Shownotes
This Omni Talk Retail Fast Five segment explores Google’s largest search overhaul in 25 years and what it could mean for retailers, ecommerce, and consumer shopping behavior.
Chris Walton and Laura Kennedy discuss how AI-generated answers may fundamentally change product discovery online, why retailers could lose visibility inside traditional search funnels, and how consumer trust will shape the next era of digital commerce.
They also debate whether shoppers actually want fully AI-driven shopping experiences or if human browsing behavior still matters more than Silicon Valley expects.
⏩ Tune in for the full episode here.
#Google #AISearch #Ecommerce #RetailTechnology #ConsumerBehavior #DigitalCommerce #AIShopping #RetailStrategy #OmniTalk #FastFive
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Transcripts
Google Search is getting its biggest overhaul in over 25 years.
Speaker A:This announcement is quite big, with the company announcing at its IO Developer Conference last week that it's completely reimagining the search box with AI surpassing 1 billion monthly users for AI mode and launching always on background agents that monitor the web without any user prompt, according to the Verge, which once again, for all you loyal listeners out there should never be confer Confused Confused with the fabulous band the verve.
Speaker A:Google announced five major search changes at its May 19 keynote.
Speaker A:Number one, a completely rebuilt search box.
Speaker A:Number two, a new default AI model powering AI mode.
Speaker A:Number three, persistent background agents that work on a user's behalf without being asked.
Speaker A:Number four, expanded agentic booking for local services and number five and finally, a rollout of personal intelligence features to nearly 200 countries.
Speaker A:And most features require no subscription.
Speaker A:The new search box supports text, image files, videos and Chrome tabs simultaneously.
Speaker A:Background agents, a new category entirely, can monitor topics of interest and proactively Surface updates without the user ever even typing a query.
Speaker A:For retailers, the implications here are potentially significant.
Speaker A:AI generated shopping summaries now claim the majority of above the fold real estate in product searches and brands cited inside AI overviews are seeing meaningfully more organic clicks than non cited competitors, according to early data.
Speaker A:Laura this also happens to be the A and M put you on the spot question of the week the A and M consumer and retail groups put you on the spot question of the week.
Speaker A:And so here it is.
Speaker A:Often people are criticized for using AI like Google.
Speaker A:Are these changes enough to make people use Google search like AI?
Speaker B:I think the simple question is that people are probably already using Google or the simple answer to that is people are using Google like AI.
Speaker B:And I have always really my sort of black and white take is just that Google wins.
Speaker B:I mean Google is the best, is the best positioned here it has the volume.
Speaker B:Especially when it comes to AI and commerce you can't beat the volume that Google has right now.
Speaker B:You know there was a chart that went around a few months ago around you know, daily traffic for purchasable product and it showed this big huge bar for ChatGPT.
Speaker B:The math has people have debated the math online in the in the the retail substacks and so and kind of cleared some of it up.
Speaker B:But you know the short story is that actually Amazon traffic is way higher and then Google just blows them all out of the water now, you know, harder to figure out where whether all of that is around trying to buy stuff.
Speaker B:You know the flip side is you know Google has all these statistics about users and using AI mode.
Speaker B:I don't know if anyone's actually doing that by choice, you know, and if anybody who's ever gotten an AI overview, I think there's a real feeling that they're wrong a lot of the time.
Speaker B:Is it wrong more than ChatGPT or its brethren?
Speaker B:I don't know.
Speaker B:Are we just accustomed to Google being right a lot?
Speaker B:You know, but that all said, Google's position as the, the destination of choice in the past, you know, I still think sets it up really well to be, you know, the shopping destination.
Speaker B:And that's, that's the part that I'm actually most focused on in all of Google's announcements is not really AI mode broadly, but all of the AI enabled shopping features that are underneath it.
Speaker B:You know, Scott Wingo, who writes the retail Gentex substack, he talked, he called out, he called out specifically that they added conversational attributes to, you know, how you tag a product on Google.
