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AI to redefine traffic funnels, conversions for online marketplaces: Raymond James

Published 09/27/2024, 08:35 AM
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Investing.com -- Raymond James initiated coverage of MercadoLibre (NASDAQ:MELI) at Outperform and resumed coverage of Airbnb (ABNB) and ACV Auctions (ACVA) at Market Perform in a note Friday, predicting a transformative era for online marketplaces, driven by autonomous robotics and AI technologies.

The firm believes these advancements have the potential to significantly improve traffic funnels and conversion rates and reshape how consumers interact with mobile apps.

The analysts highlight that AI's integration in e-commerce could boost consumer engagement through improved recommendation engines and business AI chatbots.

"Only a 20-basis-point gain equates to a 10% GMV lift," Raymond James noted, reflecting how even small improvements in checkout conversion could have outsized impacts on overall marketplace growth.

In travel, AI-driven digital concierge services are expected to change the landscape, moving key players higher in the booking funnel and potentially reshuffling market share.

"The GenAI impact could reshape the travel bookings flow where digital concierge/agents offer industry constituents," they stated.

Furthermore, the firm believes the mobility sector could experience the sharpest impact, with robotaxis possibly expanding take rates by as much as 3x.

Raymond James said this would allow ride-hailing services to reduce costs significantly, broadening the addressable market.

Food delivery is another area ripe for disruption, with autonomous robots expected to increase take rates, although Raymond James noted that achieving scale economies will be key.

Raymond James initiated coverage on MercadoLibre with an Outperform rating, citing strong growth potential due to investments in fulfillment, AI, and advertising.

However, Airbnb and ACV Auctions were rated at Market Perform, with the analysts citing macroeconomic uncertainty and limited visibility into their AI-driven product roadmaps.

In terms of industry trends, penetration rates remain low in sectors like Latin American retail and U.S. auto markets, suggesting strong growth potential.

The analysts believe that the broader marketplace group, currently trading below historical valuation multiples, has room for expansion as AI becomes more integrated.

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