Shopify is giving its engineers free rein on AI. Here’s why

For decades, e-commerce rewarded the biggest brands that could buy their way to the top of search results. AI is changing that. Shopify COO Jess Hertz shares what Shopify’s data reveals about the agentic shopping revolution in real time, and how the company is building the infrastructure layer that makes products discoverable and purchasable by AI. Plus, why Shopify’s engineers can spend freely on AI tokens while the rest of the business world agonizes over ROI, and what it looks like when a company powering over 14% of online shopping decides to win the future or die trying. This is an abridged transcript of an interview from Rapid Response, hosted by former Fast Company editor-in-chief Robert Safian. From the team behind the Masters of Scale podcast, Rapid Response features candid conversations with today’s top business leaders navigating real-time challenges. Subscribe to Rapid Response wherever you get your podcasts to ensure you never miss an episode. Shopify just posted its, I think, fifth consecutive quarter of growth above 30%. How much of that growth is sort of stealing share to make that happen, like from Amazon or someone else, and how much is about AI? There is a lot of discussion around AI and agentic shopping, but how much business is it really? The way I think about it is really in two pieces. One is our core business, which is incredibly durable, and the second is that AI is expanding our upside. On the core business piece, the best statistic I can give you to think about this is that almost 90% of our quarterly revenue is from merchants who’ve been on the platform for over a year. That growth compounds, and it really shows how strong the business actually is. But on the agentic side, while that agentic GMV [gross merchandise value] is small, it’s definitely growing. We do have early signs that Sidekick is helping merchants sell more, and merchants who are a part of Catalog are really starting to make more money. For listeners who may not be as Shopify-versed, Sidekick is our AI-powered commerce agent that lives within Shopify. What we’re really seeing is that merchants are bringing Sidekick more and more into their business. On the Catalog piece, that’s our product layer for agentic commerce. That’s what makes products understandable, discoverable, and purchasable by AI. What we’re seeing there is that it is increasing conversion. When someone comes from an agentic channel, the conversion rate when an agent is using our catalog data is [double] compared to if it’s just using scraped data. So it’s really the combination of these persistent tailwinds in our base case and, as we enter the agentic era, even more upside. You’re building this sort of infrastructure layer for AI commerce. You have these agentic storefront integrations with ChatGPT and Gemini and Copilot, whatever. How much do you worry that the big AI platforms are going to build their own layer?