Today, Amazon is opening a physical bookstore in Seattle’s University Village. Meanwhile, across the country, Google has reportedly decided not to open a planned stand-alone retail space on Greene Street in SoHo in New York.
In addition to selling books, Amazon’s retail store will allow users to “test drive” the company’s devices: Kindle, Echo, Fire TV and Fire Tablet (no mention of Fire Phone). There were previous rumors that Amazon was going to open a New York retail space or was going to buy part of the bankrupt Radio Shack chain, neither of which came to pass.
Depending on the Seattle store’s performance and public reaction, it’s possible that Amazon would open additional physical locations. It currently has a retail store on the Purdue University campus.
Google has opened several pop-up stores in the past and has store-within-a-store operations in several locations, including US Best Buy stores and “The Google Shop” in London. However, the New York location was different from those previous efforts. It was a 5,442-square-foot retail space that Google apparently spent millions renovating. Now, according to reports, it’s going to sublease the space and wants something like $2.25 million a year.
It’s not clear what happened or why Google changed its plans (assuming the report is accurate). Years ago, Google had fewer reasons to open stores. However, now it has multiple hardware products that it could effectively showcase in an Apple-like retail environment.
Apple has hundreds of physical stores around the world, which have been critical to its brand and sales success. The company’s stores have the highest sales per square foot of any US retailer. Microsoft several years ago followed Apple and opened its own retail locations.
Physical retail stores are part of a larger effort to bridge the gap between online and offline commerce, which Google and Amazon have also been seeking to do with same-day delivery services. And despite the significant growth of e-commerce, more than 90 percent of US retail sales still happen in physical stores, offline.