What does Google Ads change in 2026 for AI shopping — and should UK retailers worry

Google Ads is moving beyond clicks and impressions into direct transactions, after Google announced a new commerce infrastructure that allows shoppers to discover products, receive offers and complete checkout inside Google Search and its Gemini AI app.

The move follows Google’s official product launch on 11 January 2026, in which the company unveiled a new open standard and a set of AI-powered shopping tools designed to turn Google’s AI surfaces into full retail environments. This is reported by The WP Times, citing Google’s official announcement. Google said the change is being driven by what it calls “agentic commerce” — a model in which artificial intelligence systems do more than recommend products and instead carry out actions on behalf of users, including comparing options, applying discounts and completing payments.

At the centre of the new system is the Universal Commerce Protocol (UCP), which Google describes as “a new open standard for agentic commerce that works across the entire shopping journey — from discovery and buying to post-purchase support.” According to Google, UCP establishes “a common language for agents and systems to operate together across consumer surfaces, businesses and payment providers,” allowing any compatible AI agent to interact with retailers without the need for individual integrations.

Google said the protocol is designed to work across multiple industries and is compatible with existing standards, including Agent2Agent (A2A), Agent Payments Protocol (AP2) and Model Context Protocol (MCP), ensuring that AI-driven shopping can function across different platforms, apps and payment networks.

What Google actually announced — the confirmed facts

Google says it has launched the Universal Commerce Protocol (UCP) as a new open standard designed to allow artificial intelligence systems and retail platforms to operate across the full shopping journey, from product discovery and checkout to post-purchase support.

In its 11 January announcement, Google said UCP creates “a common language for agents and systems to operate together across consumer surfaces, businesses and payment providers,” allowing AI-driven shopping tools to work without needing separate integrations for each retailer or platform. The company said UCP is designed to operate across multiple industries and verticals and is compatible with existing industry standards, including Agent2Agent (A2A), Agent Payments Protocol (AP2) and Model Context Protocol (MCP), enabling AI agents, payment systems and retail platforms to interact using shared technical rules.

Google also confirmed that UCP will power a new embedded checkout feature inside AI Mode in Google Search and the Gemini app, allowing shoppers to complete purchases directly inside Google’s AI interfaces.

The first rollout will cover eligible US retailers, with global expansion planned in the coming months. Google said checkout will run through Google Pay, using payment methods and shipping information stored in Google Wallet, and that PayPal will be added as an additional payment option.

Crucially, Google said retailers will remain the “seller of record”, meaning the merchant — not Google — continues to control pricing, fulfilment, customer service and regulatory compliance, even when the transaction takes place inside Google’s AI environment.

What is confirmed so far

• UCP was formally launched on 11 January 2026 as an open commerce standard.
• AI Mode and Gemini checkout will go live first for eligible US retailers, with international rollout to follow.
• Google Pay will be the primary payment method, with PayPal added shortly after launch.
• Retailers remain the seller of record — Google is providing the transaction layer, not becoming the merchant.

Who is backing UCP — and why it matters

Google says the Universal Commerce Protocol was co-developed with Shopify, Etsy, Wayfair, Target and Walmart, and is supported by more than 20 major companies across retail, payments and commerce infrastructure.

The list of companies that have formally endorsed or integrated with UCP includes Adyen, American Express, Best Buy, Flipkart, Macy’s, Mastercard, Stripe, The Home Depot, Visa and Zalando, giving the protocol backing across both global retail and the world’s dominant payment networks. The breadth of that support matters because it signals that UCP is not a niche Google experiment, but a cross-industry infrastructure layer that could become the technical standard for how AI-driven shopping works.

Separately, reporting from the National Retail Federation (NRF) conference in New York described Google’s announcement as part of a wider push to embed “shopping within Gemini”, with large retailers including Walmart and Wayfair among the first partners, initially for the US market.

What this signals for UK retailers and advertisers

For businesses selling into the UK and Europe, the list of backers is a key indicator of where the industry is heading.

• Standards backed by Visa, Mastercard, Stripe and major retailers tend to become default rails for digital commerce, in the same way that card networks and Apple Pay rapidly became global infrastructure.
• If discovery, comparison and checkout increasingly take place inside AI interfaces rather than on retailer websites, the competition shifts from winning clicks to being selected by the AI agent that is acting on the customer’s behalf.
• In that environment, product feeds, structured attributes and commercial rules — rather than just bid levels — become decisive.

The “checkout inside Google” model — what changes operationally

Google’s description of the system is explicit: shoppers researching on Google will be able to discover products, receive offers and complete checkout directly inside AI Mode in Search and the Gemini app. The company says the feature is built “with security at its core” and uses Google Pay and Google Wallet to handle payment credentials and delivery details, reducing friction and lowering the risk of abandoned baskets. PayPal confirmed separately that it is supporting the Universal Commerce Protocol and that its payment system will be added to Google’s AI checkout shortly after launch, allowing users to pay through PayPal inside Gemini and AI Mode.

