August 8, 2025
5 min read
PYMNTS
Amazon and Walmart Battle to Lead AI-Powered Retail Super Agents
Amazon and Walmart are engaged in a two-front competition to dominate the future of retail by leveraging artificial intelligence and logistics innovation.The Two Fronts: Software and Logistics
One front focuses on software: building the smartest AI agents capable of guiding and automating shopping behaviors. The other front is logistics: delivering products faster, cheaper, and more conveniently. Retail is evolving beyond traditional eCommerce and omnichannel strategies toward intelligent, adaptive commerce ecosystems. These ecosystems anticipate customer intent and optimize logistics in real time using AI.Agentic AI as a Growth Engine
Amazon envisions "agentic AI" — autonomous software agents acting on behalf of users — as a key driver of future growth. These AI agents, treated as enterprise customers, use AWS tools to automate retail transactions. CEO Andy Jassy highlighted during the Q2 earnings call that enterprise AI agents will increasingly shape demand across Amazon’s platform. This shift means retailers must build infrastructure to support agent-to-agent commerce, where a consumer’s AI assistant interacts directly with retailer inventory bots, pricing APIs, and promotions engines to complete purchases in milliseconds. Amazon is also protecting its ecosystem by updating website code to block AI shopping tools from Google, Perplexity, Anthropic, and OpenAI from crawling product listings. Advertising will also evolve, with AI determining the context and timing of ads, enabling new formats like sponsored prompts, dynamic AI conversations, and predictive product placements. Meanwhile, Walmart is rolling out its own unified suite of AI "super agents" designed to serve customers, employees, suppliers, and developers. Walmart aims for eCommerce to represent half its sales within five years, relying heavily on AI to fuel this growth.AI and Logistics: The New Competitive Moats
Traditionally, retail power came from scale, supplier relationships, and shelf space. Now, data flywheels, AI model quality, and fulfillment responsiveness are the new sources of competitive advantage. Retailers that gather richer context across devices, verticals, and behaviors can train better AI models, generate deeper intent signals, and offer more compelling shopping experiences.Same-Day Delivery: The Summer Sales Battleground
A July PYMNTS Intelligence report found Walmart outperformed Amazon in same-day delivery during Prime Week. Among grocery-only customers, 48% used Walmart’s same-day delivery versus 36% for Amazon. For combined grocery and non-grocery orders, Walmart led with 41% same-day delivery compared to Amazon’s 29%. Additionally, 21% of Walmart’s grocery shoppers chose in-store or curbside pickup, an option used by fewer than 2% of Amazon’s grocery shoppers. This highlights Walmart’s omnichannel advantage due to its extensive store network and fulfillment strategy. Walmart’s hybrid model—mixing store fulfillment, curbside pickup, and home delivery—gives it an edge in instant convenience. Amazon relies more on centralized home delivery. However, Amazon’s delivery innovations could accelerate with new U.S. Department of Transportation regulations allowing drone operations beyond visual line of sight, potentially enabling large-scale commercial drone deliveries. Amazon aims to deliver 500 million packages annually by 2030, and this regulation is critical to scaling that vision.The New Retail Operating System
Ultimately, Amazon and Walmart are building a new retail operating system where AI is the core organizing principle, not just an accessory. This system integrates smarter shopping agents and faster, AI-optimized logistics to redefine commerce.For comprehensive AI and retail insights, subscribe to the PYMNTS AI Newsletter.
Source: Originally published at PYMNTS on August 8, 2025.