Amazon Decides to Become a Bricks-and-Mortar Booster
Amazon.com Inc. built its business luring shoppers out of stores. Now the Internet’s biggest retailer wants to point them back to Main Street -- with detailed maps and photos.
The company plans to introduce a feature on its search engine today that taps into more than 14 million businesses around the country and lets users post reviews and read recommendations, just as they can for books, movies and other products at Amazon’s online superstore.
Amazon already displays targeted ads on its website and lets other merchants sell their wares on its site in exchange for a cut. By adding search to its offerings, Amazon is trying to build customer loyalty and aiming to become shoppers’ home page.
“We want to be the site of first resort for spending decisions,” said Barnaby Dorfman, director of product development for Amazon’s search engine division, A9.com, which is based here. “This is about breaking down the barriers between online and offline.”
It’s also about boosting profit margins. Like search-engine leaders Google Inc. and Yahoo Inc., Amazon plans to sell targeted ads and perhaps, analysts said, one day take commission fees for referrals to bricks-and-mortar stores.
The move into location-specific search puts Amazon more squarely into competition not only with Google and Yahoo but also with yellow pages providers. To get the attention of Web surfers, Seattle-based Amazon built several gee-whiz features into its search engine, which is dubbed A9.com Yellow Pages and accessed at www.a9.com.
One is Block View. Amazon dispatched a fleet of trucks equipped with cameras and global positioning devices to drive tens of thousands of miles and snap 20 million street-level photographs of businesses around the country, including hair salons, restaurants and antique stores.
Users can scroll their way up and down a block to see nearby shops and even parking signs.
So far, businesses in about 10 cities, including Los Angeles and San Francisco, have been photographed.
“I think it’s both very clever and potentially very important,” said John Battelle, a former tech magazine publisher who’s writing a book on search engines. “There’s something about seeing a picture of a business you’re considering doing business with that really brings the whole search experience into another realm.”
Another special feature is called Click-to-Call. A user can click a button on a listings page and, if he has given his phone number to A9.com, the phone will ring seconds later with the local business on the line.
A9.com Yellow Pages will be available only through A9.com at first but is expected to eventually appear as a “Yellow Pages” tab on Amazon’s home page.
Amazon faces tough competition from Google, Yahoo and Microsoft Corp., which offer their own location-specific search engines. But if Amazon can succeed in directing its loyal shoppers to the new product, online advertising could help increase the razor-thin margins of the retail business.
Search “is a very high margin business,” said Justin Post, an analyst with Merrill Lynch. “It could really help Amazon’s long-term margin outlook, and that is something investors have really been monitoring.”
Analysts raised the possibility that Amazon could parlay the local-search service into a business handling e-commerce sales for small shops. “It’s a natural move for Amazon to make if they decide to go that route,” said Chris Sherman, an editor of SearchEngineWatch.com, an online newsletter.
