AI-powered shopping is transforming the holiday season, with projections showing it could drive $263 billion in global online sales, according to a Salesforce report. Consumers like Amrita Bhasin, a 24-year-old retail tech CEO, are turning to AI tools like ChatGPT, Google Gemini, and Perplexity to simplify gift shopping, save time, and discover new products. Bhasin, who once spent over 15 hours a year buying gifts, said AI has made the process faster and even enjoyable, leading to more purchases and better recommendations. The shift is significant. Adobe data shows AI traffic to U.S. retail sites surged 760% between November 1 and December 1. Shoppers using AI platforms are 30% more likely to make a purchase and 14% more engaged than those using traditional search, with sessions generating 8% more revenue. A major reason is that AI helps users find products based on context—like "best gift under $20 for a niece who loves sustainable fashion"—rather than just keywords. This change is pushing retailers to adapt. Walmart and Target have launched AI shopping assistants and partnered with OpenAI to enable purchases directly within ChatGPT. Walmart’s Sparky assistant can recommend products and even generate shopping lists for events. Target’s Gift Finder has seen thousands of users, with higher engagement and larger carts compared to last year. About 25% of Target’s searches are now conversational, not keyword-based. Meanwhile, Amazon has taken a different approach, blocking external AI bots from crawling its site and even sending a cease-and-desist letter to Perplexity AI over its shopping feature. Amazon argues it wants to protect its ecosystem and customer experience. Retailers are also overhauling their digital strategies. SEO is being replaced—or at least supplemented—by AEO, or answer engine optimization. Brands like PacSun, Glossier, and Ethique Beauty are rewriting product descriptions to answer real-world questions. Ethique Beauty, for example, created detailed blog posts on topics like “how to sleep with curly hair,” tying solutions directly to its products. That shift led to a 90% increase in AI-driven traffic. Other brands are investing in richer content, including sustainability details, fit guides, and customer use cases. Michael Wieder of Lalo said they now include phrases like “great for apartment living” or “best gifts for kids under one year old” to match how shoppers describe their needs in AI queries. Despite the promise, AI isn’t perfect. Target’s Gift Finder sometimes defaults to generic gift guides instead of specific recommendations. Diana Tan, a Seattle-based founder, found ChatGPT repeatedly suggesting black turtlenecks despite clear instructions to avoid them. “It took the joy out of shopping,” she said, preferring to browse in stores like Nordstrom Rack. Still, the trend is clear: AI is reshaping how people shop. Retailers that adapt their content, improve product data, and integrate with AI platforms stand to gain. But for now, many shoppers still value the spontaneity and discovery of traditional browsing—proving that AI is a powerful tool, but not yet a complete replacement for the human touch in shopping.