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Google's e-commerce ambitions have recently been hugely successful when Walmart removed its products from Google Express and Google Shopping Actions. Photo credit: GettyGetty
A article Bloomberg announces that Walmart has withdrawn its products from Google Shopping actions service and also gave up its partnership with Google Express, raises concerns among badysts in the retail sector, that Google will now have trouble fighting Amazon in e-commerce. Bloomberg cited Walmart's move as a "coup" against Google.
It does not make sense for an badyst to say that Google is now going to fight Amazon, because that falsely badumes that Google has had some success with Amazon when it comes to e-commerce. That's not it. Amazon remains the undisputed leader in e-commerce with nearly 50% of the online sales market share.
Other articles I've reviewed have all shown a similar tone: Walmart ending its partnership with Google in terms of making its products available will have a negative impact on Google.
To date, Google has created two main platforms / programs for e-commerce:
Google Express is a Google-optimized delivery service where consumers can shop in stores such as Target, Costco, Walgreens, PetSmart and more, all from the Google Express app. Walmart was once part of Google Express, but not anymore. Consumers can choose the products from as many retailers as they wish and pay for the items via the app. The products are then delivered directly to the customer within one to three days. & Nbsp;
In a way, Google Express reminds me of the idea of JC Penney's former CEO, Ron Johnson, to open stores selling different brands and different products in each store. JC Penney. Just as Google Express uses the slogan "All your stores in one place" JC Penney had a similar idea. the concept has never succeeded for JC Penney.
Shopping Actions is a program that allows retailers to showcase their products on different Google platforms. The shopping actions allow for a frictionless shopping experience by using a shared list, a universal shopping cart and instant validation with recorded payment identification information, allowing customers to easily turn navigation into purchase.
The last point is the key, & nbsp;turn navigation into purchase. & nbsp;Instead of consumers buying a product online and immediately going to Amazon, Shopping Actions directs it to a participating Shopping Actions reseller to purchase the product. Google gets a percentage of sales generated by participating retailers. & Nbsp;
On the surface, Google Express and Shopping Actions appear to be programs capable of attracting a large number of retailers for them to subscribe to the service, which diverts consumers from their purchases on the platform. 39; Amazon. Unfortunately for Google, this is not the case. None of these programs has been able to dampen Amazon's ability to increase its market share in online sales or to increase its competitive advantage over Google and participating retailers.
Do not activate, direct
As part of my research on this topic, I have spoken to senior retail executives, consultants from leading strategy and management consulting firms, current and former Google badociates, former and former partners of Amazon. chain consulting to grocery retailers like Kroger. Each conversation was confidential so that the people I spoke to could speak freely and openly.
Before talking to my sources for this article, I had formulated the following opinion about Google's e-commerce strategy: The reason Google is struggling to compete with Amazon is not because Google can not attract retailers on its platform or because Walmart has ended its operations. partnership with Google. The reason Google is fighting is & nbsp;because he created Google Express and Shopping Actions without also engaging in physical retail. & nbsp;
Google wants to be a retail facilitator by helping retailers manage their transactions and get closer to their customers.
Starting with Google Express, a sentence I heard from different sources during the discussion on Google was: "We do not really see the value of Google Express, but we did not want to be left behind. side and so we registered.Google Express is neither strategic nor important to our business. " Comments were made by current and former leaders of companies currently using Google Express.
With regard to Shopping Actions, I do not dispute that some retailers using the program have seen an increase in the average size of a buyer's basket. However, after reviewing the program in detail, I do not see anything that could affect what Amazon is currently doing or getting close to what I know though that Amazon plans to do it until 2021. I do not pretend not that Shopping Actions does not generate at least a minimum. of the results, I claim that Shopping Actions is not comparable to Amazon's experience with its customers.
When I asked several sources if buying actions could compete with Amazon or reverse Amazon, none of my interlocutors stated power. Many have talked positively about what Google has created with Shopping Actions, but the consensus is that it's far from being an "Amazon Killer."
