Thursday, May 13, 2004

Google vs. eBay?

What if Google decided to move into e-commerce? The business case is compelling. Not only would this be a major new market for Google (at the expense of eBay and, but also it would be an excellent strategic move against Yahoo (Yahoo! Shopping) and MSN (MSN Shopping).

What would it take? Google already has a shopping search engine, Froogle. Merchants even provide product catalogs directly to Google. To actually handle the entire transaction, they'd need a payment system. And they'd need reputation management system; using Orkut, they could build a powerful reputation management system that included having your network of friends vouch for your reliability.

How would a Google shopping site gain critical mass? One easy way would be to show Froogle results for any search. Initially, most searches would yield products selling on other merchants sites. Over time, as Google added more and more listings, Google would be managing more and more of the transaction. Combine this with an approach of trying to dominate specific categories of products first, and you have a viable and useful shopping site from day one.

So, what would it take? Google would extend its AdSense payment system to support shopping transactions, extend Orkut to help manage shopping reputations, and start handling the sale of some of products listed on Froogle directly. That's it. That's all it would take for Google to enter the e-commerce market. Think it will happen?

1 comment:

Anonymous said...

I agree. Ebay users are eager to jump ship the instant a viable competetor comes online. Google seems the only one to fit that mold. I can envision ebay falling like lightning within a month. They have become too nasty and greedy to endure any competition. They have provided this fuel for the competition themselves. We gave them enough rope.