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Amazon is eating away at Google's core business (AMZN, GOOG)
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For more and more people, Amazon is the first port of call when it comes to researching potential purchases — and that's bad news for Google.
Over half of Americans now go to Amazon to carry out their first search for products, turning away from search engines and other online retailers, according to a new study from the marketing company BloomReach. (The research was previously reported on by Bloomberg.)
Fifty-five percent of those surveyed made their first search on Amazon, up from 44% a year ago. At the same time, just 27% of people began at search engines, down from 34%. Retailers also saw a decline, dropping to 16% from 21%.
(The study took place on Labor Day, May 1, and surveyed 2,000 US consumers. There's no word on data from other countries, but it seems reasonable to assume that the data might be similar in Western markets where Amazon has a similar presence as in the US.)
It's a yet another sign of how fully Amazon is dominating online shopping — but it's also particularly bad news for Google.
Google's original, core business is a search engine. But more and more consumers are now opting to bypass it in favor of heading straight to the ultimate destination.
Alex Wong/Getty ImagesThe ads Google can serve next to product or shopping searches are especially lucrative (as they can be highly targeted at users clearly intending to spend money), making this trend more damaging than if Google's search market were eroding in a different sector (educational searches, for example).
A Google representative declined to comment.
There's still no guarantee, however, that people who visit Amazon first will definitely buy from there — something BloomReach acknowledges. "Just because consumers start on Amazon, that doesn't mean they ultimately buy from Amazon," marketing head Jason Seeba said in a statement. "Instead, they're often comparing and researching products on search engines and other retailers."
Plus, it's not as if Google is dependent solely on search: Its revenue now comes from everything from its DoubleClick ad network to its Google Play purchases.
But even so, Amazon has become the unrivalled go-to destination to start Americans' search for products — and that has to worry the world's largest search engine.
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