Do not bring knife to a shootout
I can write many words to explain why Amazon succeeds, but one word stands out from all others: aggression. Amazon is eager to develop and aggressively target the target industries and categories, such as e-commerce and grocery stores. The acquisition of Whole Foods was not just a strategic move by Amazon, it was an aggressive move to make other grocery retailers understand that Amazon was intent on becoming the leader of the company. grocery.
Amazon, the world's largest online retailer, has realized the value of owning physical stores to increase its ability to become a leader in grocery retailing. The acquisition of Whole Foods by Amazon is considered the most disruptive acquisition ever made in the retail business. Photo credit: GettyGetty
When I compare Amazon's strategy to Google's grocery store and ecommerce strategy, one thing is clear: Google has so far been unwilling to be as aggressive as Amazon and its offensive Google. . Amazon does not want to activate others, Amazon wants to lead by its own efforts. No one can question the formula of Amazon that has succeeded.
The singular goal of Google, which is to compete with Amazon in e-commerce through distribution platforms and partnerships, is a strategy that will never work. This is not just my opinion. Analysts, executives, and consultants with whom I spoke have expressed similar concerns about Google's strategy.
As we used to say in the Marines, do not bring a knife during a shootout. In the fight against Amazon, Google's strategy lacks firepower. I think the time has come for Google to move from one power shift to the other. I recommend that Google consider one of the following options:
Option 1. Acquire the market of target producers and germs
This is the option I prefer for Google, mainly because it gives Google one of the best retailers in the United States. My only complaint with Target is that it has failed to create a premium grocery service for its customers. If Google acquires Target, I think the optimal solution is for it to also acquire Sprouts Farmers Market and open Sprouts locations in Target stores. Google can also grow germs organically throughout the United States.
Another option would be for Google to sign a strategic partnership with Lidl to open locations in Target stores if Google decides not to acquire Sprouts. I think cabbages are the best option.
I also like the fact that Target owns Shipt, a market leader and delivery services sector the same day that Google can operate.
Google has no choice but to consider the fact that Amazon may view Target as a potential acquisition.
According to the financial badysts with whom I spoke, Google can use many options to acquire Target and Sprouts, including a combination of cash or an equity trading strategy. The same methodology can be applied to any of the options listed.
Option 2. Acquire Instacart
Instacart has contracts with leading grocery retailers in the United States. In addition, Instacart has documented the strengths and weaknesses of all the grocery retailers it serves. Google can use the intelligence that Instacart would bring to reinvent retail physical and online groceries. In such a scenario, I can consider acquiring retail stores (former Sears and Kmart sites, for example) or regional grocery stores. It is even possible that Google opens Instacart brand stores. Google can also use Instacart to expand into private label manufacturing and grocery distribution.
The possibilities are almost endless if Google acquires Instacart. To complete Instacart, I recommend Google to explore acquiring Boxed Wholesale.
Option 3. Acquire Costco
Like Target, the acquisition of Costco would give Google ownership of one of the best and most popular retailers today. Although currently focused on bulk sales, Google could expand Costco's reach to include grocery shopping on a much larger scale. One option to explore would be that Google also acquires Instacart.
As I said earlier in the article, Google must take a big step forward. The joint acquisition of Costco or Costco and Instacart would be considered the most disruptive acquisition ever made in retail.
This is the second option I prefer to Google, especially if Instacart is also acquired. Google could acquire Peapod instead of Instacart, but Instacart is the recommended choice.
Option 4. Acquire eBay
Originally, I had recommended Facebook to buy eBay and embed the platform in the Facebook user page of every Facebook member in order to turn Facebook into a platform for Facebook. e-commerce linking social media and commerce. A colleague from Forbes wrote about my opinion on the subject of Facebook's acquisition of eBay in this article. article.
(I think Google should seriously consider the possibility that Microsoft will expand LinkedIn to become an e-commerce platform.) I've outlined the possibility in this area. article. Google must also consider that Microsoft may decide to make a major acquisition from a retailer.)
