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BizReport : Advertising archives : May 26, 2016

Expert: What Google, Amazon announcements mean for marketers

Both Amazon and Google have made announcements that have brands and marketers wondering what to do. One expert weighs in on what these announcements mean for marketers.

by Kristina Knight

Kristina: Let's talk about the Amazon announcement, first. What implications does this hold for merchants?

Kurt Heinemann, CMO, Reflektion: While retailers have traditionally been competing with each other, the truth is that they have been increasingly competing collectively with eCommerce giant Amazon. Amazon's step into private label apparel and packaged goods is the continuance of their domination of retail. It wasn't enough that they accounted for 60% of US online sales growth in 2015; now they want to essentially disintermediate apparel brands and eliminate one more element of the supply chain by leveraging their incredibly high traffic and Amazon Prime.

Kristina: And what about the Google announcement?

Kurt: For Google, their announcements around mobile, local and visual is more upstream for the consumer and provides an opportunity to expand on Google's deep understanding of shopper demand and intent. Not only does Google understand more of what people are looking for, they also can quickly develop a more thorough view of what results and value create the right conversions. In doing so, Google further solidifies their place as the market maker for shopper demand.

Kristina: You believe both of these announcements share a common denominator: data and it's use.

Kurt: Both [Amazon and Google] are gathering and leveraging data in a more powerful way with each step in their progress. Amazon's march to private label is fed by their already rich shopper database. They aren't selecting categories or products randomly. They already know what consumers are interested in based on their searches and purchases on their dominant digital retail site. Whereas Google's expansion with mobile, local and visual is their own land grab of more data for consumer interest at the search initiation level and the most relevant and successful search results. They are data rich when it comes to shopper intent and are further stuffing their coffers with even more shopper intelligence.

Kristina: What do these announcements mean for retailers, specifically?

Kurt: For retailers, there is a critical lesson to be learned from these moves. We are entering a shopper intelligence war and those brands that have the most intelligence about their shoppers have the opportunity to not only win their inter-retailer battles, but also establish a more intimate relationship with their shoppers that creates lock in. This insulates brands against the Amazon juggernaut and maximizes the conversion events from Google. It's done by leveraging the wealth of first party data that all retailers have access to by creating more intelligent and relevant experiences for their shoppers, speeding them to the items they are most interested in, and creating successful shopping discovery. This used to be called personalization, but this next level is more about individualization and meeting the expectations of the digital consumer.

Tags: advertising, Amazon, ecommerce, Google, online business, Reflektion

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