Google is expanding its role in ecommerce through AI Mode, introducing ad formats, agent-enabled checkout and automated creative tools in an effort to move shoppers from discovery to purchase without leaving its platforms.

In her third annual letter outlining the company’s direction in digital advertising and commerce, Vidhya Srinivasan, vice president and general manager of ads and commerce at Google, said the company is redesigning commercial experiences to make them “fluid, assistive and personal.”

The strategy underscores a broader shift in ecommerce. Search engines and content platforms are no longer just gateways to retailer websites. Increasingly, they are becoming transactional environments.

At the center of the push is AI Mode in Search, which moves beyond keyword-based queries to conversational prompts, visual inputs and AI-generated comparisons.

Google is using AI Mode to boost its role in ecommerce

Within AI Mode, users receive curated product recommendations tied to their queries. Google is testing a new sponsored format that highlights retailers offering those products. It labels the listings as ads but integrates them into the conversational interface. That allows shoppers to compare brands and stores in one experience.

The company also introduced “Direct Offers.” The feature that enables brands to present tailored promotions to shoppers at the point of purchase intent. These offers can include loyalty benefits, product bundles or other value-based incentives in addition to price discounts.

Google cited its own quantitative user research from late 2025. The data indicates that users found AI Mode more helpful when they could easily compare multiple brands and stores.

For retailers, the shift places greater importance on structured product data, real-time availability and pricing feeds that can be interpreted and surfaced within AI-driven search results.

Google seeks to lead in the agentic commerce space

Google is also advancing what it calls “agentic commerce.” That refers to AI systems assist with or complete transactions on behalf of users.

After launching its Agent Payments Protocol in 2025, Google introduced the Universal Commerce Protocol, or UCP, to standardize how merchants connect with AI agents across the shopping journey, including digital identity and payment authorization.

UCP-powered checkout is rolling out in the United States, allowing shoppers to purchase items from Etsy and Wayfair directly within AI Mode in Search and the Gemini app. Google said it has planned integrations with Shopify, Target and Walmart are planned.

The approach allows consumers to complete purchases inside Google’s AI Mode interface while merchants fulfill the orders.

The model could reduce friction and shorten the buying cycle. At the same time, it may prompt retailers to reassess how they manage brand visibility, customer relationships and transaction data when checkout increasingly occurs outside their own sites.

How Google plans to use YouTube to strengthen its ecommerce play

Google is also strengthening ties between content and commerce on YouTube. It described YouTube as the most-watched streaming platform in the United States for three years, citing Nielsen’s Gauge report as of January 2026.

The company plans to use AI to better match brands with creator audiences, building on its “open call” marketplace for creator partnerships. By analyzing video content and audience signals, Google aims to connect advertisers with relevant creator communities and convert viewer engagement into measurable sales.

As short-form video and creator-driven shopping expands, YouTube’s integration with Google’s advertising and commerce systems positions it as a more direct driver of ecommerce transactions.

Google is increasingly powering its ad products through Gemini 3, its latest AI model.

The company said advertiser adoption of generative creative tools accelerated in 2025, with a threefold increase in Gemini-generated assets. In Q4 alone, 70 million creative assets were generated using Gemini within AI Max and Performance Max campaigns, according to internal company data.

AI Max is designed to expand the reach of Search campaigns by identifying additional queries and placements. Google said it is unlocking billions of additional searches that advertisers were not previously reaching. It cited internal data from October 2025.

Google also said it is reworking its measurement tools to consolidate reporting and attribution into a more unified system. It said it aims to help advertisers better track performance across channels.

Srinivasan said the company’s objective is to eliminate the traditional trade-off between speed and certainty in online shopping.

For ecommerce operators, the changes signal that visibility will increasingly depend on compatibility with AI-driven systems — from structured product feeds to participation in emerging protocols such as UCP.

As search becomes more conversational and transactional, Google is positioning itself not only as a discovery platform but as a commerce layer embedded throughout the digital buying journey.

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