announcement numbers are two different documents.

RachelWe'll get into whether the hype matches the actual behavior.

Speaker 3And stick around because later we're talking about who's actually growing right now, and it is not who you'd guess.

RachelSmall guy versus big guy, it gets uncomfortable.

Speaker 3A little.

RachelSeriously, though, if you've got a small shop, stick with us to the end because that part's for you.

Speaker 3It's not just filler. It's kind of the whole point of today's rundown.

RachelAlright. Platforms racing to build this AI shopping future before anybody's proven shoppers even want it. That's where we start.

Speaker 3Let's see if the emperor's got clothes.

RachelOkay, so here's the part that actually stopped me scrolling. Shopify's own explainer breaks down this whole thing called the Universal Commerce Protocol.

Speaker 3The one with Google?

RachelCo-built with Google, yeah. But check the backers list: Amazon, Mastercard, Meta, Target, Walmart, and Visa.

Speaker 3Wait, all of them on the same protocol?

RachelAll of them. Like, companies that fight each other for every dollar of ad spend are suddenly holding hands on Checkout infrastructure.

Speaker 3That's actually kind of wild when you put it that way.

RachelThink about what that actually means for a merchant, though. If Visa, Mastercard, and Meta are all speaking the same Checkout language, That's supposed to mean way less integration headache down the road.

Speaker 3In theory. Instead of building six different custom connectors for every AI shopping surface, you build once and it plugs into all of them. That's the promise anyway. One spec instead of a pile of one-off partnerships that break every time somebody updates their API.

RachelSo what's actually in it for the merchant beyond fewer headaches? Like, does this get them in front of shoppers who weren't finding them before?

Speaker 3Maybe, eventually. Right now, it's still mostly plumbing. The traffic gains are a separate question from whether the pipes exist.

RachelRight. And it's not just Shopify's corner of the Internet.

Speaker 3Because OpenAI is doing their own version.

RachelOpenAI's own announcement lays it out. It's called Instant Checkout built with Stripe running on something they call the Agentic Commerce Protocol.

Speaker 3Okay, walk me through what that actually does because protocol names mean nothing to me.

RachelFair. Basically, US ChatGPT users can already buy stuff from Etsy sellers straight inside the chat window. No tabs, no cart, just buy it there.

Speaker 3Right now. Not a pilot, not a wait list. Live now for Etsy. And OpenAI says over a million Shopify merchants are coming soon on top of that.

RachelA million.

Speaker 3A million.

RachelAnd here's the part I like. OpenAI specifically says the product results in there stay unsponsored.

Speaker 3So it's not like paid placement dressed up as a recommendation.

RachelThat's what they're claiming, yeah. Merchants just pay a small fee when a purchase actually completes.

Speaker 3Okay. That's a meaningfully different business model than search ads, if it's true.

RachelI mean, think about what pay only when it completes changes for a small shop. You're not paying for clicks that go nowhere. You're only paying when someone actually buys.

Speaker 3Sure. And that's the argument for it. It shifts risk off the merchant and onto the platform, which is usually the merchant's favorite kind of deal. Though I'd want to see the actual fee percentage before I called it a good deal. Small fee is doing a lot of work in that sentence.

RachelThere's always an, "if it's true," with you.

Speaker 3That's my whole job here, Max.

RachelFair enough.

Speaker 3But step back for a second. Amazon, Walmart, Target, Visa, Mastercard, Meta on one side. OpenAI and Stripe over here doing their own thing with a million merchants incoming.

RachelTwo totally separate rails both claiming they're the future of how people are gonna shop.

Speaker 3And here's the thing, they're not even compatible with each other. A merchant plugged into one doesn't automatically show up in the other.

RachelWhich means everybody building a storefront right now has to make a bet on which rail is gonna matter more without any real data to base that bet on. That's a rough spot to be in if you're a smaller brand trying to decide where to spend your dev hours.

Speaker 3And nobody's asked the boring question yet.

RachelWhich is?

Speaker 3Is anybody actually using either of them?

RachelExactly, because a backer list is not a user count. Visa signing a press release doesn't mean my mom's buying a candle through a chatbot.

