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WINNERS AND LOSERS FROM AI-DRIVEN COMMERCE

"Agentic Commerce" - a new way of online shopping enabled by generative AI - represents the next great shift in the e-commerce space, according to Morgan Stanley analysts who have selected some stocks as winners and losers.

Consumers are already using Gen-AI to discover products, says MS, with prompts like "find me a black leather jacket for under £100, size medium, delivery within the next 3 days" commonplace.

But the rest of the process is largely unchanged, with shoppers still selecting items, navigating to checkouts, and completing purchases.

It is these steps that so-called AI agents are set to take over completely, says MS, illustraing their point with an example of how an agent might step in should a consumer's size be out of stock.

"Instead of settling for an ill-fitting alternative, or waiting and checking back periodically to see if it has restocked; in an agentic commerce world, users could instruct an agent to monitor stockists of your desired garment, and when it becomes available in your size, complete the purchase and arrange delivery."

E-commerce giants are eyeing a $192 billion opportunity over the next four years, but also new challenges.

"Differentiation shifts to identity, fraud detection and optimisation as complexity rises," says MS.

Dutch payments firm Adyen ADYEN.AS is their top pick given its "unified single platform", while Mastercard MA and Visa V are to benefit as security, authentication, and fraud tools grow in importance. MS is overweight on all three.

"We see the most pressure on players where fragmented/legacy infrastructure limits their ability to differentiate, as well those that are more exposed to offline payments," says MS.

They slap an underweight rating on Italy's Nexi's and Paypal PYPL.O as a result.

(Lucy Raitano)

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