- The market research firm Canalys named Google Cloud the leading cloud in the retail industry.
- That’s notable, given that rivals Amazon Web Services and Microsoft Azure are seen to dominate the overall cloud computing industry.
- Under CEO Thomas Kurian, Google Cloud has placed its focus on appealing directly to six specific industries, including retail — a strategy that includes hiring sales and marketing staff dedicated to that purpose.
- Canalys says that in Google Cloud’s ability to offer advertising and search services to retailers alongside its core cloud offering makes it stand out from Microsoft, and those same customers like that it doesn’t compete in e-commerce the way that Amazon does.
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One of Google Cloud CEO Thomas Kurian’s key strategies to take on the dominant Amazon Web Services and Microsoft has been to focus on selling directly to certain, specific industries. Now, a new report from market research Canalys shows this initiative has borne fruit, as Google Cloud is named the leading cloud in the retail sector.
Analysts say that this is thanks to Google Cloud’s abilities to offer advertising and search services alongside its core cloud platform, its industry-specific focus, and that it’s not seen as a competitor in e-commerce, the way that leading cloud platform Amazon Web Services is.
Google Cloud already has some major retail customer wins under its belt. Earlier this month, Google Cloud announced an expanded multi-year partnership with Best Buy to provide infrastructure and analytics services to help with retail strategy and customize shopping experiences. Google Cloud also counts retailers Costco and Target as customers.
Still, Google Cloud is far behind AWS and Microsoft when it comes to cloud market share in the United States, with Alibaba also a strong contender on the global stage.
Retail is one of the six industries targeted by Kurian’s strategy, with the others being financial services, health care, manufacturing, media and entertainment, and the public sector. As part of this master plan, Google Cloud has hired salespeople aggressively, as well as forged partnerships to win over customers in each sector.
As part of the initiative, Google Cloud now has a sales team entirely focused on retail customers, while also building specific products like Google Cloud for Retail, designed to help retailers with hosting, inventory management, search, and product recommendation. It also offers AI-powered search engine optimization services, a boon to sellers.
The coronavirus pandemic has likely only accelerated Google’s appeal to retailers, many of whom were forced to double down on e-commerce as physical retail stores closed or reduced their capacity in the name of public health. That means using a platform like Google Cloud to modernize and go online.
“Especially during this pandemic, people need to move their online experience along,” Canalys research analyst Blake Murray told Business Insider. “Google is in a great place to do that, They are leaders using artificial intelligence and machine learning. I think it gives them an edge in that way.”
Competing against AWS, Microsoft, and Alibaba
Google Cloud isn’t the only cloud company going after the retail sector: Amazon Web Services has made its own play for the space.
AWS was originally designed for Amazon’s internal use, meaning it has a notable e-commerce pedigree, as well as a partner program focused on retail. Nike and Disney are both big AWS customers. However, on the other hand, many of the retailers that AWS is going after are also competitors on some level, which could turn them away.
“Due to this competitive aspect, many major retailers have opted to work with other cloud service providers,” Murray said.
Microsoft, meanwhile, has a huge, decades-old partner-network with over 2,000 retail-specific applications, Murray notes.
However, Murray says, Google’s strong position in search and advertising makes it appealing to retailers, as well as its charm offensive in the sector. Google Cloud gives customers more customizable contracts and service “in a way that’s arguably better off than Microsoft is,” Murray says.
Murray says that ultimately, Google Cloud’s momentum with retailers is a sign that the company has a real shot at catching up with its rivals, but that it’s far from a sure thing.
“They can work with huge retailers,” Murray said. “They have customized solutions and support teams ready to go. It’s a big question over time. Can Google catch up to Microsoft and AWS? I think the answer is ‘yes,’ but it really depends on how they utilize their strategy and how well it works out in the long term, not just in retail but all the other verticals.”
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