Speaker 3No way is my mom buying anything through a chatbot, Max. I promise you. So that's what I actually wanna know before we crown anybody. Forget who signed on. What does the traffic look like? What are people actually doing at checkout right now?

RachelIt's kind of like everybody announcing they built a highway before anyone's checked if cars are actually driving on it.

Speaker 3Right. And press releases are cheap to publish. Building an actual road people use, that's the hard part, and that's exactly what nobody's shown us yet.

RachelWhich is exactly why the backer list doesn't settle anything for me either. Six giant companies signing onto a protocol tells you about ambition, not about whether a single shopper has clicked buy through it.

Speaker 3Ambition versus usage. That's the whole gap we're chasing this episode.

RachelThat's the pivot, isn't it?

Speaker 3That's the pivot. Pitch decks are cheap. I want the adoption numbers.

RachelThen let's get into what's really happening on the ground because it's not quite the story either side is telling.

Speaker 3I've got a feeling I know where this is going.

RachelShop.

Speaker 3Okay, actual numbers. Shopify's own explainer says AI-driven traffic to their stores jumped eightfold year over year in Q1 2026.

RachelEightfold? That's a big jump.

Speaker 3It is. And AI search orders, so people actually buying after an AI sent them there, that's up almost thirteenfold.

RachelWait, 13 times? Okay, now we're talking real growth.

Speaker 3I mean, thirteenfold on orders is the number that actually matters to me. Traffic is easy to inflate. People click all sorts of links. Somebody actually finishing a purchase after an AI sent them there, that's a real signal.

RachelSure. But real signal and real revenue aren't the same thing either, right? A store could see orders jump thirteenfold off a base of basically nothing and still be talking about a tiny slice of total sales.

Speaker 3Fair. We don't know the base number.

RachelExactly. And multipliers without a denominator make for a great headline and a much murkier picture underneath.

Speaker 3Right. And until Shopify actually publishes a base number, I'm treating both of those multipliers as Directionals, not definitive. It's a great headline stat, but headline stats are exactly the kind of thing marketing teams pick because they flatter the story.

RachelDirectionals fine. Just don't let anyone put eightfold on a slide and call it proof of anything. I wanna see it against last quarter's actual order volume before I get excited.

Speaker 3Traffic and orders, yeah. But traffic isn't revenue, and I wanna know who's actually flipping the switch on this stuff.

RachelSo who said the eightfold number anyway?

Speaker 3Which matters because these traffic numbers didn't leak. They got handed to us directly by the guy running the company. That's a flex, but it's also just marketing until we see who's actually converting.

RachelSure. Though, to be fair, companies usually don't lead with numbers that make them look bad. If Finkelstein's sharing it, it's probably one of the better stats they've got.

Speaker 3Shopify's own president, Harley Finkelstein, shared that one. Marketing Brew picked it up.

RachelOkay, so it's not some random blog post. It's coming from the top.

Speaker 3Right. Straight from Finkelstein. But here's the number that stopped me. Marketing Brew also reported that as of March, only about a dozen Shopify merchants were actually using Agentic Checkout.

RachelA dozen? Out of how many stores are on Shopify?

Speaker 3Millions. A dozen merchants live because of limited platform access. So all that traffic Shopify's bragging about is mostly just browsing. People looking, not buying, at least not through the agent.

RachelThat's like everyone lining up outside a store that's only got one register open.

Speaker 3And that one register thing isn't just a metaphor. If only a dozen merchants can actually run this, then all that traffic Shopify's bragging about is mostly just browsing. People looking, not buying, at least not through the agent.

RachelSo the eightfold and thirteenfold numbers are basically bumping into a wall that Shopify itself put there by limiting access. That's kind of a self-inflicted bottleneck.

Speaker 3Self-inflicted, but also kind of understandable. You don't wanna open the floodgates on a brand-new checkout flow before you've stress tested it.

RachelSure. Caution makes sense. It just means the eightfold headline is doing a lot more work than the reality behind it.

Speaker 3Kind of, yeah. And it's not just Shopify being slow. Fast Company talked to a Forrester analyst, Emily Pfeiffer, and she said brands are rushing into this because of FOMO.

