Google Goes Local
As if complete domination of the interwebs weren’t enough, Google’s latest few business moves have the company drilling down to the nitty gritty of the net to ensure that every advertising dollar, no matter how small, is within their reach.
Last week, Google made the announcement that they acquired Zagat, the 32-year-old restaurant rating system trusted by grandparents everywhere. Touting them as the original user-generated-content, Google’s team lavished praise on their new purchase: “Their iconic pocket-sized guides with paragraphs summarizing and ‘snippeting’ sentiment were ‘mobile’ before ‘mobile’ involved electronics.” Google says that the Zagat ratings will help bolster their integrated Google Places platform, which offers online reviews, maps, and contact information for businesses. Sound familiar? That’s probably because it’s a lot like Yelp, which Google made an attempt to purchase in 2009 to the tune of $500 million. Yelp didn’t bite, so Zagat was the next likely target, even though, as some point out, this means that for the first time Google will delve into both content creation and print publishing (all while fighting anti-trust allegations saying they now steer searches away from Yelp and toward Places).
Google also launched it’s Offers site in Boston last week, which they acknowledge is another attempt to secure local advertising dollars. But why now? Facebook and Yelp have both recently pulled the plug on their deals, and The Atlantic just noted that many daily deal sites saw a drop in viewers this summer, which they credit to consumer coupon fatigue. So what makes Google think that now is the time to enter the marketplace (particularly after Groupon, the company they tried to acquire for $6 billion last year, seems to be in some serious trouble)? It seems as if their argument largely comes down to: We’re Google, isn’t that enough?
A Google spokesperson points to the “wide variety and high quality” of their participating businesses, and says notes that unlike other deal sites, the revenue from the pre-paid Google Offers will be paid to the businesses within a week. “With costs on the rise for everything from gas to milk, getting paid up front means a lot to small businesses,” the spokesperson said. Or in other words, screw Groupon, we’re Google dammit. We practically print our own money, of course we’ll pay you faster.
Right now, there’s not a whole lot of novelty beyond other daily deal sites over at Offers, though it’s integration with the Google sign-in does make it simpler to get easy access to the deals. Google says their Offers are part of their plan to expand Google Wallet (which may foretell the complete obsolescence of the credit card), and they promise to “innovate in the space” to make offers more useful for consumers and efficient for businesses. So do they actually anticipate that they’ll make a profit? Or is this more of a move to shore up the online deal site space and give them access to local ads, all while getting the satisfaction of sending Groupon into its grave? At least on the profits end of it, the response from Google was: “No comment.”
Source URL: http://www.bostonmagazine.com/news/blog/2011/09/13/google-local/