European digital trade is expected to grow by 6 percent annually by 2029, despite the gloomy consumer climate. For the authors of the McKinsey study “Europe’s new e-commerce agenda: How AI is resetting growth and competition”, this not only indicates “remarkable resilience”, but also describes a fundamental change: artificial intelligence (AI) is no longer just a supporting tool, but as a driving force is completely reorganizing European online commerce. This shift is taking place in five key shifts that are fundamentally revolutionizing the way companies grow and compete.
“Developments in e-commerce range from new ways of product discovery to the complete automation of transactions by AI agents. For retail companies, this means the transition from individual pilot projects to the complete integration of AI into all commercial and operational core processes,” comments Philipp Kluge, partner at McKinsey in Munich, in a press release.
1) Paradigm shift in e-commerce
The first major change concerns the emergence of a new technological paradigm that replaces the previous leaps from catalog to web shop and from desktop to smartphone. As leading experts point out in the study, this new era of AI is fundamentally changing how customers shop and retailers serve them, as technology is now integrated deeper into the value chain than ever before.
“AI is the next paradigm shift in e-commerce. Just as we have developed from catalogs to online shops, from online shops to mobile offers and from mobile offers to platforms, AI will fundamentally change how customers shop and how we serve them,” explains Otto CEO Boris Ewenstein in the study.
2) “Agentic Commerce” changes the playing field
The second fundamental shift concerns consumer behavior itself and manifests itself in so-called agent-based commerce, “agentic commerce”. Here, platforms are moving away from pure user interfaces that were designed exclusively for the human eye, towards systems that can act autonomously.
Customers are increasingly delegating tasks such as finding the best offer, automatically reordering standard items or putting together a shopping cart according to defined criteria for price, brand, delivery speed or sustainability. AI systems are increasingly able to interpret consumers’ intentions, independently evaluate various options and carry out multi-step actions, ultimately making purchases on behalf of consumers.
More than a third (38 percent) of Europeans already use AI when researching purchases. This automation breaks traditional patterns of customer contact and shifts some of the decision-making power from people to the software. According to the experts in the study, the market potential is enormous: by 2030, between three and five trillion US dollars (around 4.37 trillion euros) in B2C retail sales could be generated globally via agentic commerce models.
3) Retail competes for the attention of algorithms
This development directly results in the third central change that redefines the entire competition: retailers no longer compete primarily for the attention or clicks of human users, but for the favor of the algorithms. As AI assistants pre-select customers, the battle for market share shifts behind the scenes of data streams.
The authors of the study make it clear that product data, pricing logic, availability signals and delivery reliability are the crucial inputs for this automated software decision-making, which is why companies must learn to be optimized for machines instead of people.
4) Shopping experiences rely on social media content
The fourth shift affects retailers’ internal processes and transforms creative work in marketing into a strictly data-driven growth lever. AI systems take over the automated creation of content, testing different product variants and the precise delivery of personalized messages in real time. Industry experts describe in the report that AI is increasingly determining what content is created and what messages are shown to whom, while at the same time retail media, i.e. the marketing of advertising space directly on retailers’ platforms, is becoming a structural lever for companies’ profit margins.
“I foresee three different customer journeys: One segment prefers the traditional shopping experience and is often skeptical of AI and data protection. Another segment relies on hyper-personalized recommendations, particularly influenced by social media. Finally, a new “headless commerce” model is emerging in which AI assistants seamlessly shop on behalf of users on different platforms,” predicts David Roberts, Chief Technology and Product Officer of the online shopping platform Allegro.
5) AI is reinventing omnichannel
The fifth and final change is a completely new, AI-supported omnichannel intelligence that will finally eliminate the outdated separation between digital and stationary commerce. Instead of looking at data in isolated channels, leading players are bringing all information together on one platform.
As McKinsey analysts point out, AI brings a whole new level of edge to omnichannel strategy by integrating behavioral, transactional and operational data, optimizing pricing, promotions, inventory and service across the entire customer journey rather than just at individual, isolated touchpoints.
“Customers don’t think in channels and neither should we. Omnichannel means consistent prices, promotions and service – and optimization for the entire customer journey, not just individual touchpoints,” summarizes Jesper Damsgaard, senior vice president of e-commerce at jewelry brand Pandora.
In summary, the study shows that European e-commerce companies are faced with the challenge of radically adapting their business models to these five shifts in order not to lose out in the intensified global competition. Success in this new reality depends largely on how quickly organizations advance the networking of their data and implement AI as a central operating system. Only those who manage to seamlessly feed both the customers’ autonomous algorithms and their own internal processes with precise data will be able to grow profitably in the long term in a market that is increasingly organized by machines for people.
