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Online shopping is turning into a battle between consumers and AI bots, and the digital challengers are winning.
This holiday season, “Grinch bots” — AI-driven scripts designed to manipulate online retail systems — are stealing far more than holiday cheer. Unlike past years, however, the problem is no longer confined to peak shopping periods.
New findings from World, a nonprofit digital trust and identity organization that tracks bot abuse and online fraud, warn of an ongoing, worsening trend in e-commerce driven by sophisticated, AI-powered automation. Bad bots litter websites with fake listings and scams, allowing bots to snap up deals before humans can click “add to cart” buttons.
“This isn’t just a holiday headache. It’s a structural shift in how the internet works. When 75% of consumers say the situation keeps getting worse, they’re accurately describing a broader structural, long-term issue, not just a seasonal spike,” Adrian Ludwig, chief architect and CISO at Tools for Humanity (TFH), told the E-Commerce Times.
Fake Listings, Instant Sell-Outs Erode Trust
World’s survey of 2,000 U.S. adults confirms a growing recognition that the rush to buy holiday gifts is becoming a race against AI. The organization’s World ID platform anonymously provides proof of human presence for online transactions. It highlights the need for fair opportunities in e-commerce that verify a person, not a bot, is on the other side of every purchase.
The World survey’s most significant results include:
- 66% of shoppers say they regularly find themselves competing with bots for limited products; scalper operations run sophisticated bot networks as full-time businesses
- 64% feel bots are stealing the joy from holiday shopping altogether
- 53% say they are now more likely to shop in stores rather than face bot “armies” online
Researchers warn that this shift highlights decreasing trust in e-commerce. Only 18% of consumers say they feel “very confident” in distinguishing genuine products from fakes, and 90% say it is essential to verify that they are buying from a real person.
“Holiday shopping shouldn’t leave you guessing ‘bot or not,’ where the Grinch wears silicon instead of fur,” said Trevor Traina, chief business officer at TFH.
Consumers want fairness, and that starts with knowing who, or what, is on the other side of the transaction. Proof of human verification and a human network, such as World, restores trust without invading privacy, he added.
Real Human Network Benefits E-Commerce
According to World officials, traditional online safeguards like passwords, Captcha, and firewalls fail to prevent bots from dominating sales, reselling products, or flooding sites with fake reviews. As AI-powered automation grows, so does the need for an anonymous human network and a “proof of human” system to ensure real people get fair access to products.
To that end, the human network and proof of human technology offer a new foundation for trust online. The strategy focuses on anonymous verification without sharing or revealing personal information, fair access so only humans can complete high-demand purchases, reducing bot-driven manipulation, and universal protection through verification across multiple services, creating safer, more transparent e-commerce.
Ludwig shared that e-commerce has exploded into a multitrillion-dollar market, on track to hit around $7.8 trillion in online sales in the next few years. That kind of volume has made retail sites into a constant, year-round target.
“On some sites, automated bots make up more than half of internet traffic, and about a third of all internet traffic is made up of bad bots,” he said.
A few clearly observable trends show that AI bots have an always-on buying mentality that monitors retailers’ restocks and flash sales activities minute-by-minute, not season-by-season, noted Ludwig.
He also pointed to resale and gray markets where bots systematically capture shoes, concert tickets, gaming gear, and collectibles the second they drop, then relist them at a markup.
“Fraud and abuse bots probe login pages, loyalty programs, and refund flows all year long,” he asserted.
Bot Damage Extends Beyond Holiday Sales
Online merchants suffer quantifiable, long-term financial consequences, such as infrastructure strain, skewed demand data, increased customer support costs, and lost lifetime customer value, said Jérôme Segura, vice president of threat research at DataDome. His company provides AI-driven bot protection to defend against online fraud by detecting and blocking malicious automated traffic for websites, mobile apps, and APIs.
“Infrastructure costs spiral as bot traffic inflates cloud and CDN bills. Retailers pay for every malicious request that hits their servers, essentially funding their own attacks,” he told the E-Commerce Times.
Direct fraud losses multiply through merchant fees, stolen inventory, and chargebacks, Segura added. Each fraudulent transaction costs retailers three to four times the item value, including operational overhead.
“Most insidiously, poisoned business logic from bot-driven traffic corrupts demand forecasting, inventory planning, and pricing algorithms, leading to poor decisions based on fake signals,” he explained.
Segura confirmed that the so-called Grinch bots are an escalating, year-round threat, not a seasonal problem.
“Bot attacks follow demand, not the calendar. Every product launch, concert ticket drop, limited-edition release, or gaming console restock triggers coordinated bot activity,” he said.
Outsmarting Grinch Bots Is Tricky Business
According to Segura, the infrastructure behind these attacks has become a permanent criminal enterprise. Scalper operations run sophisticated bot networks as full-time businesses, continuously evolving their tactics, investing in residential proxy networks, and deploying machine learning to defeat defenses.
He is emphatic about what is needed to short-circuit retail-hungry bots. The AI arms race requires a fundamental shift in detection philosophy.
“As AI-powered bots become technically indistinguishable from humans, the ‘bot or not’ binary becomes obsolete. Especially when you consider that not all bots are inherently bad anymore,” he offered.
AI agents can now engage in legitimate activities. Traditional detection methods that look for technical anomalies fail when bots can perfectly replicate human signatures.
“Intent-based detection is the counter-strategy. Instead of asking ‘Is this a bot?’, sophisticated solutions analyze what the user is trying to accomplish: inventory hoarding, rapid checkout automation, account enumeration, scraping patterns,” Segura detailed.
Detection methods must outflank the new generation of bothersome bots. A bot user may pass all technical authenticity checks. It is only behavioral intent that signals malicious purpose.
For example, accessing a large number of product pages within a few seconds, testing thousands of discount codes, or coordinating with 100 other “users” for simultaneous checkout are digital giveaways that defeat malicious bots.
When Digital Convenience Loses Consumer Trust
With more than half of online shoppers citing a preference for braving in-store crowds instead of tapping the Buy Now button, consumers have a new narrative. Ludwig sees trouble ahead for e-commerce.
“Retailers have spent years trying to move experiences online, but if customers feel like bots always win and humans don’t stand a chance, they’ll start to retreat to channels that feel more fair, even if those channels are slower or less convenient,” he warned.
That is a real risk for categories like sneakers, collectibles, electronics, and gaming gear. Limited releases and product drops are supposed to build loyalty and community, not push people away, he reasoned.
Digital transformation is no longer just about getting transactions online, according to Ludwig. It is about keeping people confident that online is actually a fair place to shop.
“If that trust keeps eroding, it could seriously hold back growth in some of the categories that rely on e-commerce the most,” he concluded.