Etsy pops 13% as OpenAI announces ChatGPT Instant Checkout for the shopping site

OpenAI on Monday announced Instant Checkout, a new feature that allows users to buy products through its artificial intelligence chatbot ChatGPT. 

Instant Checkout initially supports single-item purchases directly from U.S. Etsy sellers, and it’s available to U.S. ChatGPT Plus, Pro and Free users. OpenAI said more than one million Shopify merchants, including Skims and Glossier, are coming soon. 

Shares of Etsy rose more than 13% on Monday. Shopify’s stock popped more than 5%.

OpenAI will take a fee from transactions that are completed through ChatGPT, which means Instant Checkout could become an important new revenue stream for the startup. OpenAI is not yet profitable, and is burning through cash as it works to scale up its computing infrastructure. 

The company declined to share specific details about how large the fees are since they are determined through confidential contracts with Etsy and Shopify. Instant Checkout is free to users and will not affect their prices, OpenAI said. 

“Our vision for ChatGPT – and a lot of the technology we create, but especially ChatGPT – is that it’s not just providing you information, it is also helping you get things done in the real world,” Michelle Fradin, OpenAI’s product lead for ChatGPT commerce, told CNBC in an interview. 

The company plans to introduce multi-item carts and expand the regional availability of Instant Checkout going forward. 

OpenAI has been pushing deeper into e-commerce in recent months and introduced product recommendations as part of its search experience in April. ChatGPT surfaces products from across the web, and the results are ranked by relevance to the user and not influenced by partnerships with OpenAI, Fradin said.

Following the launch of Instant Checkout, if users are browsing and come across a product from an Etsy seller, for instance, they’ll be able to purchase that item directly through ChatGPT instead of clicking out to the merchant’s site.

Instant Checkout is powered by OpenAI’s Agentic Commerce Protocol, which is the underlying technology that allows users to complete a transaction directly with a merchant through ChatGPT. OpenAI built the framework in partnership with the fintech company Stripe, which powers ChatGPT subscriptions.

“If you are already a subscriber, you’re already using your card in ChatGPT, then when you go to buy something from Etsy, you don’t have to redo that work,” Fradin said.

OpenAI initially decided to use Agentic Commerce Protocol for e-commerce, but Fradin said the company thinks it could be used to facilitate other types of purchases or payments as well. OpenAI is open-sourcing the framework to help merchants build integrations more quickly, and so that developers can explore different use cases, she said. 

ChatGPT surpassed 700 million weekly active users in August, and Fradin said “a huge portion” of the questions people are asking are related to shopping and commerce in some capacity. The questions can be specific, like asking for help finding a pair of black boots, or more broad, like how to plan a birthday party for 12 kids, for instance.  

“What we wanted to do is make it even easier for users to complete their journey in ChatGPT, and for merchants and developers to convert those conversations into checkouts,” Fradin said.

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