Etsy (ETSY) will likely be the biggest beneficiary of OpenAI’s decision to scale back its Instant Checkout functionality, BTIG’s Marvin Fong says, as the company was the most vulnerable to “agentic disintermediation.”
This week, OpenAI (OPENAI) said it was moving Instant Checkout out of the ChatGPT app and routing purchases back to the sellers’ app, a development that was immediately celebrated by online retailers, OTAs, and online vehicle marketplaces, and even shoppers who saw little difference between buying directly from the retailer or through Instant Checkout.
“We believe ETSY is the most vulnerable [to Instant Checkout] because it doesn’t touch the product like Amazon or MercadoLibre do, and therefore, can’t offer perks like accelerated delivery or easy returns,” Fong says. With Instant Checkout de-emphasized, “ChatGPT has become much more like any other distribution channel for ETSY, little different from paid search or social.”
“With consumers needing to use the Etsy app, disintermediation risk falls dramatically and loyalty should remain intact,” he adds.
Fong is also bullish on MercadoLibre (MELI) as the OpenAI (OPENAI) news reinforces his confidence in the company’s ability to maintain customer loyalty.
“Even though we viewed the risk of agentic disintermediation for MELI as low due to its fulfillment network and fintech integration, we believe AI has been a significant investor concern over MELI.”
On the other end of the spectrum is RealReal (REAL) given its proprietary supply, which ChatGPT couldn’t bypass.