Shopify AI Reality Check: 166 Stores, 1 Truth

Shopify just dropped more than 150 AI features. Influencers are losing their minds. People are claiming you can open a store and start earning millions in months without hiring an agency.

But what's the reality when you're actually managing 166 Shopify stores?

Meet Hitesh Matlani. He runs a 25-person agency that's been in the trenches since 2011, back when e-commerce platforms were still figuring out their identity. He started his agency during COVID when everyone said e-commerce agencies were doomed. While the rest of us are reading Shopify's press releases and watching Instagram influencers hype up sidekick and agentic storefronts, Hitesh is watching this AI rollout in real time across hundreds of merchants.

Today, we're cutting through the hype and getting the truth about what Shopify's AI actually means for merchants, developers, and agencies.

Key Takeaways: The Reality Behind Shopify's AI Hype

The Platform Wars Are Over:

• Shopify followed Apple's playbook: platform + app ecosystem = dominance
• 2 million+ stores, 12,000+ apps, and a partner network that crushed competitors
• Volusion and BigCommerce got left behind as Shopify's ecosystem became the standard

AI Doesn't Replace Strategy:

• Having all the AI tools doesn't mean you know how to use them effectively
• Agencies selling furniture (DIY implementation) will die; agencies selling interior design (strategy) will thrive
• Clients doing $5K/year and $10M/year both use AI, but mature clients understand AI can't do everything

What Actually Works:

• Timmy AI and TDI for customer service chatbots that actually convert
• Material Retail for AI-generated meta fields that improve search and filters
• AI plus human intervention is the future - automation for repetitive tasks, humans for strategy

Q: Take us back to 2011. You were selling click-to-call and click-to-chat services before Shopify even became dominant. What was that era like?

Hitesh: I landed my job as a business development representative selling click-to-call and click-to-chat services. That was on behalf of ATG, which was later acquired by Oracle. Things were different - you did not have a lot of plugins or apps that you could simply install on your website and you're done. It was not that era.

You had to actually search for software that meets your needs and have them configured through a developer. It was not a DIY approach which we have today. We used to contact enterprises and tell them we'll increase customer loyalties and all that stuff. Finally, we'd get them to purchase our services.

🔥 ChaiNet's Hot Take: E-commerce in 2011 was like building a car from scratch every time. Shopify made it IKEA. AI is making it voice-activated IKEA.

Q: What made Shopify win the platform wars?

Hitesh: The strategy that Shopify followed was almost like Apple did. They had a phone plus the app store. Similarly, Shopify has the website and you have the app store where you can install apps. Two successful companies, almost a similar story.

One of the reasons is the app ecosystem - they have 12,000+ apps. And the partner network. I met Harley Finkelstein's team in 2014 when he was just starting to expand Shopify in India. Today, I see the kind of efforts they've put in and the way they've expanded the whole partner ecosystem - it's amazing.

🔥 ChaiNet's Hot Take: Platforms don't win by being better. They win by making everyone else rich. Shopify's partner ecosystem is a printing press for agencies and app developers.

Q: You started your agency during COVID. Most people would say that was the worst time. What did you see that others didn't?

Hitesh: I was switching from one job to another. Companies were not able to predict whether they'd get more business or hire more people, so they didn't hire me. I started this slowly and realized that more and more people wanted to go online because they wanted to sell, they wanted to survive.

Shutting down their physical shops was a big pain for them. That's how the journey started. The company got registered in September 2020, and it's been 5 years. I've been continuing to help people, providing them the right kind of solutions to help them grow.

🔥 ChaiNet's Hot Take: When everyone's running away from a crisis, that's when the opportunities appear. COVID didn't kill e-commerce - it forced evolution.

Q: Shopify just released all these AI features. Are agencies dead? Is it all DIY now?

Hitesh: AI has been around for quite a bit of time, but these features are quite big. Clients can just think of a solution, type it, and get the solution into their dashboard - sidekick or any other frameworks they've launched. It comes to agencies like "does Shopify want to build more of a DIY engine, do they not want agencies?"

That's not the right thing to judge, because it's not about you getting the whole toolkit - you should be able to know how to use it. That's the main thing. If you have the experience, if you have the right skill set, then you'll be able to work with AI and make things happen the way you need it.

People do get these features with AI, but if they're not able to use it the right way, then it's not going to work.

🔥 ChaiNet's Hot Take: IKEA gives you all the furniture and instructions. Most people still call someone to assemble it. AI tools work the same way.

Q: What's the difference between agencies that will survive AI versus those that won't?