Speaker B:And that's a move toward, you know, reading a product's information more like a ChatGPT or you know, an answer engine would instead of just a keyword.
Speaker B:And, and so, you know, the search bar is a place where consumers want, are going to use natural language.
Speaker B:I think we're just all getting used to doing that everywhere we search.
Speaker B:And so I think the short story is if you're a retailer brand, you just have to be ready for this reality.
Speaker B:I think Google is still really well positioned.
Speaker B:I think the reasons why will come up in a little bit.
Speaker B:And when we talk a little bit more about Klarna and what's going to happen on, on chatgpt, but the way your product information is structured, you know, the richness of your attributes, you know, based on what I've heard from brands I mentioned, I, you know, spoke with somebody from Steve Madden, they said it took a year to make sure their data was ready and they, they worked with Scott Wingo's company incidentally.
Speaker B:And so they, they had to get their data ready.
Speaker B:It took up to a year.
Speaker B:Obviously they're probably still iterating all the time because these engines can read all kinds of different stuff.
Speaker B:So if Google being active in this space is the impetus for that from the, from the retail perspective, you know, then I think it's a really, you know, worthwhile place for a retailer or brand to spend their time.
Speaker A:Nice.
Speaker A:Okay, so I've got, I've got an observation that I'm going to push you a little bit because I think it's important to push you.
Speaker A:I want to push you on this one.
Speaker A:So the first one is the observation that there are sub stacks and subreddits for all the things we geek out on.
Speaker A:That.
Speaker A:That is fantastic.
Speaker A:I love that you just came clean on that.
Speaker A:That's great.
Speaker A:And then second, I want to push you so you think, you think Google has a right to win and I want to be very specific in understanding what you think they have a right to win at.
Speaker A:So what do you think if you're specific?
Speaker B:I think they still have the right to win at shopping and how people gather information for their purchases.
Speaker B:Because we have seen if ChatGPT and it's a checkout in another world had instant checkout had caught on and people were out here trying to check out in chatbots and very comfortable with it, then we might be having a different conversation because that might be telling us that people have decamped from all of their previous shopping habits online and they're doing everything somewhere else.
Speaker B:They retired instant checkout because people still want to check out on the retailer websites.
Speaker B:And I feel like Google probably could have told them that based on, you know, what Google has seen over, you know, time with Google shopping where historically and consumers can change anytime.
Speaker B:But I, I think that it told us that peop that consumers are doing a lot of research on ChatGPT but it, it's not necessarily where they're putting all of their, their stock.
Speaker B:The, the place where I think Google has really has the right to win though is if this at any point goes agentic or aut because, and you know, I'm spoiling our discussion about Klarna a little bit.
Speaker A:That's okay.
Speaker B:The wallet and payment and the idea of your robot paying for you requires a lot of security, technically speaking, security.
Speaker B:And then, you know, qualitatively speaking, trust and where you're going to pay.
Speaker B:And Google already has that trust.
Speaker B:It has a wallet, it has, you know, some, some features that are already built in versus this idea that you're going to have to sort of build all this infrastructure in a chat GPT.
Speaker B:Now you know, I, I'm sure OpenAI we have these partnerships with Shopify and there's, there's, there's stuff coming up, you know, we could do as the subsex show, we could have a whole other podcast just about that.
Speaker B:But I still am curious about where Google will go to really kind of take control or be the winner here.
Speaker B:Because I just think that the big, the companies and the technology that consumers already trust are just positioned really well.
Speaker B:I think right.
Speaker B:To win is actually the right way to say it.
Speaker B:You know, I don't know for sure that they will win, but they definitely are in the catbird season.
Speaker A:They have a horse in a race.
Speaker B:Yeah, yeah, yeah, yeah.
Speaker A:Or a car in the Indy 500, since you're from Indianapolis.
Speaker A:Right?
Speaker A:Yeah.
Speaker B:Maybe they're not in the pole position.
Speaker B:They're in the first row.
Speaker A:Okay.
Speaker A:Okay.
Speaker A:All right.
