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Google prepares to provide local shopping information

Google executives said on Monday night that the company planned to move quickly to capitalize on its new Google Base database service, adding a feature that lets merchants provide local shopping information.

Many publishers had become concerned about the potential of Google Base, which could allow the company to dominate the classified advertising business. Now, publishers of services like the Yellow Pages are facing a competitive threat from Google.

Google, based in Mountain View, California, said that yesterday morning it would make available a feature that provides a local version of its Froogle shopping service. The service uses a third-party database of national product inventory organized by locality.

Additionally, local merchants will be able to send Google product information that will be searchable from Froogle. For example, if users type "iPod Nano New York," they will see map information with all the locations of stores in that region that have the iPod Nano in stock.

Marshal Cohen, chief retail analyst at NPD Group, a market research firm, said that if Froogle delivered up-to the-minute inventory updates from retailers, "consumers will finally know whether a trip to a store is worthwhile."

"The only thing missing from the online retailing equation is `Do they have what I want,'" Cohen said. "But putting inventory on the Web, by store location, means now all of a sudden I have that final piece of the puzzle."

Google executives said the Froogle local service would be particularly useful in cases where consumers are considering buying products that are bulky or heavy and that they do not wish to purchase online.

"There are items that you don't want to buy far away and have shipped to you," said Marissa Mayer, Google's vice president for search products.

Google declined to identify the third-party information service that would provide the initial product inventory information for local stores, but it said there would be data from "several hundred" chains, like Best Buy, Circuit City, OSH, Home Depot, Bombay and CompUSA.

The limitation of the service, Google acknowledged, is that the inventory information might not be precise or necessarily up to date. The service will be freely available to merchants in the US, Mayer said. Google, as it frequently notes, plans to gain revenue from the new Froogle service by placing relevant text ads on the same page as the local results.

The company also believes that it gains revenue when users employ Google more frequently as its services become more useful.

Cohen said that traditional telephone directories like the Yellow Pages were a "one-dimensional advertising method" that would eventually become obsolete in the face of new online directories that combine searches with product information.

Google declined to name the provider of inventory data, but companies like Axciom, Channel Intelligence and Shop Local are already providing that information.
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