RachelFOMO? Like fear of missing out FOMO?

Speaker 3Exactly that. Her quote was that nobody's actually figured it out yet.

RachelWait, an actual analyst said nobody's figured it out. That's kind of a gut punch for anyone who dropped money on this.

Speaker 3It is. And Fast Company also said the OpenAI and Shopify Instant Checkout rollout fell short of what was originally promised.

RachelFell short how? Like fewer merchants, fewer categories? What? That's frustrating not knowing what fell short even covers. Categories, geography, merchant count. We're just supposed to take smaller than promised on faith?

Speaker 3They didn't spell out every detail, just that the scope came in smaller than what got announced. Which fine, that happens with early rollouts. But it does make you wonder how much of this whole space is still just plans on a whiteboard versus something a shopper can actually touch today.

RachelSo you've got a company saying traffic's up eightfold, and in the same breath, a dozen merchants can actually ring anything up.

Speaker 3That's the gap. Big number on one side, tiny number on the other.

RachelI mean, come on. That's a pretty wide split.

Speaker 3It is. And an outside analyst is out here saying the whole space hasn't cracked the problem.

RachelIt's wild that an analyst paid to watch this space is the one saying nobody's cracked it, not some outside critic. That's coming from inside the room.

Speaker 3Right. And it lines up with everything else we just laid out. Big traffic numbers, a handful of merchants actually live, a rollout that came in smaller than advertised.

RachelThree different data points all pointing the same direction, and none of them came from a skeptic looking to make platforms look bad.

Speaker 3Which honestly makes it more convincing, not less. This isn't outside criticism. It's the industry's own numbers telling on itself.

RachelSo where does that leave us? Is anybody making actual money off this yet?

Speaker 3That's the thing. Some people are, just maybe not the way you'd expect from all the announcements.

RachelNow that I wanna hear. Okay, so real names, real brands. Glossy's got a piece on Aviator Nation. That's the retro California streetwear, the tie-dye hoodies.

Speaker 3Oh, I know those hoodies.

RachelRight? So Glossy says they're seeing early orders coming in from ChatGPT, plus growing sales through Shopify's Shop app.

Speaker 3Wait, actual orders, not just traffic?

RachelOrders. Early ones, sure, but orders. Glossy frames it as them rethinking discovery altogether. Like, where do people even find you now?

Speaker 3That's the first name brand win we heard all episode that isn't a backer logo.

RachelExactly. One brand, one channel, actual dollars.

Speaker 3What I like about the Aviator Nation example is it's not a platform announcement. It's an actual brand deciding where to spend its energy. That's a different kind of signal than a backer list.

RachelRight. Somebody in their marketing team looked at where orders were coming from and said, "Okay, this channel's worth leaning into."

Speaker 3Okay, but I wanna zoom out because most of the money moving right now isn't coming from any of this AI stuff.

RachelYeah. So speaking of actual dollars, PYMNTS had this thing about the summer sales events.

Speaker 3The Prime Day Walmart deals overlap?

RachelYeah. PYMNTS says the overlap changed who showed up and how much they spent, and the crowd fueling Amazon and Walmart summer sales was mostly Boomers.

Speaker 3Boomers, not Gen Z doom scrolling into a chatbot cart. Boomers clicking add to cart on a laptop.

RachelPretty much.

Speaker 3That's the actual story of who's spending money in e-commerce right now, and it's the least sexy possible answer.

RachelI mean, it makes sense, though. Boomers have the disposable income and the loyalty to those two retailers built up over decades. They're not experimenting with some new chatbot. They're doing what's worked for them for twenty years.

Speaker 3Right. And that's a way bigger chunk of actual dollars changing hands than anything we've talked about with Agentic checkout so far. Old habits, but real spending.

RachelIt's kind of the opposite of the story we spent the whole first half of the show on. No protocol, no press release, just people showing up and buying what they always buy.

Speaker 3Which is maybe the most honest data point in this whole episode.

RachelIt's not glamorous, but it's real. And here's another one that's not glamorous: Land's End.

Speaker 3Oh, the catalog people.