I have spoken at conferences and written many articles for which I have recommended Google to acquire eBay. I clearly understand the value of the eBay market for Google. I estimate that the acquisition of the eBay market could cost Google as much as $ 12 billion or more.
One last comment: I do not recommend that Google copy Amazon. I recommend that Google improve its differentiation capabilities by making one or more strategic acquisitions that will significantly enhance its ability to become a retail leader.
Conclusion
The purpose of this article is to present options that will generate discussion within Google and the retail community. I've presented options but I do not claim that they are the best or only options that Google can consider.
I think it's imperative that Google have a physical retail presence. If I understand Google's desire to allow retail, I think Google can design and implement a retail strategy and ecosystem that can compete with Amazon, with retailers using Google Express and Shopping Actions. & Nbsp;Regardless of the size and current market capitalization of Google, Google should aim to generate the greatest growth for the company at any time.
Will some retailers end their relationship with Google if Google acquires Target, Costco, Kohl's or any number of retailers? Probably. However, other retailers, and in particular sellers, will be happy to take advantage of Google's platform to enable transactions and chat with Google in its own stores.
The stores will allow Google to open brand-specific stores offering customers an increased immersive experience as well as increased content, two very important items for customers. Stores are also essential for grocery sales. It is common in the retail trade that customers want to pick their own fruits, vegetables, meat, milk, eggs, dairy products and baked goods. Physical stores will allow customers to inspect and select the products they wish to buy.
I can only imagine what Google could do if he had acquired Target and Sprouts. What is certain is that Google, not Amazon, would have the advantage, because Google would surpbad Amazon in terms of the total number of grocery stores and offer its customers an experience in department stores in 1,850 locations. Shipt should allow Google to meet customer expectations for delivery, including the same day.
For the Google team, I wish the company reaches its full potential in the retail business. Activate the retail business, that is, think small. Becoming a retailer and leveraging its entire ecosystem of products to reinvent the retail business is great. You have more than enough talent at Google to get there.
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Google's e-commerce ambitions have recently been hugely successful when Walmart removed its products from Google Express and Google Shopping Actions. Photo credit: GettyGetty
A Bloomberg article announcing that Walmart had withdrawn its products from the Google Shopping Action service and its partnership with Google Express was raising concerns among retail industry badysts about Google's struggles to fight Amazon in e-commerce . Bloomberg cited Walmart's move as a "coup" against Google.
It does not make sense for an badyst to say that Google is now going to fight Amazon, because that falsely badumes that Google has had some success with Amazon when it comes to e-commerce. That's not it. Amazon remains the undisputed leader in e-commerce with nearly 50% of the online sales market share.
Other articles I've reviewed have all shown a similar tone: Walmart ending its partnership with Google in terms of making its products available will have a negative impact on Google.
To date, Google has created two main platforms / programs for e-commerce:
Google Express is a Google-optimized delivery service where consumers can shop in stores such as Target, Costco, Walgreens, PetSmart and more, all from the Google Express app. Walmart was once part of Google Express, but not anymore. Consumers can choose the products from as many retailers as they wish and pay for the items via the app. The products are then delivered directly to the customer within one to three days.
In a way, Google Express reminds me of the idea of JC Penney's former CEO, Ron Johnson, to open stores selling different brands and different products in each store. JC Penney. Just as Google Express uses the slogan "All your stores in one place", JC Penney had a similar idea. The concept never worked for JC Penney.
Shopping Actions is a program that allows retailers to showcase their products on different Google platforms. The shopping actions allow for a frictionless shopping experience by using a shared list, a universal shopping cart and instant validation with recorded payment identification information, allowing customers to easily turn navigation into purchase.
The last point is the key, turn navigation into purchase. Instead of consumers buying a product online and immediately going to Amazon, Shopping Actions directs it to a participating Shopping Actions reseller to purchase the product. Google gets a percentage of all sales generated by participating retailers.
On the surface, Google Express and Shopping Actions appear to be programs capable of attracting a large number of retailers for them to subscribe to the service, which diverts consumers from their purchases on the platform. 39; Amazon. Unfortunately for Google, this is not the case. None of these programs has been able to dampen Amazon's ability to increase its market share in online sales or to increase its competitive advantage over Google and participating retailers.