Speaker A:That's good.
Speaker A:That's good.
Speaker A:I'm glad, I'm glad.
Speaker A:I'm glad I asked the clarification because, yeah, for me, I think, you know, I think I, I don't disagree with anything you said.
Speaker A:I think the one question I have is like, will they win?
Speaker A:When it comes to commerce, our traditional definitions of commerce, I think, you know, are they in position to keep their search traffic in their marketing revenue 100%?
Speaker A:They are.
Speaker A:You know, they're probably in the pole position for that, quite honestly.
Speaker A:But.
Speaker A:But becoming the owner of the shopping journey in a fully agentic world, I don't know.
Speaker A:Payment is one thing which we're going to talk about next, which I'm really glad we are because it's really interesting how the headlines line up this week.
Speaker A:But there are other, you know, the merchant in me, the retailer in me tells me there are other.
Speaker A:There are just so many other.
Speaker A:And I'm going to use Joey Tribbiani air quotes here, customer important factors that come into play like delivery confidence, customer service, return policies.
Speaker A:So if all that just starts happening in isolation via these platforms, how are we as consumers gonna feel about that?
Speaker A:And where do we go if we have problems?
Speaker A:Because, you know, Google doesn't have the infrastructure around customer service set up in the same way an Amazon or Walmart does.
Speaker A:And so I don't know where the retailer is going to begin and where the com.
Speaker A:Where the search engines are gonna end or begin or end, whatever.
Speaker A:I'm even getting confused as I'm talking about it, Laura.
Speaker A:But I think there's more to it here.
Speaker A:And I go back to historically, like, you know, if Google was positioned for this, why weren't we just checking out with Google pay in the marketplace to begin with?
Speaker B:Yeah.
Speaker A:You know, now they're doing a lot of cool things like universal cart that got announced yesterday and all that kind of stuff.
Speaker A:But.
Speaker A:But that's how I'm.
Speaker A:I think there's more factors at play here that we're actually talking about routinely as an industry, at least that I'm seeing get talked about routinely.
Speaker B:Well, and I think the, the, the factors that you're bringing up are not just Google issues.
Speaker B:They are issues with there being a platform where we do all of our shopping.
Speaker B:That's not a retailer 100%.
Speaker B:That's not just a Google issue.
Speaker B:That's just like overall almost philosophical, like, could this ever happen?
Speaker B:Because this is the way we shop.
Speaker B:And you know, we've seen many, many times in history and even in our relatively short careers that they change and they just do a new thing.
Speaker B:So I think the thing with Google, I mean, you mentioned about customer service and all that.
Speaker B:I think that's where, you know, the payment term for it is, you know, merchant of record and like, who owns the payment and all that kind of nitty gritty stuff.
Speaker B:But I think that customer service tells.
Speaker B:It is maybe subconsciously why people prefer not to do their checkout in ChatGPT.
Speaker B:That might be one reason they said, I don't really understand what's happening here.
Speaker B:Yeah.
Speaker B:The other thing Google sees, you know, I have a Gmail address.
Speaker B:It knows everywhere I already shop the things I have bought, you know, whether I like it or not.
Speaker B:So I mentioned the Wallet as this very technical piece.
Speaker B:But that ability to see across, I think matters a lot for Google and an age in a truly agentic world, which increasingly, I'm not positive we're going to go the way that we thought we were.
Speaker B:But that's, you know, that's another discussion too.
Speaker A:Yeah, yeah.
Speaker A:And it comes back to what we talked about last week with Amazon, you know, like, well, well, you know, Google gets a lot of search traffic, but Amazon gets product search traffic, you know, and will it keep its hold on that or will it grow that with its announcements that it made, you know, with Alexa and, you know, Rufus and everything else it's doing?
Speaker A:You know, time will tell.
Speaker A:And, you know, because it does have, it does bring those things to the table in a way that the LLMs just simply do not.
Speaker A:And Walmart potentially has that ability too, especially the size of their marketplaces.
Speaker A:So.