Digiday covers the latest from marketing and media at the annual Cannes Lions International Festival of Creativity. More from the series →
AI recommendations are becoming the new digital shelf as people search and shop within LLM chatbots. The change has left the ad industry scrambling to determine what an ad strategy looks like without clicks, landing pages or traditional search results.
At the Cannes Lions International Festival of Creativity this year, Amazon announced what it’s calling a new ad format: Alexa+ Agentic Ads. With this framework, Amazon users see an ad and can complete a purchase all without leaving the ad — from food delivery to concert tickets. What makes it agentic is the LLM’s ability to hold what’s supposed to be a natural conversation with a customer rather than advertiser scripts and prompts to answer customer questions, said Charlotte Maines, vp of devices, content and advertising at Amazon.
These announcements — timed to Prime Day — have brands like Papa Johns pizza and The Orchard, a Sony subsidiary ticket purchasing company, signed on to beta test. (Neither Papa Johns nor The Orchard responded to requests for comment.) For now, Amazon and its beta partners are working out the kinks — things like success metrics and transaction completion rates — to prove the value of the agentic ads. Amazon would not divulge pricing.
Amazon hasn’t been shy about its AI ambitions. In May, Amazon sunset Rufus, rolling the AI-powered shopping assistant into Alexa+ to create Alexa for Shopping. This version of Amazon’s personalized AI assistant for shopping lives across Amazon Shopping app and website, and Echo Show devices.
“Amazon may have spent the past year creating competitive tension between AI and advertising,” Molly Schonthal, managing director, agentic commerce transformation at VML, told Digiday in an emailed statement. “This move suggests it’s now positioning those two businesses to compound each other’s value.”
Amazon’s news comes after Google Marketing Live in May where Google execs revealed a slew of updates that signal a shift toward an AI-native, conversational ad ecosystem. And OpenAI announced it would test ads in ChatGPT in February. Since then, the LLM has signed on its first conversion API partner with LiveRamp, expanded to the U.K. and improved ad delivery.
“The recommendation is becoming the new shelf,” Chance Chapman, evp at VML who oversees innovation, growth, retail media, marketplace and eRetail.
Marketers still have questions about this wide open space, Chapman said, like: How are recommendations generated? What signals influence those recommendations? What does impact in incrementality look like in an agent-led shopping environment?
It’s not that these LLMs aren’t seeing their fair share of ad dollars. OpenAI projects $2.5 billion in ad revenue this year, and $100 billion by 2030, according to Axios. WPP forecasts AI search ads will become the fastest growing channel in advertising. But advertisers are grappling with what they’re calling “tax.” Meaning, if a brand has a working organic strategy, they should be able to hack a search result without paying for an ad.
“The paid side of these things is only really the tax you have to pay for messing up on the organic side of it,” said Mike Feldman, svp of commerce at Flywheel.
Or as another exec, who spoke on the condition of anonymity, put it more bluntly, “If they can’t do the organic piece, they’re wasting their money on a paid piece.” It’s not that clients aren’t interested in agentic, conversational ads, the exec added, but they won’t spend until there’s a metric that replaces clicks.
“Are there other avenues that we can do without paying the tax? That’s where we’re looking at,” said the anonymous exec.
There’s also the consumer learning curve. On average, 34% of people report using AI platforms daily and 21% weekly, according to Tinuiti’s 2026 AI Trends study. At least 20% of people report never using an AI platform.
For Amazon specifically, the latest ad offerings are niche and on a smaller scale, said Joe O’Connor, senior director of innovation and growth for Amazon at Tinuiti. Still, marketers consider Amazon’s move a sign of things to come. Both platforms and marketers alike expect consumer usage to pick up and AI continues to upend the search marketplace.
“We’re just integrating with the technology that already empowers these Amazon experiences, and just allowing advertisers to participate in them in a natural way,” said Amazon’s Maines.
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