What: ChatGPT is driving significant referral traffic to Walmart and other retailers, while Amazon restricts AI access to protect its advertising revenue.

Why it is important:  The embrace of AI by Walmart and resistance by Amazon reflect broader trends in retail innovation and risk management.

The debate over whether ChatGPT is helping or hurting Amazon and Walmart reflects a broader transformation in retail, as AI-driven referral traffic begins to reshape how consumers discover and purchase products online. Recent studies from October 2025 indicate that while ChatGPT is generating increasing referral traffic for major retailers, conversion rates remain low compared to traditional channels, underscoring persistent barriers to AI adoption. Walmart’s strategic embrace of AI, highlighted by its landmark partnership with OpenAI and the rollout of features like Instant Checkout, positions it at the forefront of this shift, leveraging AI-generated traffic to enhance both online and in-store experiences. In contrast, Amazon’s protective stance toward its advertising-driven business model reveals concerns about the potential erosion of high-margin ad revenue if consumers migrate their product searches to AI chatbots. Industry analysis from November 2025 underscores the urgency for retailers to adapt their digital strategies, as the rise of agentic commerce and AI-mediated shopping journeys threaten to upend established models of customer acquisition and engagement. The contrasting approaches of Amazon and Walmart illustrate the divergent paths retailers may take as they navigate the opportunities and risks of an AI-first retail environment.

IADS Notes:  The debate between Amazon and Walmart over ChatGPT’s role in retail mirrors broader trends observed in the past year. In November 2025, the Financial Times highlighted how generative AI is shifting power from traditional e-commerce to AI platforms, raising concerns about data and customer relationships. Walmart’s October 2025 partnership with OpenAI for Instant Checkout demonstrates proactive adaptation, while September 2025 analysis from Inside Retail emphasizes the urgency for brands to optimize for AI-driven discovery. Despite these innovations, October 2025 research from Digiday notes persistent challenges with conversion rates and consumer trust, and August 2025 coverage from Modern Retail raises questions about market fairness as AI becomes a direct sales channel.

Is ChatGPT helping or hurting Amazon and Walmart? They disagree