Google Works On Launching Retail Stores

Submitted By pinky0708
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According to the article “Google Works on Launching Retail Stores,” the author talked about the possibility that Google would have its own retail stores in the USA like Apple. The stores would likely sell Google-branded hardware. Inside Google, the idea of opening retail stores has long been debated, as the company has become a major player in mobile devices. There would be a lot for Google to display in its own retail stores. For example, last year Google completed its acquisition of Motorola Mobility, which builds smartphones and tablets. Google's Android division has also been developing home-entertainment devices, and in recent years it has worked closely with hardware manufacturers to build Android-powered smartphones and tablets under the Nexus brand that Google has sold through its website. Google has also developed low-priced Chromebook laptops, powered by its Chrome operating system and built by hardware makers such as Samsung. Moreover, the Google X division is building Google Glass, a computing device worn on a person's face that could go on sale to the public sometime next year. Google could also use retail stores to show off Google TV software that is embedded in some TV sets and set-top boxes, allowing people to browse Web video content from their televisions. Google's expansion beyond web services and software into mobile hardware makes a move into retail seem logical to marketing management. For example, Microsoft, which historically focused on software but now makes its own devices such as the Xbox gaming console and the Surface tablet, has opened about 30 full-fledged stores in the U.S. and Canada and is developing another 11 stores (Microsoft, 2012). On the other hand, Apple now has 363 stores worldwide. Collectively, these stores generate a staggering $18 billion of revenue per year (Blodget, 2012).

The author’s voice is neutral. He gave some examples to support his statement – there is a high chance that Google will open its brick-and-mortar retail stores to compete with Apple and Microsoft. This topic is relevant to marketing because it allows Google brand to interact with customers actively, not depend on other retailers (e.g. BestBuy), and improve its market shares. For example, Google’s competitor, Apple is considered a pioneer in many aspects of customer service and store design. Its philosophy is not to sell, but rather to help customers solve problems. As a result, Apple's annual retail sales per square foot have soared to $4,406- excluding online sales, according to investment bank Needham & Co. Add in online sales, which include iTunes, and the number jumps to $5,914. That is far higher than the sales per square foot and online sales of jeweler Tiffany & Co. ($3,070), luxury retailer Coach Inc. ($1,776), and electronics retailer Best Buy Co. ($880) (Sherr, 2011).

Furthermore, Apple can take a lot more risks than other manufacturers because it has the stores. For example, if a customer has an iPhone’s battery problems, he/she feels confident to pop over to an Apple Store and get it replaced. In contrast, what would the customer do if his or her Nexus phone has the same problem? Mail it to Google? Google doesn't have the same retail infrastructure, so it can't take the same kind of product risks that Apple does.

In short, I do believe that Google should build its own retail stores. Today Google has tried to work on multiple fields, such as: service (e.g. social network), software (e.g. Android), and hardware (e.g. Nexus), so having the retail stores will increase its competitive edges in the IT market. Retail stores will create the interactive environment between Google’s brands and
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