RachelStill around. FashionNetwork reported Land's End posted a two point seven percent bump in revenue, up three hundred two million dollars for the quarter.

Speaker 3Three hundred million from a company people forget exists.

RachelAnd it put them back in the black. The driver was strong growth in their US e-commerce channel specifically.

Speaker 3That's honestly a pretty good comeback story for a brand people mostly associate with catalogs from twenty years ago.

RachelAnd it's not one lucky quarter either. It's the whole channel actually performing, which for a brand that age is basically a second life.

Speaker 3Yeah. And it says something that the fix wasn't flashy. Just make the online experience not annoying, and people show up. No chatbot required, no protocol war, just decent execution.

RachelYeah, and it shows the boring stuff still works. Better site, better checkout experience, no fancy AI required, and the revenue follows.

Speaker 3So no ChatGPT checkout, no agentic anything. Just their website worked better, and people bought stuff on it.

RachelThat's the whole thing. Old school online retail doing fine.

Speaker 3This is basically my point from the top of the show. Everybody wants to talk about the protocol wars, but Land's End just quietly fixed their site and made money.

RachelBoring but profitable.

Speaker 3I'll take boring and profitable over an expensive pilot every time.

RachelIt's funny, none of these three stories needed a new protocol or a checkout bot. Aviator Nation just showed up where customers were already looking. Boomers just kept doing what works. Land's End just fixed their site.

Speaker 3Which honestly makes me a little suspicious of how much of the AI checkout conversation is actually about shopper behavior versus just platforms wanting a bigger piece of every transaction.

RachelThat's a little cynical.

Speaker 3I'm a little cynical, Max. It's kinda my whole thing on this show.

RachelSo you've got Aviator Nation catching a wave off AI discovery, Boomers driving the big summer numbers the old-fashioned way, and Land's End turning a profit off e-commerce that has nothing to do with any of this hype.

Speaker 3Three completely different playbooks all making money this week.

RachelRight. But none of those three are small operations without a Shopify develop team or a marketing budget.

Speaker 3Yeah, and that's the uncomfortable part because for every brand actually cashing in on this shift, there's a small merchant who isn't anywhere near it.

RachelAnd nobody really wants to sit with that part. So we keep saying the smallest merchants are getting left behind. I want a number, not a vibe.

Speaker 3Okay, so PYMNTS just put out a piece time to Labor Day, right as everybody's staring down Q4. Mm.

RachelAnd basically, their framing is Main Street has way more ways to sell, get paid, and source goods than it did four years ago.

Speaker 3Sure. That tracks. More platforms, more payment rails, more suppliers online.

RachelRight. But the same piece says that access isn't spreading evenly. The tools exist, but the smallest shops aren't the ones picking them up.

Speaker 3Which is the part that actually matters. Having a tool available and having the time, cash, and staff to implement it are two very different things.

RachelExactly. Like, you're a two-person shop, you're not sitting down to integrate a new checkout protocol on a Tuesday.

Speaker 3You're just trying to keep the lights on through the holidays.

RachelRight.

Speaker 3And it's not like these tools are even that expensive individually. It's the time cost that kills small operators. Learning a new platform, migrating data, testing that nothing breaks, that's hours Nobody on a two-person team has spare.

RachelRight. And hours are the one resource you genuinely can't buy more of during Q4 crunch. You can maybe scrape together the cash for a new tool, but not the bandwidth to learn it properly.

Speaker 3Which is exactly why the tools exist doesn't mean much on its own. Existing and being usable by someone stretched that thin are two different things.

RachelYeah. That gap is basically the whole story in one sentence.

Speaker 3It also means whatever we recommend to a Small shop owner has to respect that time crunch, not just pile another to-do onto their list.

RachelFair. So if there's a takeaway here, it's pick one thing, not Adopt everything at once.

Speaker 3So who is scaling then? Because clearly Somebody's grabbing this.

RachelSo here's an interesting one that's kind of adjacent. Vatai, which does cross-border e-commerce compliance, just filed to list in Hong Kong.

Speaker 3Compliance? Like tariffs and customs paperwork?

RachelYeah, exactly that world. And the filing cites sixty-six percent revenue growth.

