POV: Google Launches Shopping Actions to Compete with Amazon
Mindshare Point of View
Google has launched ‘Shopping Actions’ as part of its growing battle with Amazon. It will feature Google Express, a universal cart that allows users to add and purchase products from a variety of retailers, with a single checkout. In addition, Shopping Actions will also allow for purchases via Google Assistant and Google search results.
Details and Implications:
Shopping Actions is designed to make it easier for consumers to buy what they are searching for by cutting down on the number of clicks to purchase. Mobile searches for ‘where to buy’ have increased by 85% from January – June 2015 vs. January – June 2017 according to Google. Though mobile search has been on the rise, shoppers are still being drawn to Amazon to purchase and Shopping Actions turns Google into another route for retailers.
How it works: When searching for items on Google, sponsored listed options will be curated to include the partners taking part in Shopping Actions, giving users the option to add to their Google Express cart - a ‘universal’ cart that allows products to be added from a variety of partnered retailers. The Google Express cart experience ends in a single checkout, creating a single ecosystem under the Google umbrella.
For example, a user will be able to add groceries from Walmart to their cart on mobile at lunchtime in the office and then continue to add their favourite beauty products from Ulta Beauty from their tablet at home and then be able to purchase everything at once - all whilst being able to collect and link their associated loyalty points.
What’s in it for Google? Revenue. The service will use a Pay-Per-Sale model, taking a cut from the revenue only once the shopper has purchased goods – in exchange for providing retailers with the Google Listing and the ability to be included into its shopping environment.
For retailers, Shopping Actions lets them:
- Surface products on platforms like Google Assistant and utilise Voice Shopping.
- Access a universal shopping cart, instant checkout and shoppable sponsored listings – giving consumer a new way to shop their products.
- Increase loyalty and engagement with high-valued customers with options like 1-click re-ordering, linked loyalty programs and basket-building algorithms to turn one-off shoppers into repeat customers.
In the trial of the service, retailers taking part saw the average size of a customer’s shopping basket increase by 30% after joining the program. Ulta Beauty saw average order values increase by 35%. Target saw its Google Express baskets increase by 20% after 6 months.
Shopping Actions is currently available in North America and open to any retailer.
This new feature represents a new front in Google’s battle with Amazon as well as a diversification of the shopping ecosystem for retailers, which of course competes with their own ecommerce operations, so it is a double-edged sword. Though some retailers are concerned over whether their own promotions can enter Google’s new shopping experience, the ones who are taking part in the program are already seeing increases in basket size and average order values. Time will only tell how it will impact Amazon and whether Shopping Actions will truly take purchases and market share away from them (or the retailers own operations).