Google And Amazon Will Have A War In The Retail Field.

To put it simply, Google mainly relies on advertising revenue, and a large part of its lucrative advertising business is to facilitate people to buy goods and services.

That's what Amazon is good at.

As shopping related search requests begin to move from Google search to other places, Google's profitability is facing a direct threat.

Analysis and software company SDL recently conducted a survey to find out which three of their preferred gift buying platforms are in holiday shopping season this year.

The survey showed that "online search" accounted for 45%, down from 49% a year ago, and the largest increase in popularity was Amazon, which rose from 31% to 37%.

The click through rate of product advertising is also 21% higher than that of Google keyword advertisement.

Google's profit margins are facing downside risks. Amazon's involvement in product search is clearly a threat to it.

Amazon launched its seller service 15 years ago, and then began to evolve from online retailer to e-commerce platform.

In the process, it has opened its huge logistics infrastructure to third party sellers.

By the end of 2013, Amazon's platform had some 2 million sellers using Amazon Services and appeared on the website's product search results.

Today, 40% of Amazon's sales come from third party sellers, accounting for 20% of the company's revenue.

There is no doubt that a large number of third party sellers have made the choice of goods on the Amazon platform richer. This is one of the reasons why people tend to search for product services on Amazon instead of Google.

Amazon has a public relations problem: people like the convenience it brings, but many people worry that its mode may lead to the decline of local retailers.

And Google has the ability to make full use of Amazon's potential weakness.

Unlike Amazon, Google is not a retailer but a source of customers for retailers.

It makes money through advertising rather than the paction itself, which is the essential difference between Amazon and Amazon.

(Note: in addition to digital media, Google Google Play stores sell goods directly to end-users and compete directly with Amazon and other companies.

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In the past few years, in response to the impact of Amazon, Google has changed the way it deals with shopping related searches.

To be honest, its early shopping function is puzzling. Search ads are adulterated with free display products on its shopping website, which is not connected with its main search results page.

Google has made major changes in recent years.

Nowadays, when searching for "microwave oven" (microwave oven), you will see the commodity grid on the right side of the search results.

From the grid click "Shop for microwave oven on Google" (buy microwave oven on Google), you can filter out the merchandise nearby.

Click on one of the links, you will see the introduction of the product, highlighting local retailers, pricing, links to other retailers and other information.

Google's moves in shopping are more than that.

Its Google Express aims to make Google's shopping experience even higher by providing convenient distribution options.

Google Express currently covers only a few areas, including Boston, Chicago, Manhattan, Washington DC, Western Losangeles and bay area (providing overnight services for the rest of northern California).

Although there are small businesses in the Bay Area participating in Google's project, the company obviously focuses on those larger retailers.

Because they have more product inventory, their IT systems can easily integrate their products and directories with Google's search results.

The expansion of the project to a more popular small retailer will cost a lot of effort and money.

Relying on third party sellers, though, does not require Google to invest huge amounts of money in building storage centers like Amazon, but this mode will bring many other problems.

After 20 years of online retailing, physical retailing and virtual retailing must now be better integrated than ever before.

That's because we no longer use our desktop only to use the Internet.

The explosive growth of smart phones has greatly boosted mobile search.

By 2015, mobile terminals should surpass the desktop in terms of search volume.

Google not only focuses on advancing at both ends.

In the US, its desktop end search share is 67%, and its mobile end share is 83%.

The company now wants to pform its mobile search advantage into a driving force for its shopping strategy by understanding how to bring business to local businesses.

In essence, Google's strategy is determined by its "organizing the world's information to make it useful, for the purpose of people's acquisition".

Therefore, it is not difficult to understand that Google's shopping bet is more about the information processing behind the product service, rather than the product service itself.

Therefore, even if you have completed the paction through Google, you can know which retailer behind it is offering you goods.

Let's compare Amazon with its.

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Its Fire mobile phone is widely regarded as a "merchandise display" tool designed to help customers find products from local stores and then buy them more easily on Amazon.

Its mobile scanner Amazon Dash is a more obvious example of this strategy.

Fire phones and Dash are just extensions of Amazon platform.

These tools are highlighted.

In essence, its strategy is determined by the advantages of its e-commerce platform.

Amazon seller service enables other retailers to rely on Amazon's huge deal to process infrastructure.

When you buy things from these third party sellers on Amazon, you rarely notice their brand names.

From the buyer's point of view, you seem to have bought it from Amazon.

We are about to witness a war between Amazon and Google, and Amazon's challenge to Google will obviously exceed that of apple, Facebook or Microsoft.

The two strategy will not win.

In fact, the scale of the market is large enough to allow the two strategies to coexist simultaneously.

This competition will only make people's shopping experience more convenient. I personally think there are both advantages and disadvantages.

I am glad to see that Google takes a strategy that depends on the survival of local retailers.

The good times that belong to the local shops have long ceased to exist.

Nowadays, to survive or even thrive in the high-tech retail environment, even small retail shops have to be armed with technology, which means that a considerable portion of their income will flow into the pockets of technology giants.

This is not an ideal situation, but it's better than selling everything through a large store.