The lack of standardized agentic frameworks is complicating investment decisions in the retail sector. While major retailers are gearing up for a future centered around AI-driven shopping experiences, smaller merchants are calling for a more straightforward approach.
Maran Nalluswami, Executive Vice President and Chief Strategy and Business Development Officer at Synchrony, emphasizes the importance of remaining cautiously vigilant amidst this uncertainty, referring to it as “a dose of healthy paranoia.” In a recent interview with PYMNTS, he discussed how companies can overlook critical shifts in their industries when they fail to recognize changing rules in time.
Nalluswami clarified that this paranoia does not mean chasing every emerging technology blindly. Rather, it serves as a prompt to stay attuned to substantial changes in the market and thoroughly assess these shifts before allocating any resources. “A knee-jerk reaction is not advisable,” he noted, encouraging a thoughtful approach that involves listening to merchants, consumers, employees, and external experts to validate whether changes are genuine.
The evolving landscape of agentic commerce is testing these strategies rigorously. “Agentic commerce, where agents handle shopping tasks for consumers, is unprecedented,” Nalluswami pointed out. Unlike gradual shifts in payment technologies and currency, this new form of commerce is entering the industry at an accelerated pace.
The implications for businesses begin with how products are discovered. Initial thoughts among larger retailers were that AI shopping capabilities would primarily be integrated within their own platforms. However, as consumers increasingly turn to third-party AI tools for product research, this has necessitated a reevaluation of strategies. The challenge lies in ensuring that payment solutions can seamlessly accompany consumers across different environments beyond the merchants' immediate reach.
As it stands, many consumers utilizing AI for research tend to finalize their purchases on different platforms, such as a retailer's website or in brick-and-mortar stores. This raises questions about how long this divide between product discovery and transaction will last. “Currently, you have to bet on every aspect of the consumer experience because no single player has secured dominance yet,” Nalluswami explained.
The approach to AI adoption varies significantly between large and small merchants. Bigger retailers can communicate with their payment partners, articulating the necessity for product offerings and financing options to align with consumers’ shopping preferences. Their resources and technical capabilities allow them to explore how they can adapt product catalogs and payment workflows across new AI environments.
In contrast, smaller businesses—such as local retailers, veterinarians, or jewelers—prioritize ease of use above all else. For these merchants, the main concern is whether technology can simplify transactions without introducing complexity. This situation poses a challenge for payment providers, as they must cater to the experimentation of larger retailers while still offering user-friendly solutions for smaller enterprises without requiring extensive technical infrastructure.
Trust plays a pivotal role in this evolving marketplace. The introduction of AI means consumers may depend on automated agents to help them find products, compare options, and select payment methods—all while merchants need to maintain confidence that their offerings are accurately represented. Consumers, too, require assurance regarding the security of their transactions and personal data.
Additionally, changing consumer loyalty is informed by different discovery channels, especially for younger shoppers who may rely on social media recommendations rather than loyalty to specific retailers. As a result, the source of these recommendations can influence the overall commercial relationship.
Nalluswami believes payments have reached a pivotal moment, but he asserts that the opportunity for adaptation is still available. Wallets and processing ecosystems may gain significance, as stored payment information can facilitate transactions across various merchants without requiring the consumer to re-enter their card details. The dynamics of these systems could also affect which payment options are available at the point of sale.
While Nalluswami does not believe that the pace of change is so rapid that businesses cannot adapt, he stresses the importance of being proactive in anticipation of evolving trends.
