Google Makes It Official With Same-Day Delivery Debut
The key element to a successful e-commerce platform is logistics, noted Coracent CEO Ron Rule. "Google certainly has the stamina and budget to give it a good run, but there are a lot of moving parts," Rule said. "Being a big data company doesn't automatically mean you'll be good at the logistics, so they're going to have a lot of challenges ahead."
09/26/13 12:24 PM PT
Google announced Wednesday that it is opening its Google Shopping Express service to shoppers in the entire San Francisco Bay Area, marking the official launch and first big expansion of the company's same-day delivery service.
Google began testing the retail delivery service earlier this year among a limited set of invited consumers in a few areas within the Bay Area, but the new announcement extends the service to anyone in an expanded region ranging from San Francisco to San Jose. With the service, online shoppers can place online orders from several chain stores, including Whole Foods, Target, Office Depot and Walgreens, and have those products delivered within the day.
Also on Wednesday Google released an app for iOS and Android that allows users to browse the shopping sites and order products directly from their smartphones.
New users who sign up before the end of the year can get six months of free, unlimited delivery service; otherwise, it costs US$4.99 per store order.
Google did not respond to our request for further details.
Race to Deliver
Google is not the only company to experiment with same-day delivery offerings. Walmart and eBay are both testing similar services -- eBay Now even offers the delivery within an hour, although consumers can only shop from a single store. Amazon is also following in the footsteps of companies like Fresh Direct and rolling out same-day deliveries on groceries to customers in Los Angeles and Seattle.
Google understands that it will have tough competition in the space and can afford to take a loss on the service at first, which is why it is offering the service for free for new users, said Rob Abdul, an e-commerce consultant.
"It is evident from the low price and free sign-up offer that Google is not interested in making money in the short term," Abdul told the E-Commerce Times. "That will come once there is a widespread adoption of their service -- that is their objective right now."
'A Lot of Challenges Ahead'
Although Google is not a retail hub at its core, the company has other strengths that could help it gain an advantage over its competitors, Abdul noted.
"Being a default search provider for many millions of users on all platforms, from desktops to tablets right thorough to mobile phones, can give Google an edge over Amazon and eBay," he pointed out.
Still, the key element to a successful e-commerce platform is logistics, noted Ron Rule, CEO of Coracent. Google might have deep pockets and effective algorithms, but it has a lot of catching up to do to make sure its delivery service could compete with those of companies like Amazon and eBay, which have years of experience delivering products to consumers worldwide.
"Google certainly has the stamina and budget to give it a good run, but there are a lot of moving parts," Rule told the E-Commerce Times. "Being a big data company doesn't automatically mean you'll be good at the logistics, so they're going to have a lot of challenges ahead."