As reported on TechCrunch.
by DARRELL ETHERINGTON
Rumors from an “extremely reliable source” speaking to 9t05Google have suggested Google will start to operate its own physical retail stores starting as soon as the 2013 holiday season in the U.S. Brick-and-mortar shops from an Internet search company? Sounds like a stretch, but the Goog is breaking out of its search box big time, and recent additions to the Nexus line are proving it has a real chance at establishing a direct relationship with customers.
Google has had a difficult time keeping its Nexus 4 smartphone, manufactured by partner LG, in stock, with the device being mostly unavailable through Google’s Play store until just recently. But the company’s efforts to sell direct weren’t an overnight success; it attempted to sell hardware direct with the Nexus One back in 2010, but stopped selling after a few months, since very few customers opted to buy the device at its full, unsubsidized price online.
But if Google does one thing well, it’s iterating on less-than-stellar product launches and building on a firm foundation of failure. And that’s exactly what it has done with Nexus; the tablets it starting selling the via its online hardware store did major one thing better than the Nexus One, by offering no-strings-attached hardware at a bargain basement price. Hardware sales, Google seems to have learned, won’t work if customers are asked to eat a cost hit in exchange for freedom. They needed both, and weren’t willing to trade economy for freedom.
Now Google has the recipe right for online sales, and it appears to have worked very well for the Nexus 4, and at least moderately well for Nexus tablets. But Google is still missing a key ingredient that has helped the iPad gain enormous consumer traction, and this latest rumor indicates it’s listening to the words of its biggest rival about how to possibly finally come up with a significant breakthrough for Android tablet market share.
Apple CEO Tim Cook has made no secret about Apple retail’s impact on iPad sales. Most recently, he essentially attributed the iPad’s worldwide success to Apple’s physical stores, and the opportunity they provided to make believers out of customers who might otherwise not necessarily have understood Apple’s tablet as a product category. As Ingrid noted in her recent piece covering Cook’s comments on retail at a Goldman Sachs investor conference last week:
“One of the things that’s not understood that well about the stores is that I don’t think we would have been nearly as successful in the iPad as an example if it weren’t for our stores,” said Cook. He noted that people’s view of the tablet, prior to the iPad, “ingrained in their minds [was] a heavy thing that no one wanted.”
Google needs a tablet to achieve the same kind of thing with an Android tablet, or at least to come close. Making an “experience”-baed retail store akin to what Apple’s offering doesn’t guarantee consumers warm up to Android tablets, but it’s a risk that’s likely worth taking, given that Google has had positive indicators for its online retail efforts of late, and that Apple seems to place a lot of the credit for the iPad’s success squarely on the Apple Store’s shoulders.
Nexus tablets need a home run, and that hasn’t come in the form of hardware so far, despite modest gains by gadgets like the Nexus series and the Kindle Fire. But maybe that’s because a device isn’t the answer they’re looking for: customer outreach is.