Hitesh: The agencies that are selling their services are furniture stores, and the agencies who are selling solutions or proposing solutions are interior designers. They would first understand what your needs are, understand your business objective, and then tell you these are the solutions that are right for your business. If you implement them in the right manner, it's going to provide you the right results.

If you're just trying to judge someone based on budget, it's not going to work. But if you speak to an agency and they try to ask you more questions, then provide you the pricing or a proper scope of work with the right quotation for what you're looking for, and then provide you the solution - that's the difference.

🔥 ChaiNet's Hot Take: Agencies that say "yes" to everything are roadkill. Agencies that ask "why" before "how much" will own the next decade.

Q: Do merchants use AI differently based on their revenue size?

Hitesh: It's different. Some will try to research who the right kind of agency is for AI. Someone will find out what the right solution is and then put up a job somewhere in marketplaces saying "this is what I would need done." People use AI differently for each type of business they're into or each type of solution they require.

There's no specific trend I would say between someone doing less revenue compared to higher revenue. But the clients who are doing higher revenue, they're quite mature in understanding that AI cannot do everything for them. They will have to hire someone.

🔥 ChaiNet's Hot Take: Small merchants think AI is magic. Big merchants know it's a tool that needs an operator.

Q: Give me a concrete example of a merchant who tried using AI and it failed badly.

Hitesh: I was approached by a client in Germany. He wanted to develop his website. I said okay, we can do it. Suddenly he vanished. A few weeks later, he approached me saying "I've already developed whatever was needed, I used ChatGPT to do all of that." I said very good. "But I need some tweaks to it."

I said okay, let's go on a screen-sharing call. Show me what you've done. I can see there are all sections with custom Liquid code, and each one has static HTML codes and static CSS codes from ChatGPT. I told him, "This is impossible to optimize because you've not followed any framework. You've not followed any methodology to develop the solution that's required. You've just used AI, coded HTML/CSS, and pasted it. This is very impossible to work with."

He told me, "No, you'll have to help me." I said, "We won't be able to really help you. If you need a whole theme rebuilt, definitely we can do it in the right manner."

🔥 ChaiNet's Hot Take: AI can get you to 95% on a demo. That last 5% to production requires rewriting the entire thing from scratch. Ask any engineer.

Q: What AI features are stores actually using on the storefront side that work?

Hitesh: On the storefront side, there are features like AI chatbots. We use a tool called Timmy AI that works really well. We give the AI all sorts of documents, all the understanding about the product, specifications, details, everything. The AI understands it and accordingly responds to the customer. That way you have less customer queries coming to you and more satisfied customers.

🔥 ChaiNet's Hot Take: Chatbots have existed for a decade. AI chatbots just sound less like a depressed robot from 2015.

Q: Do these AI chatbots actually increase sales conversions, or is that just marketing claims?

Hitesh: Yes, definitely they help. We did this for a store selling kegs in Australia. You can have a keg fridge at your house. You can first decide which fridge you need for the house, which fridge you need for the bar, how many kegs can fit in it, whether you need a 50L one. These kinds of questions are very difficult.

They would chat with the AI chatbot. It will recommend the right kind of fridge and it will recommend the kegs as well. Average order value went from $500 to $1,500. That's an amazing technology to use if you use it in the right manner.

But you have to keep on monitoring what answers AI is giving. They have the option in the dashboard where you can monitor what sort of answers have been given, and you can optimize and make the AI learn better.

🔥 ChaiNet's Hot Take: AI that triples your average order value isn't replacing humans. It's doing what sales associates did before retail moved online.

Q: What about meta fields? How is AI helping there?

Hitesh: There's a tool that we use called Material Retail. It connects with your catalog and generates meta fields based on the product attributes. That way, if people are searching for "shoes size 7 for men," it will deliver the right kind of results to that search because you have the right kind of meta fields and product attributes mentioned.

Meta fields help you with everything - they help with search on the website, help you filter out products, help you categorize products. Meta fields are like temporary fields or additional fields on top of the fields that Shopify allows you to have.

🔥 ChaiNet's Hot Take: Meta fields sound boring. So does plumbing. Both make everything else work.

Q: What about customer service AI? What's working?

Hitesh: For customer service, as I said, Timmy AI is the one we've been using that's worked out pretty well. TDI is also a similar chatbot that works for customer service. Gorgeous came up with their own AI version as well which is working.

People can definitely use AI when there's tedious work involved, when there's repetitive work. But people are apprehensive whether the AI would give the right kind of answers. That's what I thought as well - "Why can't I talk to a human?"

That was one of the features Shopify launched as well. They launched a human chat button on their support portal because people were not so happy with the AI search and then the human coming into the picture. So they launched a button saying "chat with the human advisor."

