As Google Express Expands Same-Day Delivery, Several Retailers Jump Ship
By Christine Kern, contributing writer
American Eagle Outfitters, Office Depot, and grocery store chain Lucky opt out as Google Express Expands.
A recent Google Blog discussed the new expansion of Google Express delivery, stating that the service will soon be rolled out in Chicago, Boston, and Washington, D.C. “Across all our cities, more than 7 million people can now access our same-day delivery service, and in Northern California almost 12 million can use our next-day service,” the blog states.
The blog also touted the addition of 16 new merchants to the service, including 1-800-Flowers, Barnes & Noble, Nine West, PetSmart, Vitamin Shoppe and Sports Authority, and regional merchants such as Paragon Sports in New York and Vicente Foods in Los Angeles, Stop & Shop in Boston; Giant Food in D.C.; and Lux Roses, TigerDirect, Treasure Island Foods and Wrigleyville Sports in Chicago.
While the recent expansion demonstrates Google’s growing commitment to the new service as it hopes to challenge Amazon in the online retail marketplace, several retailers have decided to “opt out” of the service instead. Their defection demonstrates that Google still has a number of potential obstacles to success in their new same-day delivery game.
The defectors included American Eagle Outfitters, Office Depot and grocery store chain Lucky.
While the reasons for their defection remain unclear, some speculate that it might be because they either have access to their own delivery service or have no need for such immediate access to products.
Fortune Magazine reported that, according to Greg Buzek, President of IHL , Office Depot could be opting out because it already has its own delivery service, making Google’s unnecessary. And same-day delivery makes little sense for a clothing retailers like American Eagle, Buzek explained.
Another possible reason for the defection could be that while Google offered the first year of service for free, it has recently announced that one-year memberships will costs users $95, or a pay-as-you-go fee of $5 per order.
Interestingly, while Target has signed on for Google Express, it is not expanding its services into the three new markets, and is also testing out its own same day delivery service.
In an email to Fortune, Eddie Baeb, a Target spokesperson, explained “Target has taken a test-and-learn approach with Google Express. We’ll continue to gauge results and guest feedback as we consider additional expansion opportunities in the future.”
Meanwhile, the future viability of Google Express will ultimately be dependent upon retaining enough retailers in their platform. Without sufficient partners, consumers will have no reason to use the service.