Do not activate, direct
As part of my research on this topic, I have spoken to senior retail executives, consultants from leading strategy and management consulting firms, current and former Google badociates, former and former partners of Amazon. chain consulting to grocery retailers like Kroger. Each conversation was confidential so that the people I spoke to could speak freely and openly.
Before talking to my sources for this article, I had formulated the following opinion about Google's e-commerce strategy: The reason Google is struggling to compete with Amazon is not because Google can not attract retailers on its platform or because Walmart has ended its operations. partnership with Google. The reason Google is struggling is because he created Google Express and Shopping Actions without also engaging in physical retail.
Google wants to be a retail facilitator by helping retailers manage their transactions and get closer to their customers.
From Google Express, when we talked about Google, a sentence I heard from different sources was: "We do not really see the value of Google Express, but we did not want to be left out Google Express is not strategic or material to our company. " Comments were made by current and former leaders of companies currently using Google Express.
With regard to Shopping Actions, I do not dispute that some retailers using the program have seen an increase in the average size of a buyer's basket. However, after reviewing the program in detail, I do not see anything that could affect what Amazon is currently doing or getting close to what I know though that Amazon plans to do it until 2021. I do not pretend not that Shopping Actions does not generate at least a minimum. of the results, I claim that Shopping Actions is not comparable to Amazon's experience with its customers.
When I asked several sources if buying actions could compete with Amazon or reverse Amazon, none of my interlocutors stated power. Many have talked positively about what Google has created with Shopping Actions, but the consensus is that it's far from being an "Amazon killer".
Do not bring knife to a shootout
I can write many words to explain why Amazon succeeds, but one word stands out from all others: aggression. Amazon is eager to develop and aggressively target the target industries and categories, such as e-commerce and grocery stores. The acquisition of Whole Foods was not just a strategic move by Amazon, it was an aggressive move to make other grocery retailers understand that Amazon was intent on becoming the leader in 'grocery.
Amazon, the world's largest online retailer, has realized the value of owning physical stores to increase its ability to become a leader in grocery retailing. The acquisition of Whole Foods by Amazon is considered the most disruptive acquisition ever made in the retail business. Photo credit: GettyGetty
When I compare Amazon's strategy to Google's grocery store and ecommerce strategy, one thing is clear: Google has so far been unwilling to be as aggressive as Amazon and its offensive Google. . Amazon does not want to activate others, Amazon wants to lead by its own efforts. No one can question the formula of Amazon that has succeeded.
The singular goal of Google, which is to compete with Amazon in e-commerce through distribution platforms and partnerships, is a strategy that will never work. This is not just my opinion. Analysts, executives, and consultants with whom I spoke have expressed similar concerns about Google's strategy.
As we used to say in the Marines, do not bring a knife during a shootout. In the fight against Amazon, Google's strategy lacks firepower. I think the time has come for Google to move from one power shift to the other. I recommend that Google consider one of the following options:
Option 1. Acquire the market of target producers and germs
This is the option I prefer for Google, mainly because it gives Google one of the best retailers in the United States. My only complaint with Target is that it has failed to create a premium grocery service for its customers. If Google acquires Target, I think the optimal solution is for it to also acquire Sprouts Farmers Market and open Sprouts locations in Target stores. Google can also grow germs organically throughout the United States.
Another option would be for Google to sign a strategic partnership with Lidl to open locations in Target stores if Google decides not to acquire Sprouts. I think cabbages are the best option.
I also like the fact that Target owns Shipt, a market leader and delivery services sector the same day that Google can operate.
Google has no choice but to consider the fact that Amazon may view Target as a potential acquisition.
According to the financial badysts with whom I spoke, Google can use many options to acquire Target and Sprouts, including a combination of cash or an equity trading strategy. The same methodology can be applied to any of the options listed.
