• by Laurie Sullivan , January 8, 2026

Microsoft has unveiled new AI-powered agentic features that automate all areas of retail.

These intelligent agents announced Thursday -- ahead of The National Retail Federation (NRF) conference next week -- mark a turning point in the era of agentic AI, giving retailers tools to anticipate change, operate more efficiently, and deliver experiences that reflect their brands.

Merchandising, marketing, store operations, and fulfillment are all processes these agents carry out, taking brands through processes from buying to marketing to checkout.

“Retailers who thrive will be the ones who unify their business with intelligence that reaches every corner of the value chain,” said Kathleen Mitford, corporate vice president of global industry at Microsoft.

AI has changed the way consumers shop. Adobe reported that AI-driven ecommerce traffic during the 2025 holiday season rose by more than 693% compared with 2024. This type of growth underscores the significance of combining a seamless checkout process.

Microsoft “Copilot Checkout,” introduced today, will enable merchants in the U.S. to help consumers complete the purchase process without being redirected to external sites.

Retailers remain the merchant of record, while PayPal, Shopify, and Stripe complete the financial transaction. Agentic turns search and discovery on retail sites into conversions.

Etsy sellers now have access to Copilot Checkout, with many more retailers joining soon. “With one integration, we open the door for our seller to show up across new surfaces without extra work,” said Rafe Colburn, Etsy chief product and technology officer.

Shopify merchants will automatically be enrolled, but there is an opt-out feature. This is the modern power of agentic storefronts, according to Mani Fazeli, vice president of product at Shopify.

Fazeli said that with Copilot Checkout, customers can move from intent to transaction in seconds without leaving the conversation, adding that it is "the merchant’s checkout powered by Shopify." 

“Brand Agents,” an agentic commerce feature, is now available for merchants on the Shopify platform, and the personalized shopping agent template in “Copilot Studio.”

Both features enable personalized, conversational shopping experiences, helping retailers guide customers, boost engagement and drive conversions.

The chatbot agents enable brands to bring their authentic voice into every digital interaction on their website, because the large language models are trained on a brand’s product catalog. In this instance, the agents answer detailed product questions and engage shoppers on Shopify in natural, brand-aligned conversations. The brands can install this with minimal setup.

The personalized shopping agent template provides a customizable framework for retailers.

In addition to real-time, context-aware product discovery and recommendations across web, mobile, and in-store experiences.

Advanced capabilities include outfit building and more, giving retailers the flexibility to craft unique and engaging shopping journeys.

Microsoft also launched what it calls a “catalog enrichment agent template” in public preview -- described as an intelligent assistant that extracts product attributes from images, adds information from social insights, and automates catalog tasks such as product onboarding, categorization, and error resolution.

The technology aims to act as a template to convert product data into structured data that helps consumers find what they need, as well as product recommendations across channels.