Agentic Commerce Needs Its Febreze Moment

In the mid-1990s, Procter & Gamble claimed they had invented a miracle product that could eliminate even the most potent odors instantly. The chemist at P&G created a compound that completely eradicated bad smells, leading to the launch of Febreze. However, after investing millions in perfecting the formula, Febreze failed to become the blockbuster product P&G had hoped for.

Charles Duhigg, a Pulitzer Prize-winning author, explains in his book The Power of Habit why Febreze underperformed. The company's marketing team was confused, as they had a success story with a park ranger who used Febreze to deal with skunk odors. However, the real breakthrough came when they interviewed a woman with nine cats whose living room smelled awful, but she didn't notice the stench.

This revealed that many people could tolerate unpleasant smells in their homes without realizing it. Habits consist of a cue, a routine, and a reward. Febreze had a routine (spraying the product) but lacked a compelling cue and reward, which prevented it from becoming a habit. P&G shifted their approach by focusing on the reward, adding a pleasant scent to the product and positioning it as a final touch to a clean home.

This change led to Febreze becoming a massive success, generating over $230 million in its first year and becoming a billion-dollar business by 2011. However, P&G failed to replicate this success when they ventured into the world of AI and e-commerce. OpenAI launched Instant Checkout, promising a new habit loop for consumers: asking an AI for the best deal and buying it instantly.

However, the reward – the best offer from multiple merchants – never materialized, and the routine – shopping on Amazon – remained unchanged. Despite OpenAI's promise to onboard millions of merchants, only a few actually implemented the technology, and major players like Amazon and Meta remained hesitant to adopt it. The failure to deliver the promised reward highlights the importance of a well-rounded habit loop in driving consumer adoption.