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Welcome to Near Future. In this weekly feature, The Current spotlights innovations powering the next wave of commerce.
Search was a key building block of the web, creating a way to not just catalog the vast amounts of information available, but also to give a user a tool to quickly find what they were looking for in that vast trove. Providing a curated set of results, it also enabled discovery, in turn powering a massive ad business in the process.
These capabilities have helped to power the growth of ecommerce. Not only was an assortment of goods on a marketplace browsable, but shoppers could also pinpoint the items they were seeking. It helped marry the two ecommerce advantages of voluminous choice and items-come-to-you convenience. To be sure, ecommerce search is still being improved. Retailers are constantly upgrading search capabilities on their websites, and leading search engine Google is offering a new cloud tool to embed its ability to use AI to understand user context and intent through a recenlty-launched capability called Retail Search.
As mobile technology transforms ecommerce, there is more interplay between in-person stores and online shopping. Shoppers are getting more comfortable with the tools of ecommerce. They are also using them to solve problems that carry over in the offline world.
Search is a prominent example where this is playing out. Google has talked about the rise of searches for items that are “in-stock near me.” With the rise of curbside pickup as people prioritized safety in the pandemic and supply chain challenges that made finding items more difficult, it added capabilities in 2020 to display those items more prominently. It added a “nearby” filter to search results, and more information about local stores that was discoverable online.
Improvements on this front are only continuing. A recent prominent example came in the rollout of 100 new product releases from Shopify. A new feature will automatically sync inventory available locally with Google, allowing merchants to be able to notify shoppers when a product is available at a store through search.
With one new capability, search will be embedded as part of the experience of going to the mall.
Simon, which is the parent group of the nation’s largest mall owner with more than 200 properties in its portfolio, said it is launching a new tool that allows shoppers to research in-stock products at mall vendors. The company said it is currently being tested at 29 facilities, with a broader rollout expected this year.
"Simon Search brings new search capabilities to our retail centers, offering shoppers multiple ways to search for specific in-store merchandise," said Mikael Thygesen, Simon’s chief marketing officer, in a statement. "Simon is committed to providing shoppers with the most enjoyable shopping experience possible. This game changing search tool raises the bar, delivering enhanced inventory visibility to our shoppers.”
Browsing has long been a pastime at the mall. Now shoppers can search the inventory at stores.
Simon cited a host of familiar mall retailers that are plugged into the service, including Aéropostale, Anthropologie, Athleta, Banana Republic, Gap, J.Crew, JCPenney and Old Navy.
Along with the benefit to shoppers, the idea is that it can help to increase foot traffic to retailers' stores, as well.
In that, it has echoes of Buy Online Pickup in Store (BOPIS). That approach rose as a popular tool in the pandemic, allowing shoppers to make a purchase online and limit their time in a store at a moment when public health measure recommended doing so. At the same time, retailers appreciated that it still required a trip into the store, presenting an opportunity for shoppers to have another item catch their eye and make another purchase.
That dynamic could play out with enhanced search. Idetifying an in-stock item provides a reason to head to the store, heightening the chance of a purchase. In turn, attracting them into the store gives the retailer opportunities to make sales beyond the item that was the initial subject of their search.
It’s just one of the ways that malls are learning lessons from ecommerce as they seek to address a decline in foot traffic overall for in-person retail, which was down 5% in 2021. This occurred even as net sales rose. Traffic is bouncing back with a return to in-person shopping with pandemic restrictions lifting, as data from Pacer.ai showed a 17.4% increase in visits to indoor malls month-over-month in April 2022. This offers an opportunity for retailers to introduce ways to create stickiness among those who may be coming back for the first time in a while.
In another move that had plenty of inspiration from one of ecommerce’s most recognizable events, Simon’s Simon Property Group launched a new holiday called National Outlet Shopping Day earlier in June. Timed right between Memorial Day and back-to-school just like Amazon Prime Day, the shopping holiday was designed to provide discounts, arriving at a time when prices were rising with inflation at 40-year-highs. Now, Simon plans to make it an annual event.
With shoppers increasingly toggling between ecommerce and in-person shopping, offline and online retail are blending. Expect more familiar features of online shopping to show up IRL.
Trending in Marketing
Shopping results may get a new look on Google.
Google will apply generative AI to shopping searches as part of a series of new capabilities that rolled out this week at Google I/O.
With new updates to search in general, Google is aiming to expand the number of questions to which its search engine can provide answers, as well as change how the information is organized.
One of those functions includes shopping. According to a blog post, Google is now testing a new form of shopping search where users who type in the kind of item they are seeking get a “snapshot of noteworthy products to consider and products that fit the bill."
It will also display product descriptions that include reviews, ratings, prices and product images.
"With generative AI in Search, we can help you understand the full picture when you’re shopping, making even the most considered and complex purchase decisions faster and much easier," Google wrote in the blog post.
Google said the generative AI experience is built on Google’s Shopping Graph. This contains more than 35 billion product listings, with more than 1.8 billion listings refreshed every hour.
While there will be a new look to the results, familiar elements will still be in place. Ads will continue to be displayed as part of search results, Google said, appearing in dedicated slots throughout a page.
The experiment starts at Search Labs with a new initiative called SGE (Search Generative Experience). It’s available on Chrome desktop and the Google App. Access will begin opening up in the coming weeks, Google said.
The move offers the latest signal that a rapid period of growth in generative AI will bring about new tools for ecommerce. In this case, one of the most powerful search engines is transforming how it displays products, and aiming to get even better at answering questions. While this is still an early experiment, it suggests that generative AI has the potential to bring change to the structure of commerce on the web as we know it. Brand leaders should pay attention.
What will Amazon do? It's a question that looms over any shopping search announcement from Google. Amazon overtook Google as the top destination for new product searches. But improved tools from Google stand to make the search engine more attractive. Will Amazon respond with new capabilities of its own? The question becomes increasingly complex at a time when advertising is increasingly important to Amazon's business. It will likely tread carefully in any effort to tweak search results page structures that have proven to be lucrative.