In A First, Google Does Real-time Joint Retail Trials

Written by Evan Schuman
March 18th, 2010

In the 15 or so years that we’ve had E-Commerce, the industry has seen quite a few improvements, but nothing that radically changed the way people shopped or retailers sold. Local inventory search, which today is not even in its infancy (not really even embryonic; it’s more like a zygote), is likely to be the first truly dramatic shift.

Consider a quest for a stuffed animal shaped like a buffalo or a very specific part for a long-discontinued product. Assume that the consumer needs it today, so overnight shipping isn’t an option, or perhaps the consumer needs to examine it prior to purchase. The capability for a search engine to have a current and comprehensive list of products (SKU and sub-SKU) for every retailer in a given geography has huge potential to reshape E-Commerce. If nothing else, it could be some very good news for the smallest of retailers today, which hardly ever see any search engine revenue.

Last Thursday (March 11), Google made a major—albeit extremely preliminary—move into local inventory search through a deal with a handful of major chains: Best Buy, Sears, Williams Sonoma, Pottery Barn and the Vitamin Shoppe. The beta test has its accuracy issues, missing many products that are definitely in stock at those chains.

It also gets too specific too quickly. For example, we ran a test seeking a good HDTV. It found quite a few specific models and configurations. But it forced us to select a specific model, brand and configuration rather than allowing us to say, in effect, “Find me the nearest store that has any.” The ones it found were all much farther away than the Best Buy around the corner (and, yes, we checked. That local Best Buy had several HDTVs in stock).

But those bugs will get worked out. Indeed, from Google’s perspective, that’s the whole point. Instead of working out this process internally and then bringing in retailers—or the reverse, with retailers figuring it out first—Google’s objective is to run the earliest stage tests with various chains “so we’re both learning how to do this in parallel,” said Paul Lee, Google Product Search’s business product manager.

“There is some conception, historically, that there is a linear model where the retailer has to get everything done right. Then, eventually, the search engines can piggyback,” Lee said, suggesting that the simultaneous approach should sharply accelerate learning. First, the sequential approach would theoretically take much longer, as the retailer would have to figure it out and then explain the discovered process to the search engine. But realistically, the retailer will likely not have considered some things the search engine lives and breathes, thereby forcing the process to be re-created. If the search engine went it alone, a similar lack of experience with retail logistics would cause the same problem. By doing it together, the learning curve should be much faster and the robustness of the final product stronger.

The Google test is being done solely in mobile, leaving the desktop for much later, if at all. It’s not even offered for all of Google’s mobile platforms: Only iPhone, Palm WebOS or any Android-powered device. Sorry Blackberry users!

But the challenge for the retailer to have a comprehensive and current list of every product down to the sub-SKU level—not merely that it has 52 stuffed animals in stock from the Acme Toy Company (if it’s good enough for Wile E. Coyote, it’s good enough for us), but that it has three shaped like buffalos—is huge. The potential rewards are equally big, though, with each and every product capable of acting as its own tiny little search engine ad for the store.


5 Comments | Read In A First, Google Does Real-time Joint Retail Trials

  1. Rob Rice Says:

    Interesting and natural move for Goggle given they already plot layers (e.g restaurants, gas stations) on top of maps on mobile devices. But Google is behind Shop Savvy in this product search effort. With the Shop Savvy mobile app, you use the phone camera to scan the product package barcode (UPC, etc.) and up pops a list of web and store competitors in the area also selling the same product, for how much, with customer reviews. Both solutions support consumer control over product information using mobile technology.

  2. Evan Schuman Says:

    Editor’s Note: Google also supports the barcode scan, as do many others.

  3. bill bittner Says:

    As mentioned, the key to satisfying consumer demand is “data normalization”. Normalization involves recognizing what are considered equivalent products. The challenge is that “equivalent” could mean something completely different to each consumer. You don’t need to know what the inventory is until you know what you want to buy. So before an inventory application is in place, a good product data base that allows consumers to search by product characteristics is necessary. Big retailers have already done this by allowing consumers to search by brand and major features such as LCD vs Plasma, screen size, etc. If the consumers are going to a retailer’s site to determine what they want, I am not sure how likely they are going to be to go somewhere else to screen inventory.

    Amazon seems to have recognized this, combining a lot of the searching with links to various online retailers besides themselves. To that point, Amazon seems a better place to meet consumer demand for this type of service. Small brick and mortar retailers can load their inventory onto Amazon.

    But in any case, the challenge is to avoid disappointing a consumer who jumps in their car and arrives at the store only to find the inventory is wrong or has been depleted.

  4. Evan Schuman Says:

    Goog point, Bill. All such displays should have a default note in prominent type: “Please call first.” On a mobile app–or just a site accessed via a mobile device–that can even be a link to the store’s listed phone number.

  5. Tom Stegmann Says:

    This may be more of a question… Recently launched POS SaaS offerings for small and mid-sized retailers (brick&mortar and webfront) are being reasonably quickly adopted. The retailer’s inventory is stored in the POS system on a “cloud server”, usually identified by the manufacturer’s SKU/barcode.

    SMB inventory aggregating sites (e-stores)over the years have often required their own inventory recording in addition to the retailer’s own POS system. This never works.

    However, if it was relatively simple to integrate an SMB SaaS POS system with a major search site like what Google is doing–wouldn’t that solve the problem of hyper local inventory discovery and management?


StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 60,000 retail IT leaders who subscribe to our free weekly email. Sign up today!

Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.