Not too long ago, and eBay Inc (NASDAQ:EBAY)’s Paypal were making headlines. These leaders in the online shopping and payment industries moved rather successfully into the physical world, offering consumers the ability to buy goods in real stores and use their online billing accounts on site. On the other hand, Best Buy Co., Inc. (NYSE:BBY) and Wal-Mart Stores, Inc. (NYSE:WMT) have tried the alternate approach, moving from big-box retailers to an online presence.
Apple Inc. (NASDAQ:AAPL) has seen big success with the move to open stores across the country. Though a costly move, it seemed to be effective as consumers have appreciated the ability to try out new products, put hands on products before purchasing – a feature that companies like Amazon.com, Inc. (NASDAQ:AMZN) didn’t provide. By not relying on other retailers as its only method to sell iPods, iPhones, and iPads, Apple is able to capitalize on its record high sales for e-readers and tablets. In essence, it captures both on and off line markets.
Google Inc (NASDAQ:GOOG) is no doubt seeing the success and wants its own slice of the market. For this giant, I don’t see it as coming late to the party, but more of a strategic maneuver, timed perfectly with the roll out of some pretty hefty products such as the Chromebook and the upcoming ‘Google glass.’
The build up
Google Inc (NASDAQ:GOOG) has been prepping this move since last year. According to a report, it rolled out Google Inc (NASDAQ:GOOG) Shopping to several countries including the United Kingdom, Germany, France, Japan, Italy, Spain, and Switzerland. Google Shopping presents a “visually cleaner” result list for shopping queries, including new commercial formats.
Now, the company will take lessons learned to actual retail stores across the United States, providing, like Apple, a place to show off its growing number of products and allow consumers somewhere to go, ask, try, and buy. With the help of struggling Best Buy, which was over eager to team with a leader like Google Inc (NASDAQ:GOOG), it has set up Chrome mini-stores inside some Best Buy locations. Best Buy is still scrambling from a massive closing down of stores and laying off of employees over the past year. The loss of market share to Amazon and the migration to everything to a digital delivery system seem like an irreversible trend. The biggest hope for Google Inc (NASDAQ:GOOG) is that this move could help bolster the company's brand image, and win over Android skeptics – yet another play against Apple.
How Google should and should not do it
Amazon’s first official store offered its line of Kindle products, as well as other key brand merchandise. In their own store, Amazon has more control over the training, selling, and of course, more of the profits, as well as put them on the same level of Barnes & Noble, Inc. (NYSE:BKS), which offers the same for its Nook.
It is believed that Google will start by having its own shopping-mall retail presence. Unfortunately, according to an analyst from CNET.com, it seems to be trying too hard to be like Apple rather than differentiate itself. With “blue shirts, clichéd clean lines and permanent white shelves and fixtures”, it tries to ‘fit in’ with other tech-gone-retailer companies rather than stand out proudly.
A great analogy in the article follows:
"The Big Bang Theory" has proved to be one of the most popular TV shows, not because the nerds are hidden away, but because they are in full view, with a beautiful counterpoint in a real person called Penny. Imagine taking your kids, your lover, or your granny into a Google store and having them actually enjoy learning something…”
I agree with this assessment. Differentiation is most definitely the way to go to promote brand recognition, and carving out its own market share.