Amazon Whole Foods effect on Google Shopping


Amazon’s Whole Foods deal had a ripple effect, according to Joe Rosenberg, a former strategic partnerships specialist for Google Shopping.

“It was a real wake-up call,” Rosenberg, who left Google in April to launch an e-commerce consulting firm, tells CNBC. “Deals we’d been discussing for years were suddenly fast-tracked to retailers’ C-suites.”

Guru Hariharan, CEO of ecommerce startup Boomerang, says that there’s been a kind of perfect storm where retailers are worried about losing sales to Amazon while Google’s worried about losing product advertising.

“The Whole Foods acquisition created a tremendous amount of urgency in the market,” Hariharan tells CNBC. “Both sides are feeling pain. If you’re fighting the same enemy, maybe you can figure something out.”

Whole Foods doesn’t operate in Europe, but Amazon recently partnered with French retailer Monoprix to launch grocery delivery in Paris, which also helped spur Google’s Carrefour deal, according to SunTrust analysts.

“We believe this is a continuation of a trend we’ve seen domestically where Google partners with offline retailers to bulk up their ecommerce offerings while giving retailers a stronger distribution channel online to better combat Amazon,” analysts wrote in a note to investors on Friday.

Amazon’s acquisition has also helped Google’s cloud business.

Carrefour’s agreement with Google includes the use of its Google Cloud tools, and several other major retailers including Kroger and have moved at least part of their business to Google Cloud since the Amazon-Whole Foods deal went down.

As Cloud chief Diane Greene told an audience at the Goldman Sachs Technology and Internet Conference in February, people used to be scared Google was going to compete with them, but that fear has diminished as Amazon’s ambitions have grown. “We’re really clear about what we’re doing and not doing. And now everybody is looking at Amazon and, like, that’s why we got so many retailers right away….”

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