A recent article in RE/CODE got me thinking about the caution retailers must take when signing up with online partners.
Apparently Google has launched an all-out effort to combat Amazon in product search. As Amazon has added more information, product reviews and independent sellers to its website, it has become not only the place to buy products but the choice place to research them. Capping all this is the famous (and patented) One-Click feature for fulfillment.
In response, Google has created a localized online marketplace, Google Shopping Express, which delivers products to consumers from local retail locations. Google promises to deliver products picked up at retail locations to the consumer within specified time windows. In Manhattan, Google's new service still seems to be dominated by national chains — Target, Costco, Walgreens, Staples, etc. — but they are asking consumers to let them know about local retailers. Google allows consumers to shop by store and category, but also warns that all items might not be available at a particular outlet. All in all, it seems a little cumbersome to me and it is only available in a few locations. Then again, Google is just getting started.
Whether it is Amazon or Google, the retailer who decides to partner with one of these services has to think long and hard about the impact on their relationship with the consumer. During its "Amazon Rising" documentary, CNBC interviewed suppliers who used Amazon fulfillment services and complained Amazon cherry picked their best sellers to carry themselves. In the case of Google, without any store visit, does the consumer really think they are dealing with the retailer or buying from Google? Does the retailer risk losing the customer's loyalty?
Do you see more benefits or drawbacks for retailers working with online marketplaces such as those run by Amazon and Google?