Speaker 3Wait, sixty-six percent? That's not small growth. That's a company that found a real problem and getting paid to solve it.

RachelRight? And think about what that says. Cross-border selling has gotten complicated enough that a whole company can grow two-thirds in a year just handling the compliance headache.

Speaker 3So the winners this week aren't just the flashy AI checkout names, it's also the boring infrastructure layer behind global selling.

RachelTotally. Nobody wants to talk about customs paperwork on a podcast, but somebody's making real money off it.

Speaker 3I'd listen to that episode, honestly.

RachelMaybe next season.

Speaker 3In all seriousness, though, that's a pattern worth noticing. When something gets complicated enough, a specialist business shows up to sell you the complexity back to you as a service.

RachelRight. And that's basically the whole infrastructure layer of e-commerce in a nutshell. Shipping got complicated, so you got logistics platforms. Payments got complicated, so you got payment processors. Now, cross-border compliance is complicated, so you get Vatai.

Speaker 3But zoom out for a second. You've got Vatai scaling on cross-border complexity. You've got the platforms from earlier scaling on AI traffic. And then Main Street's smallest guys are stuck trying to just keep their storefront running.

RachelRight. And that's not really one story anymore. It's two. There's the story of who's building the infrastructure and cashing in on complexity.

Speaker 3And the story of who doesn't have the time or budget to even use it.

RachelYeah.

Speaker 3And the smallest businesses fall into the second bucket almost by definition. They don't have a compliance team. They don't have a dev team testing new checkout flows.

RachelThey've got a Shopify store and maybe one employee doing three jobs.

Speaker 3Right. So when the big guys scale, they scale from an already huge base. When Vatai grows sixty-six percent, that's off a business built specifically to solve one expensive problem.

RachelMeanwhile, the corner shop is just trying to figure out shipping rates.

Speaker 3Exactly. It's not a level playing field. It's a totally different field.

RachelYeah, that's the contrast frame right there.

Speaker 3So heading into the holiday run-up, you've got platforms racing ahead on AI-commerce traffic, compliance specialists cashing in on cross-border complexity, and the smallest sellers just trying to hang on to what they've got.

RachelWhich honestly is the real headline under everything we talked about today. Big platforms and specialists are scaling fast, and the smallest storefronts risk getting left out of the whole AI-commerce wave entirely.

Speaker 3That's the state of play heading into the holiday run-up.

RachelYeah. Let's wrap it up. Hmm.

Speaker 3So here's where I land on all of it. The big platforms get the AI wiring. The small sellers get left figuring out spreadsheets on their own, and that gap isn't closing anytime soon.

RachelYeah.

Speaker 3The agentic checkout stuff, the protocols, all that, it's built for merchants who already have a dev team on staff. Main Street doesn't have that.

RachelRight. And that Hong Kong filing we just talked about, that's a company solving problems for sellers who can already afford a compliance vendor.

Speaker 3Exactly. Somebody's got to build the version of this for the guy running one Shopify store out of his garage.

RachelOr that's just next year's episode.

Speaker 3Probably.

RachelBut seriously, if you're running a small shop and you're listening to this feeling a little attacked, that's not the point. The point is the tools built for you specifically probably aren't here yet, and that's worth knowing before you sink a weekend into chasing the wrong upgrade.

Speaker 3Which means the smart move right now is probably not chasing every agentic checkout headline. It's just making sure your actual site and your actual checkout work well for the customers you already have.

RachelSimple as that, honestly. Fix what's already broken before you bet on what's brand new, and you'll be in better shape than half the platforms racing to build this stuff.

Speaker 3That's the whole newsletter right there, really.

RachelAll right. Well, that's a wrap for this week's Checkout Point.

Speaker 3Thanks for hanging with us.

RachelSeriously, thank you guys for listening. If you want more on any of this, the checkout stuff, the small business numbers, whatever, head over to PYMNTS.co. We've got more written up there.

Speaker 3No pressure, just good stuff if you wanna dig deeper.

RachelTotally. We'll catch you next week.

Speaker 3See you then.

RachelGo check your dashboards, folks.