Googazon Could Take Over Web 2.0

By Stan Gibson  |  Posted 2006-10-16 Print this article Print
Consumerization of IT could completely reshape the online retail industry, risking the creation of a dominant retail intermediary—call it "Googazon"—said Gartner analyst Hung LeHong Oct. 10 in a presentation at the companys annual Symposium/ITxpo here.

As the Web evolves into a collection of consumer--centric Web services, one or two huge players could come to dominate retail search, said LeHong.

"Its a scary scenario. A few major players could take over Web 2.0," said LeHong, suggesting that a merged entity such as a combined Google and could dominate as a "pretailer," a product search and price comparison portal.

"Googazon will sit between your customers and your company. It will be able to provide access to all retailers," LeHong said. "It will close 30 percent of transactions and guide 50 percent of purchases in any channel. It will force full retail transparency and will dictate how we compete. [By 2016,] you will need to work with Googazon."

The danger, however, is that Googazon could become a dominant market force, not unlike Wal-Mart Stores in conventional retailing today. The marketing muscle that such a company could exert on buyers and sellers could limit consumer and vendor choices, LeHong suggested.

This retail transparency follows the same pattern of Internet users trusting strangers on eBay, thanks to the transparency of the user experience and recommendations of fellow customers believed to be genuine, said Gartner analyst Tom Austin. In contrast, Austin said, "Customers dont believe big corporations anymore. People gather their own information and make up their own minds."

Googazon could help consumers by finding deals and matching them to a buyers financial profile, Austin said. To counteract the retail transparency that Googazon might bring about, Austin said retailers might try to change prices frequently, create complex packages that resist comparison or create customer loyalty programs.

Stan Gibson is Executive Editor of eWEEK. In addition to taking part in Ziff Davis eSeminars and taking charge of special editorial projects, his columns and editorials appear regularly in both the print and online editions of eWEEK. He is chairman of eWEEK's Editorial Board, which received the 1999 Jesse H. Neal Award of the American Business Press. In ten years at eWEEK, Gibson has served eWEEK (formerly PC Week) as Executive Editor/eBiz Strategies, Deputy News Editor, Networking Editor, Assignment Editor and Department Editor. His Webcast program, 'Take Down,' appeared on He has appeared on many radio and television programs including TechTV, CNBC, PBS, WBZ-Boston, WEVD New York and New England Cable News. Gibson has appeared as keynoter at many conferences, including CAMP Expo, Society for Information Management, and the Technology Managers Forum. A 19-year veteran covering information technology, he was previously News Editor at Communications Week and was Software Editor and Systems Editor at Computerworld.

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