Google has been slowly expanding its Shopping Express service over the past year in a bid to compete with Amazon on same-day deliveries. For now it’s still only available in and around San Francisco, Los Angeles and New York, but according to a new report from Re/code the service is about to expand nationwide as Google fights to control the future of product search.
One anonymous source with knowledge of the company’s plans claims the search giant has already earmarked as much as $500 million to bring Google Shopping Express from a few cities to the entire country. In a statement to Re/code, Google essentially confirmed the news without revealing how much it plans to spend on the service.
Google could potentially earn back that $500 million pretty quickly, especially with the grocery business currently valued at $600 billion. Convincing people to search for groceries and other products through Google instead of Amazon also means more page views, more clicks and more advertising dollars for the company.
Google’s strategy for same-day deliveries is a bit like its strategy with mobile. The company partners with different retailers and then sends employees to pick up items as they’re ordered and deliver them by hand—though we could see Google’s self-driving cars taking over this task in the future. By comparison, Amazon Fresh stocks its own warehouses to compete directly with traditional retailers.
The allure of same-day delivery you can manage from your smartphone is tempting, but it’s unclear if this kind of business model can work outside of a few high-density cities. Amazon’s already doing a great job offering two-day delivery pretty much anywhere in the country, but Google seems committed to giving Shopping Express the time it needs to catch on.