Shopping Spree Google PK Amazon

[Abstract] Google learning a good example of Amazon, the introduction of courier membership service Google Express.

Tencent Francisco October 16th, Google executive chairman Eric · Schmidt (Eric Schmidt) recently claimed that Google in the Internet search area is the biggest rival amazon. In any case, it may be half true. In the field of global search, Google, in addition to Microsoft, there is no opponent, and the search for a variety of goods directly to the Amazon shopping. Therefore, if the search is equivalent to shopping, Amazon can rival Google.

in the face of competitors, Google is not used to choose to escape. Google has launched its own shopping and courier services Google Express, only need to pay $95 per year membership fee, you can enjoy free home delivery services in the top 7 cities in the United states. Previously, Google launched Google Express only in 4 cities, and members enjoy free offers. For consumers, this service feels like Amazon’s Amazon Prime. But as a business, it’s more like Uber or Alibaba.


business has its own market, consumers and merchants gathered in the same information platform, the platform for shopping, inventory, delivery and payment outsourcing functions, of course, consumers must use Google wallet. But Google does not have its own courier service. On the contrary, it must pay to the logistics company, and the organization will be purchased by consumers from Target or Whole Foods and other stores to the customer’s doorstep. These stores every time to pay commissions to Google, AT Kearney, a management consultancy, estimates that each commission may be only a few dollars.

outsourcing express means that Google can not control costs and accurate implementation, like Amazon, and the relationship with the business may be very complex. For example, one of Google’s most early partner Target, did not participate in the service of Google Google Express latest 3 cities. But this is a "light asset" model, which is about outsourcing of product manufacturing and retail distribution business. If the scale has been expanded, Google will benefit from this.

so why Google to enter the courier service business, Google’s core advertising business growth faster than the global business sales, the former was 20%, the latter was $15%. However, the advertising business is only related to the sale of products, and to provide express service means that Google can profit from each transaction more. Like Amason, Google wants to sell the process to the end. (SAIL)

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