🔥 ChaiNet's Hot Take: Shopify built AI support, then had to add a button to escape it. Even AI companies know AI isn't ready to fly solo.

Q: Can AI predict what's going to happen with a store's data?

Hitesh: There's a tool called Angular AI. Angular AI helps you predict what's going to happen based on your past data, based on the data science understandings that they have. They also offer a data science customized service if you're going for their enterprise plan.

🔥 ChaiNet's Hot Take: Predictive AI is astrology with spreadsheets. Sometimes scary accurate, sometimes hilariously wrong.

Q: What's the future of AI in e-commerce? AI plus human, or AI replacing humans?

Hitesh: Definitely AI plus human is the future, which we're already seeing. If you have AI, human intervention is definitely required to understand what the AI has created and accordingly refine it before it gets to the public. That's where I see the whole thing going.

The repetitive tasks we're probably doing at the moment, most of them will be automated by then. You don't have to really go in and optimize your listings. AI will do that for you. Currently, some stores also do image resizing, making them into proper shapes and sizes for Facebook, then different ones for Amazon. They don't really have to get into all of that - that work will be automated.

🔥 ChaiNet's Hot Take: AI won't steal your job. It'll steal the parts of your job you hate and let you focus on the parts that require a pulse.

Q: What about AI search engines and optimization?

Hitesh: There are people getting into AI-based searches, and people are asking us to optimize their catalogs. We're implementing llms.txt for websites that would help in getting better into AI search engines.

🔥 ChaiNet's Hot Take: SEO became AEO. Next it'll be XYZ-EO. The acronyms change but the game stays the same: be useful or be invisible.

Q: Are you worried about Shopify eating away partner businesses with all these AI features?

Hitesh: There's a deep debate happening online these days. But I would say use AI wisely so it helps you in the right direction. Do take advice or solutions from the agencies you've been working with for a long time. They won't give you the wrong kind of advice.

AI is helpful for tedious tasks, but for more solution-oriented approaches, I would recommend approaching an agency.

🔥 ChaiNet's Hot Take: Platforms always threaten to eat their ecosystem. Then they realize their ecosystem is what makes them valuable. Shopify needs agencies more than agencies need Shopify.

Q: What's your advice for store owners trying to figure out AI?

Hitesh: For store owners, they're quite wise to take their own decisions. Just make sure you take the decision right. What AI provides you may be right, may not be right. If you have the right understanding that you need to really make things happen, then you just have to get it right.

Take advice from agencies who know what they're doing. Don't just jump in because someone on Instagram said you can make millions in months with AI. Understand your business first, understand what problems you're trying to solve, and then use AI as a tool to solve those problems.

🔥 ChaiNet's Hot Take: AI is a calculator, not a CEO. It'll do the math faster, but you still need to know what equation to solve.

Final Thoughts: Reality Over Hype

Hitesh's perspective: "The agencies selling furniture will die. The agencies selling interior design will survive. Having all the tools doesn't mean you know how to use them effectively."

The bottom line: Shopify's 150+ AI features look revolutionary in a press release. But managing 166 stores in the real world tells a different story. AI isn't replacing agencies - it's separating the order-takers from the strategists.

The German merchant who copy-pasted ChatGPT code into his store? That's the future of DIY without understanding. Unusable, unmaintainable, unfixable without starting over. The keg store that used Timmy AI to triple their average order value? That's AI used strategically with human oversight.

Here's what's actually happening: AI is fantastic for tedious, repetitive tasks. Meta field generation, image resizing, basic customer queries, product recommendations. It's garbage for strategy, positioning, understanding what problems your business actually needs to solve.

The stores doing $5K/year think AI is going to save them. The stores doing $10M/year know AI is a tool that needs an operator. And the agencies that survive the next five years won't be the ones implementing AI features - they'll be the ones knowing which features to implement, when, why, and how to measure if they're actually working.

Shopify didn't kill agencies with AI. They just made it obvious which agencies were furniture stores pretending to be interior designers. The ones asking "what's your budget?" are dead. The ones asking "what's your problem?" are booked solid.

Q: How can people connect with you and learn more?

Hitesh: You can find our work at avidrio.com to see what agencies look like when they evolve beyond just building websites. We focus on understanding your business, your problems, and then using the right tools - AI or otherwise - to solve them strategically.

Final words: AI features are exciting, but they're just tools. A hammer doesn't build a house - a carpenter with a plan does. Shopify's 150 AI features won't save your store if you don't understand what problems you're solving. Stop chasing features. Start asking better questions. The merchants who win aren't the ones with the most AI tools - they're the ones who know which problems are worth solving and which tools actually solve them. That's not hype. That's strategy.