Google to Open Its First Offline Store Outside US, in India

Key Takeaways

• Google is finalizing a location for its first international offline store in India, highlighting its focus on the country as a key growth market.
• The store (expected to be 15,000 sq. ft.) is part of Google's $10 billion investment in India. However, legal and regulatory hurdles, including ongoing antitrust cases, may slow down the process.
• Apple's success with its offline stores in India may have influenced Google's decision. While Apple dominates the premium smartphone market with a 55% share, Google Pixel holds only 2%, making this move a strategic push to gain a luxury market presence.

Alphabet Inc's Google is reportedly in the final stages of closing a location in India for its first international offline store. This huge step reflects how Google views India as a key growth market and values its growing clientele in India.

This is a smart move as India is Google's one of the largest markets in the world. The country has seen a consistent rise in its tech demand, especially in the mobile segment, with approximately 712 million smartphone users today, indicating good potential for Google to grow.

Currently, there are 5 brick and mortar stores of Google that sell Google Pixel phones, smartwatches, earbuds, and other Google products. All five are situated in the US at prime locations in New York, Boston, and California.

With this project, Google promised to invest about 10 billion dollars in the country. While it isn't clear how the money shall be utilized, the store is expected to be around 15,000 sq. ft. and may take another half a year to complete.

However, there have been conjectures about legal and regulatory challenges that will take some time to be resolved before the stores can be set up. This includes the ongoing antitrust cases over its in-app billing system and abuse of market position in the market for smart TVs.

The sources declined to give further details on the issues being faced but assured that the company is firm on its decision to establish walk-in stores in India and will figure out a way to make it happen.

Claims have been made that the first location is in the satellite city of Gurugram, near Delhi. The next outlet can be expected in Mumbai.

When asked about the company's plans regarding opening an outlet in Bangalore, the source deflected saying these two cities are the priority, and if the brand sees success, further locations can be explored.

Could Apple's Offline Store Be an Influencing Factor?

Until recently, Both Google and Apple products were sold through authorized retailers or through online platforms like Amazon. That changed when the CEO of Apple, Tim Cook opened the company's first company-run store in Mumbai and eventually expanded to Delhi.

Apple stores have helped skyrocket sales and build better customer connections, resulting in an increase of billions in revenue. If executed well, this move aligns well with Google's new motive to capture the luxury market segment of mobile phones.

Currently, Apple has more than 500 offline stores around the world and continues to grow steadily in the luxury segment of mobile phones, with ownership of more than 55% of the market share while Google Pixel has around 2% ownership.

Google would like to improve on these numbers, hence, it is now willing to explore markets outside the US.

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