Google Expands Express Delivery Service - Analyst Blog

Google Inc. (GOOGL), the world's most popular Internet search engine, is expanding its Google Shopping Express service into rural areas. Over the coming months, the company plans to stretch its service across northern California.

Google Shopping Express provides same-day delivery of food and other products bought online from participating retailers. The companies include retail giants such as Target, Staples, Office Depot Inc, Toys ‘R' Us, Whole Foods Market WFM, Walgreens and smaller outlets such as Blue Bottle Coffee and Palo Alto Toy & Sport.

Currently, the service is available only in the San Francisco Bay Area, including Berkeley, Concord, Danville, Dublin, Fremont, Oakland, Pleasanton, Richmond and Walnut Creek. The company stated that customers can enter their ZIP code to check if their area is covered under the overnight delivery service.

Online shopping has changed the shopping scenario. Customers visit retail shops to physically check the products but they finally purchase it online to get attractive discounts. Therefore, prompt and accurate delivery of products is essential for any company to succeed in the e-Commerce world.

Thus, it is important for Google to adopt innovative measures and offer the best to its online customers to compete with the likes of Amazon AMZN and eBay EBAY in the e-Commerce market. Last month, Amazon expanded its same-day delivery service to Dallas and San Francisco to gain a competitive advantage.

The Google Shopping Express service is indicative of the company's expansion into e-Commerce from online search. The diversification of its business into a fast-growing segment is a positive, especially since growth in the increasingly competitive search market is expected to slow down in the coming years.

In the first quarter of fiscal 2014, Google's earnings missed the Zacks Consensus Estimate by 5 cents. However, total revenue of $15.42 billion was up 21.0% year over year but down 1.0% sequentially.

Currently, Google has a Zacks Rank #3 (Hold).