Option 2. Acquire Instacart
Instacart has contracts with leading grocery retailers in the United States. In addition, Instacart has documented the strengths and weaknesses of all the grocery retailers it serves. Google can use the intelligence that Instacart would bring to reinvent retail physical and online groceries. In such a scenario, I can consider acquiring retail stores (former Sears and Kmart sites, for example) or regional grocery stores. It is even possible that Google opens Instacart brand stores. Google can also use Instacart to expand into private label manufacturing and grocery distribution.
The possibilities are almost endless if Google acquires Instacart. To complete Instacart, I recommend Google to explore acquiring Boxed Wholesale.
Option 3. Acquire Costco
Like Target, the acquisition of Costco would give Google ownership of one of the best and most popular retailers today. Although currently focused on bulk sales, Google could expand Costco's reach to include grocery shopping on a much larger scale. One option to explore would be that Google also acquires Instacart.
As I said earlier in the article, Google must take a big step forward. The joint acquisition of Costco or Costco and Instacart would be considered the most disruptive acquisition ever made in retail.
This is the second option I prefer to Google, especially if Instacart is also acquired. Google could acquire Peapod instead of Instacart, but Instacart is the recommended choice.
Option 4. Acquire eBay
Originally, I had recommended Facebook to buy eBay and embed the platform in the Facebook user page of every Facebook member in order to turn Facebook into a platform for Facebook. e-commerce linking social media and commerce. Another Forbes contributor wrote about my opinion on the subject of eBay's Facebook acquisition in this article.
(I think Google needs to seriously consider the possibility of Microsoft expanding LinkedIn to become an e-commerce platform.) I've mentioned this possibility in this article, and Google should also consider that Microsoft may decide to make a major acquisition. from a retailer.)
I have spoken at conferences and written many articles for which I have recommended Google to acquire eBay. I clearly understand the value of the eBay market for Google. I estimate that the acquisition of the eBay market could cost Google as much as $ 12 billion or more.
One last comment: I do not recommend that Google copy Amazon. I recommend that Google improve its differentiation capabilities by making one or more strategic acquisitions that will significantly enhance its ability to become a retail leader.
Conclusion
The purpose of this article is to present options that will generate discussion within Google and the retail community. I've presented options but I do not claim that they are the best or only options that Google can consider.
I think it's imperative that Google have a physical retail presence. While I understand that Google's desire is to enable retailing, I think Google can design and implement a retail strategy and ecosystem that can compete with Amazon, that retailers using Google Express and Shopping Actions. Regardless of the size and current market capitalization of Google, Google should aim to generate the greatest growth for the company at any time.
Will some retailers end their relationship with Google if Google acquires Target, Costco, Kohl's or any number of retailers? Probably. However, other retailers, and in particular sellers, will be happy to take advantage of Google's platform to enable transactions and chat with Google in its own stores.
The stores will allow Google to open brand-specific stores offering customers an increased immersive experience as well as increased content, two very important items for customers. Stores are also essential for grocery sales. Il est courant dans le commerce de détail que les clients veulent cueillir leurs propres fruits, légumes, viande, lait, œufs, produits laitiers et produits de boulangerie. Les magasins physiques permettront aux clients d'inspecter et de sélectionner les produits qu'ils souhaitent acheter.
Je ne peux qu'imaginer ce que Google pourrait faire s'il avait acquis Target et Sprouts. Ce qui est certain, c’est que Google, et non Amazon, aurait l’avantage, car Google surpbaderait Amazon en termes de nombre total d’épiceries et offrirait à ses clients une expérience dans les grands magasins dans 1 850 emplacements. Shipt devrait permettre à Google de répondre aux attentes des clients en matière de livraison, y compris le jour même.
Pour l'équipe de Google, je souhaite que l'entreprise atteigne son plein potentiel dans le commerce de détail. Activer le commerce de détail, c'est penser petit. Devenir un détaillant et tirer parti de tout son écosystème de produits pour réinventer le commerce de détail, c'est voir grand. Vous avez plus qu'badez de talent chez Google pour y arriver.
