Target and Google Partner on Conversational Commerce

by Raymond Pucci 0

Brick-and-mortar merchants are finding voice ordering to be another new buying channel to help sagging sales. As the following article reports, Target will be teaming with Google’s digital platform to enhance customer ordering and payment options.

Target announced today an expanded partnership with Google that, among other things, will now allow consumers to shop Target across the U.S. via Google Express, including by voice. The deal will also see the two companies working together more closely in the future in a number of areas, including the integration of Target’s own payment card, REDcard, into Google’s shopping platform, support for store pick-ups via voice, and more.

The news follows a similar announcement from Walmart in late August, which saw the retailer – Amazon’s biggest rival – partnering with Google on voice-based shopping. With the Google Home device, Google represents these retailers best shots’ at finding a way into consumers’ homes in a market where Amazon Alexa-powered smart speakers now dominate.

But Target believes that shopping by voice won’t necessarily be tied to an in-home device like the Echo or Google Home. “Who knows if these specialized devices will even exist in a few years time?,” says Target’s Chief Information and Digital Officer Mike McNamara, somewhat optimistically. “Or whether it’s a piece of software than runs on your TV or on your telephone.” He adds that most people will probably interact with the voice shopping feature by way of Google Assistant on their smartphone – a feature Google is also announcing today.

Target had previously been testing Google’s home delivery service, Google Express, only in select markets in California and NYC. Today, it’s making that service nationally available, across the continental U.S.

The expectation is that consumers will largely use Google Express today to pick up their everyday essentials – like more La Croix, which happens to be the most-ordered item in San Francisco, or Goody hair bands – the most-ordered item in L.A.

That means there will be some overlap between Google Express and Target’s own quick delivery service, Target Restock. But Target Restock on its own couldn’t leverage Google’s voice computing platform, so Target is essentially placing its bets on Google.

Merchants routinely offer online ordering to consumers who have gravitated to the e-commerce way of shopping. But a store’s omnichannel strategy has become more complex and competitive, so partnering with an enterprise-scale digital player becomes a necessity to provide more mobile-driven services such as on-demand merchandise delivery or mobile order and pay. Another channel—voice, or conversational commerce, is in its early stages, but expect it to take off as shoppers looking for convenience and immediacy make Alexa, Google, Siri, and Cortana part of their household family.

Overview by Raymond Pucci, Associate Director, Research Services at Mercator Advisory Group

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