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#GJNEWS: Google to delivergoods to onlineshoppers

SAN FRANCISCO (AP) — Internet search
leader Google is taking another step beyond
information retrieval into grocery delivery.
The new service, called Google Shopping
Express, will initially provide same-day
delivery of food and other products bought
online by a small group of consumers in San
Francisco and suburbs located south of the
city. The company, based in Mountain View,
Calif., didn't say how many people will be part
of the test.
If the pilot program goes well, Google plans to
expand delivery service to other markets.
"We hope this will help users explore the
benefits of a local, same-day delivery service,
and help us kick the tires on the new service,"
Google said in a Thursday statement.
The delivery service is part of Google's effort
to increase consumer reliance on the Internet,
so it will have more opportunities to show
online ads, which generate most of its
Google has learned that the more time people
spend online, the more likely they are to use
its dominant search engine or one of its other
popular services, like its YouTube video site or
Gmail, that include advertising.
The delivery service also could spur merchants
to buy more online ads if Google's same-day
delivery service encourages consumers to do
more of their shopping online. Having to wait
days or, in some cases, more than a week for
the delivery of online orders ranks among the
biggest drawbacks to Internet shopping.
It's a problem that Inc. and eBay
Inc., which operate the largest e-commerce
sites, already have been trying to solve by
offering same-day service in some U.S.
markets. Wal-Mart Stores Inc., the world's
largest retailer, also offers same-day delivery
in five markets.
A mix of national, regional and neighborhood
merchants are enlisting in Google Shopping
Express. The best-known names on the list
include Target and Walgreen. All the
merchants in the Google program will sell
certain items through a central website.
Google has hired courier services to pick up
the orders at the merchant stores and then
deliver them to the customer's home or office.
Although the couriers will be working on a
contract basis, they will be driving Google
trucks and wearing company-issued uniforms.
It remains unclear whether Internet shopping
and same-day delivery can be profitable.
Online grocer Webvan collapsed in 2001,
largely because it couldn't devise a pricing
plan that would pay for the costs of same-day
delivery without alienating shoppers unwilling
to pay too much extra for the added
Google is still trying to figure out how much to
charge for its same-day delivery service. For
the six-month test period in the San Francisco
area, consumers won't have to pay a
surcharge. Google instead will receive a
commission from participating merchants.
The expansion into same-day delivery comes
at the same time that Google is preparing to
close some of its older online services so it
can devote more attention and money to other
The realignment has irked some Google users.
The biggest complaints have centered on
Google Reader, which allows people to
automatically receive headlines and links from
their favorite sites, and iGoogle, which allows
Web surfers to design a page consisting of the
Google search engine surrounded set up other
online features, such as local weather reports
and stock market quotes.
Google Reader is scheduled to close in July and
iGoogle will shut down in November.
Google shares fell $8.47 to close at $794.19
on Thursday.

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