Practical implications for UK e-commerce teams

For British retailers and advertisers, this creates a very different operating model:

• Fewer website visits, but higher-intent traffic. Customers may never reach your product page if the purchase is completed inside Google’s AI layer.
• Machine-readable commerce becomes critical. Delivery rules, return policies, product variants, subscription terms and discount logic must be clearly structured in feeds and Merchant Center data, because AI systems cannot interpret ambiguity.
• Brand trust moves upstream. When customers do not browse your site before paying, reputation, reviews, product accuracy and fulfilment reliability become part of the AI’s decision-making about whether to surface your offer at all.

Business Agent — branded AI chat on Search

Google also announced Business Agent, a new tool that allows shoppers to chat with retailers directly inside Google Search, effectively turning the search results page into a live sales channel. Google describes the system as “a virtual sales associate” that answers questions in the brand’s own voice, helping shoppers compare products, understand features and make purchase decisions at the moment of intent.

The company said Business Agent will go live “starting tomorrow” with retailers including Lowe’s, Michael’s, Poshmark and Reebok, with eligible US merchants able to activate and customise the tool through Google Merchant Center.

Google said the system is designed to expand rapidly. Retailers will be able to:

• Train the agent on their own product data
• Access new customer insight dashboards
• Promote related and complementary products
• And enable direct purchases, including agentic checkout, within the chat itself

This effectively turns Google Search from a comparison engine into a fully interactive sales floor.

What retailers should prepare now

Even before Business Agent reaches the UK and EU, Google’s requirements are clear. Brands that want to appear in AI-driven shopping conversations will need to operate with machine-ready product truth.

Retailers should be preparing:

• A definitive product knowledge base
  Materials, sizing, compatibility, care instructions, warranty terms and restrictions must be unambiguous.
• A brand-safe AI tone guide
  What the agent is allowed to say, what it must avoid, and when a human or customer service channel must be triggered.
• Fast update pipelines
  Prices, stock levels, delivery cut-offs and discontinued items must be synchronised quickly — because AI agents act on real-time data.

Merchant Center changes — the part that will decide who wins

Google confirmed it is rolling out “dozens of new data attributes” inside Merchant Center to support discovery in AI Mode, Gemini and Business Agent. Unlike traditional search, these attributes go far beyond keywords. They include:

• Answers to common product questions
• Compatible accessories
• Alternative or substitute products
• And other structured signals that help AI understand what a product is actually for

Google said the new attributes will launch first with a small group of retailers before being rolled out more widely. For advertisers, this is the quiet but decisive battlefield. The better your structured product data, the more likely Google’s AI is to surface your offer when someone expresses buying intent.

Feed upgrade priorities

• Variant mapping (size, colour, model)
• Compatibility and “works with” relationships
• Returns, warranty and conditions of sale
• Accurate availability and delivery promises
• FAQ-style attributes where supported

Direct Offers — Google Ads puts discounts inside AI Mode

Google also announced Direct Offers, a new Google Ads pilot that allows advertisers to present exclusive, AI-triggered discounts directly inside AI Mode in Search. Instead of bidding for a click, advertisers submit offer rules — for example, “20% off this rug this week” — and Google’s AI decides when that deal is relevant enough to be shown to a shopper who appears ready to buy. Google said the pilot will initially focus on discounts, but will expand to include:

• Bundles
• Free shipping
• And other value-based incentives

Early collaborators named by Google include Petco, e.l.f. Cosmetics, Samsonite, Rugs USA and Shopify merchants.

How to think about Direct Offers

This is not just another ad format — it is a new commercial shelf inside Google’s AI layer.

• It is no longer just about CPC, but about value at the moment of intent.
• Offers must be tightly governed — with clear margins, exclusions and expiry rules.
• Redemption and returns policies must be explicit, because disputes will happen after AI-driven purchases.

Table — what’s live, what’s coming and what’s still a pilot

What UK retailers should do this week

If you sell online and rely on Google Ads or Shopping traffic, assume this model will reach the UK after the US learning phase.

A newsroom-style 48-hour plan

1. Audit your Merchant Center feed — disapprovals, missing fields, variant errors.
2. Write a one-page policy digest — delivery, returns, warranty, cancellations.
3. Define offer rules — which SKUs can be discounted, by how much, and when.
4. Build your brand Q&A — 50 real customer questions answered clearly.
5. Prepare for attribution disputes — customers may never reach your website.

And the strategic decision that cannot be avoided: Will you treat Google’s AI checkout like Amazon — a powerful but controlled marketplace — or as an extension of your own direct-to-consumer channel?

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