Google retail stores could be a smart move, analysts say

Opening physical stores could be a good way to show off the capabilities of its devices

Opening its own brick-and-mortar retail stores could help Google sell more of its Chromebooks, Nexus tablets and other hardware, analysts said Friday, reacting to online reports that Google may soon be coming to the local shopping mall.

Google is in the process of building its own retail stores and hopes to have the first stores open in time for the holidays in major U.S. metropolitan areas, according to a report Friday in 9to5Google, which cited an unnamed, "extremely reliable" source.

"Google feels right now that many potential customers need to get hands-on experience with its products before they are willing to purchase," the website reported.

Google's Android is already the dominant mobile operating system for smartphones, but the company is trying to make greater inroads with its laptop computers, known as Chromebooks, and its Nexus tablets.

The company is also developing Google Glass, a head-mounted augmented reality system that people would wear to give them real-time information throughout the day. And Google now owns Motorola's handset business.

Online, Google's products are currently sold through its Play digital storefront and through Amazon and some other retailers. Some products can also be bought in pop-up or smaller stores within Best Buy and Staples.

But having its own retail stores could increase consumer awareness around its growing line of physical products and potentially increase sales, analysts say.

"I wouldn't put it past Google to do this," said Ben Bajarin, principal analyst with Silicon Valley-based Creative Strategies.

Regardless of whether the products are actually bought in the store, the strategy could help demonstrate their value, he said. Google's mobile devices are not pushed in physical stores like Best Buy as effectively as they should be, he said. "The stores' sales teams push different products different weeks," he said.

"Google does not have as many products as Apple, but it has enough to justify a physical retail presence," agreed Greg Sterling, senior analyst with Opus Research.

Even if consumers don't buy the product on the spot, they could get a better feel for it in a physical store staffed by Google employees than they could by reading about it online, Sterling said, especially for a cutting-edge product like Glass.

But Google will have to think carefully about its approach. After all, Gateway went the retail route to sell its personal computers and accessories, "but that largely failed," Sterling noted.

Zach Miners covers social networking, search and general technology news for IDG News Service. Follow Zach on Twitter at @zachminers. Zach's e-mail address is zach_miners@idg.com

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Zach Miners

IDG News Service
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