Microsoft propels retail forward with agentic AI capabilities that power intelligent automation for every retail function

Built for the full retail value chain, Microsoft's agentic AI streamlines critical workflows to accelerate decisions and outcomes by augmenting human expertise across the enterprise

REDMOND, Wash., Jan. 8, 2026 /PRNewswire/ -- Microsoft Corp. on Thursday announced agentic AI solutions designed to bring intelligent automation to every part of the retail business. These new capabilities help retailers move faster, serve shoppers with greater relevance, and operate with resilience and efficiency, delivering a modern foundation for growth in a highly competitive market.

Across merchandising, marketing, store operations and fulfillment, these solutions bring a connected layer of intelligence that transforms fragmented workflows into coordinated execution. By equipping teams with context-aware tools that can anticipate and act, Microsoft is accelerating the industry's move toward a unified, intelligence-driven operating system built for the pace of modern retail.

"The retailers that thrive will be the ones that unify their business with intelligence that reaches every corner of the value chain," said Kathleen Mitford, Corporate Vice President of Global Industry at Microsoft. "With Microsoft's agentic AI, retailers can automate what slows them down and amplify what sets them apart, enabling faster decisions and stronger customer relationships while building operations ready for whatever comes next."

Turning inspiration into action with agentic commerce
AI is significantly changing how consumers shop for gifts. Adobe unveiled that AI‑driven ecommerce traffic for the 2025 holiday season has surged by 693% compared to 2024. This increase illustrates the importance of connecting authentic brand engagement with frictionless checkout, helping retailers capture value at the exact moment of intent. 

Copilot Checkout will enable merchants to reach shoppers as they complete purchases discovered directly within Copilot without being redirected to external sites. Copilot Checkout turns conversations into conversions — instantly. No redirect, no friction, and merchants stay the merchant of record. Copilot Checkout is now available in the U.S. on Copilot.com. Trusted partners enabling this experience include PayPal, Shopify and Stripe. Shoppers will be able to purchase from leading retail brands such as Urban Outfitters, Anthropologie and Ashley Furniture, and discover unique and handmade items from Etsy sellers with many more joining soon. 

"At Etsy, our job is to make it simple for people to discover the special things our sellers create. By bringing Etsy's unique inventory to Copilot Checkout, we're meeting buyers at the moment intent becomes action," said Rafe Colburn, Chief Product and Technology Officer at Etsy. "With one integration, we open the door for our sellers to show up across new surfaces without extra work. It's a straightforward way to connect their creativity to high-intent buyers — and to keep commerce human as shopping evolves."

Shopify merchants will automatically be enrolled in Copilot Checkout following an opt-out window. "Copilot Checkout can move a customer from intent to transaction in seconds, all without leaving the conversation. It's the merchant's checkout powered by Shopify, seamlessly fitting into the customer's experience," said Mani Fazeli, VP of Product at Shopify. "This is the modern power of Agentic Storefronts: personalization and relevance, trust and accuracy, speed and convenience."

Merchants wanting to onboard using PayPal or Stripe can apply here.

Driving loyalty and conversions through intelligent shopping agents
Microsoft is introducing two solutions that bring agentic commerce to life across the digital experiences retailers own: Brand Agents, now available for merchants on the Shopify platform, and the personalized shopping agent template in Copilot Studio. Both enable personalized, conversational shopping experiences, helping retailers guide customers, boost engagement and drive conversions.

Brand Agents is a turnkey solution for brands to bring their authentic voice into every digital interaction on their website. Trained on a brand's product catalog, it answers detailed product questions, engages shoppers in natural, brand-aligned conversations, and is ready for Shopify customers to deploy with minimal setup. 

The personalized shopping agent template provides a fully customizable framework for retailers wanting to tailor experiences more deeply. In addition to real-time, context-aware product discovery and recommendations across web, mobile and in-store experiences, it includes advanced capabilities such as outfit building and more, giving retailers flexibility to craft unique engaging shopping journeys. 

"Microsoft's personalized shopping agent template gives us a flexible foundation to explore AI-powered guidance in a way that fits our brands, improves the customer experience and helps customers get inspired," said Jenny Jidborn, IT Manager at Kappahl Group. "It supports our ambition to improve conversion while also reducing returns through better decision support at the product level — ultimately helping customers feel more confident and satisfied with their choices."

Enabling smarter discovery and recommendations through catalog enrichment 
Microsoft is also launching in public preview the catalog enrichment agent template in Copilot Studio, an intelligent assistant that extracts product attributes from images, enriches them with social insights, and automates catalog tasks such as product onboarding, categorization and error resolution. Serving as a foundation for agentic commerce and a new lever for merchants, this customizable template transforms product data into enriched, structured data that fuels discovery, recommendations and hyper-personalized shopping experiences across channels. 

"With Microsoft's catalog enrichment agent template forming the backbone of our personalized shopping experiences, we can turn product details into meaningful insights that help shoppers discover styles in real time, receive tailored recommendations and explore complete looks," said David Torrecilla, Head of Innovation at Guess. "It's a powerful step forward in our commitment to delivering service that's as dynamic as our brand." 

Empowering store associates and streamlining store operations for faster service and better customer experiences
Retailers continue to grapple with high turnover and a shortage of skilled frontline staff. Many employees lack access to digital tools that could help them serve customers more effectively and efficiently. Microsoft's new agentic AI solution is designed to change that by empowering employees with intuitive, on-demand assistance. 

Store operations agent template in Copilot Studio, now in public preview, empowers store leaders and associates with a natural language interface for quick answers on inventory availability and store policies, while autonomously orchestrating workflows, flagging exceptions and recommending next best actions. By analyzing internal signals like sales trends and foot traffic alongside external factors such as weather, local events and holidays, it delivers contextual recommendations for staffing, KPIs and operational priorities. The intelligent agent helps leaders make smarter, faster decisions. 

"With the store operations agent template, we're advancing our AI strategy by enabling teams to act on live store insights," said John Khoury, Group CTO at Strandbags. "The flexibility to shape the agent around our specific needs ensures our teams can focus on delivering exceptional service while we stay ahead in a fastmoving retail world." 

Microsoft's new agentic AI solutions mark a turning point in the era of agentic AI for retailers, giving them the tools to anticipate change, operate more efficiently and deliver experiences that truly reflect their brand values. Intelligent agents help automate critical retail workflows from inventory management and product onboarding to real-time merchandising insights, freeing teams to focus on strategy and innovation while driving measurable business outcomes. By combining deep enterprise integration with responsible innovation, Microsoft is helping retailers build stronger businesses and lasting customer relationships for the future. 

Start by exploring retail agent solutions in Microsoft Marketplace and learn more about Microsoft for Retail here. To experience these solutions in action, visit Microsoft and its customers and partners at NRF 2026 at booth #4503. 

Microsoft (Nasdaq "MSFT" @microsoft) creates platforms and tools powered by AI to deliver innovative solutions that meet the evolving needs of our customers. The technology company is committed to making AI available broadly and doing so responsibly, with a mission to empower every person and every organization on the planet to achieve more.

SOURCE Microsoft Corp.