Google has attempted, but failed, to replicate Amazon.com Inc's online selling and delivery services. The company is committed to disrupting the e-commerce industry under new Senior Vice President Prabhakar Raghavan, a market that is expected to reach $6,090 billion by the end of 2022 and the business that Alphabet Inc. has attempted and failed to enter many times earlier.
What went wrong?
In 2013, Google debuted 'Shopping Express,' a delivery service with a handy app and the promise of shipping goods on the same day, with the support of big retail partners including Target Corp and Walgreens. The service platform appeared to be a logical competitor to Amazon, with an annual subscription model similar to Amazon Prime. But it was never the case. Due to the lack of client appeal, Shopping Express was only able to grow to a few cities in the United States. Managerial hesitation and reluctance to invest extensively in the low-margin division jeopardized Shopping Express’s global expansion. To make matters worse, in 2015, Europe filed a huge anti-monopoly lawsuit against Google, alleging that the search engine favored its own shopping service over rivals. As a result, the corporation was forced to make changes.
What has changed?
Many new capabilities have been presented by Google in the hopes of persuading users to buy directly from their page, nudging vendors to pay more for Google advertisements. One of the new capabilities allows users to use images to search for local retail products or find anything in the physical world with the single click of a camera. Besides, the firm developed a tool that allows users to move directly from merchant listings on Google to their checkout pages with just one click.
Amazon in Trouble?
For Amazon, which built a booming business by essentially renting its digital real estate to small sellers, the risk is that Google could give those brands a pathway to thrive outside its designated marketplace. That could force the Seattle-based company to more aggressively court sellers with discounts on fees, advertising, or logistics services.
Outlook
As customers return to their pre-pandemic habits, Google's reinvigorated foray into e-commerce coincides with a slowdown in online purchasing. Both Amazon and eBay Inc have announced slow growth and bleak profit forecasts. Historically, Google has always sought to make its technology fade into the background. As Google dives into the front end of online retail, the coming months will be a test of how the market reacts to the new capabilities, as well as how the competition responds.
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