Google Reportedly Closing Express Delivery Hubs in Bay Area

Google is apparently revamping the service using third-party start-ups to make the deliveries, streamline the operations and save money.

Google Express, online delivery, Amazon, delivery hubs, same-day delivery

When the Google Express same-day delivery service began as a pilot in the San Francisco Bay Area in March 2013, the idea was to help the company compete with Amazon and its well-established delivery services for a wide array of consumer products.

Now Google is re-evaluating those efforts and apparently closing two Google Express delivery hubs in San Francisco and Mountain View, as it works to slash the costs of the service, which is provided by local drivers and vehicles. The closing of the two hubs was reported in an Aug. 19 story by VentureBeat.

Google Express later expanded into San Jose, then into Santa Monica and Los Angeles in southern California as the company worked to find places where it could better compete with Amazon's delivery strengths, according to earlier eWEEK reports.

Google declined to comment in response to an eWEEK inquiry about the reported shuttering of the two delivery hubs.

The company reportedly is not giving up on its Google Express services but is moving away from hub-based delivery operations as part of a new business strategy, according to a spokesperson.

Several key executives from Google Express left the company over the last year, including Tom Fallows, the original product management director for the business.

When Google expanded Google Express into Santa Monica in January 2014, it was only made available to company employees and a select group of local applicants as a trial project. The Santa Monica pilot followed the original pilot that launched in March 2013 in San Francisco.

In San Francisco, the program began with same-day local deliveries for online orders from national chain stores such as Target, Walgreens, Staples, American Eagle and Toys 'R Us/Babies 'R Us, as well as smaller local retailers like San Francisco's Blue Bottle Coffee, the Bay Area's Palo Alto Toy & Sport and Raley's Nob Hill Foods. Later, additional retailers joined the service, including DODOcase, Guitar Center, L'Occitane, REI and Whole Foods.

When Google launched the San Francisco program, it also debuted new Google Shopping Express mobile apps for both Android and iOS so that customers could make their purchases and receive product deliveries even when they are away from their homes or offices. To use the service, shoppers can browse the Websites of participating stores, make their item selections, provide personalized delivery instructions for the third-party couriers who will bring their packages, and get their items delivered on the same day.

The Santa Monica pilot program offered deliveries for $4.95 from each retailer after the free six-month trial period.

In the San Francisco service area, product prices for the items ordered and delivered through the service are the same as prices that consumers find in their local stores, according to Google. Shoppers can also add their retailer loyalty program numbers at checkout to take advantage of member prices. Deliveries can be scheduled from early mornings until 9 p.m.

Google certainly has been experimenting with e-commerce for a long time, with its Google Payments, Google Wallet and Google Checkout products. In February 2013, Google bolstered its online sales capabilities by acquiring Channel Intelligence, which lets consumers buy products directly through product pages on Websites. One of the company's products, its Buy Now app, shows potential buyers a dynamically updated list of online retailers that have an advertised product in stock, where the consumer can purchase the item instantly with a click.

Not all of those efforts have been successful, however. In November 2013, Google ended its Google Checkout service. After being created in 2006, Checkout allowed customers to make purchases of services or physical goods from online vendors, but it apparently outlived its usefulness for the search giant because of a lack of satisfactory demand. Instead, Google began expanding its related Google Wallet payment services.

Same-day delivery service certainly isn't an invention of Google. In October 2009, Amazon launched same-day delivery services in seven major U.S. cities as it expanded its buying options for its customers.

This is not the first time that Google has dabbled with the idea of same-day delivery. The idea has at least been in discussions since late 2011, when the company began its Google Product Search service.