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Why Amazon Is Going to Launch a Search Engine (Thinks Out Loud Episode 345)

Screenshot of the soon-to-be retired Alexa.com to illustrate why Amazon will launch its own search engine

It’s time for a (semi) bold prediction: Amazon is going to launch its very own consumer-facing general search engine. Yes, they’ve got search on Amazon.com. Yes, they’ve got Alexa. But the evidence suggests that there may be something bigger in the works. And that’s a really Good Thing for your business even if it doesn’t catch on right away — or ever.

What leads me to think this is coming? Why is it good for your business if Amazon launches its own search engine even if it fails? And what should you do if it comes to pass? This episode of Thinks Out Loud takes a look at why Amazon is going to launch a search engine and uncovers some answers for you.

Want to know more? Here are the show notes for you.

Thinks Out Loud Episode 344: Why Amazon is Going to Launch a Search Engine Headlines and Show Notes

Show Notes and Links

Here are this week’s show notes for Thinks Out Loud with links and news related to this week’s episode. Be sure to check out all the links that matter for your business once you’ve given the episode a listen.

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Past Insights from Tim Peter Thinks

You might also want to check out these slides I had the pleasure of presenting recently about the key trends shaping marketing in the next year. Here are the slides for your reference:

Technical Details for Thinks Out Loud

Recorded using a Heil PR-40 Dynamic Studio Recording Mic and a Focusrite Scarlett 4i4 (3rd Gen) USB Audio Interface into Logic Pro X for the Mac.

Running time: 23m 46s

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Transcript: Why Amazon Is Going to Launch a Search Engine

Well, hello again, everyone. And welcome back to Thinks Out Loud, your source for all the digital expertise your business needs. My name is Tim Peter. This is episode 345 of the big show. And I think we’ve got a really cool show for you today.

Predicting the Future…

I’m going to go out on a limb. I’m going to make a big, bold prediction. And in candor, I don’t know that it’s that bold of prediction if you think about it. And I’ll explain that in just a moment.

I believe we are going to see Amazon get into the search engine business in relatively short order, somewhere within the next 12 to 18 months, I would think they’re going to do this. I’m not a hundred percent confident, but I’m reasonably confident. And I’ll talk more about that later.

The reason I want to talk about this today is I want to kind of lay out my reasoning for why I think this is so, talk about why you should care and talk about what you should do about it if in fact it comes to pass. So that’s where we’re going to start.

…Or Maybe Just the Present

Now, one of the reasons I don’t think this is a bold prediction is because they’re already in the search engine business.

There are millions of searches every day on Amazon.com. They ship somewhere around 1.6 million packages every day. And if we assume that there’s only just one search per package shipped — which seems low — that’s 1.6 million searches every day. There are also a couple hundred million Alexa-powered devices in the world. And if we assume just an average of one search per week, that’s still a lot of searches.

Now, adding those two numbers together is still a far cry from Google’s, oh, let’s say roughly five and a half billion — that’s billion with a B — searches every day.

But it’s also not nothing. It’s a decent number. So for me to say that Amazon is going to launch a search engine, it’s not really predicting the future, it’s really predicting the present. It’s a thing that they’re already doing.

The Case for a Consumer-Facing Amazon Search Engine

But what I mean is that I think they are likely to introduce a search engine that is consumer-facing, web-based or mobile-based, that can be used as an direct competitor to Google, or at least as an alternative to Google for certain types of searches beyond just e-commerce. That’s really what I mean.

Google Threatens Amazon’s Business

And here’s why I think that. Now we know that Google is the biggest search engine in the world — outside of China, Russia, and South Korea anyway. And I also assume North Korea, I don’t really know the answer to that. But Google’s even increasing share in South Korea.

Google needs to get better at e-commerce. Yet Google has a big hole in their success, we know that most product searches begin on Amazon. Google knows this too, and they’ve been making an enormous number of changes to get more heavily into e-commerce, to teach customers that you should really start your product searches on Google, just the same as you start all your other searches on Google.

The Bill Ready hire. First in 2019, they hired Bill Ready from PayPal to be its "president of commerce payments and next billion users." I always think "next billion users" is one of the scariest phrases ever. You think Google’s big enough and they have ambitions of saying, "No, there’s another billion people out there we need to find." I suspect some of those users could be existing users who just choose someone else, i.e. Amazon to do their product and shopping searches.

The Shopify partnership. Google also partnered with Shopify on improving online checkout and eCommerce experiences.

The commerce advertisements. And last fall Google launched an entire series of commercials showing searchers finding products locally using Google.

There could be other reasons for this behavior by Google. Obviously, a big shift in customer behaviors during the pandemic may have said this was something that they needed to do. But given that Google hired Bill Ready in 2019 pre pandemic, I think they already understood the challenge and were already acting on it.

Amazon’s Smart Devices Business

At the same time, Amazon is selling lots of smart devices. We know for sure there were over 200 million sold as of January 2020. I’ve looked for more recent numbers, but I haven’t been able to find anything credible that shows exact numbers. I do think it’s safe to assume that the number has gone up a fair bit. An article in TechHive said that in Q1 of 2021 sales were up across all smart speakers by 141%.

The Alexa name has cachet. And all of these different smart devices that Amazon offers or powers use Alexa as their interface, as their voice interface. And that name is really important.

They’ve got a website called Alexa.com used for… something else. Most people probably don’t think about this, but Amazon has a site on the web where you can interact with Alexa without speaking to a device. It’s just a website at the URL "alexa.amazon.com." You might know that. You might already use it.

You may also know that Amazon also owns a website called Alexa.com. They’ve owned it for years. And Alexa.com offers web usage statistics to digital professionals.

I’ve used it, gosh, since the mid-90s or so. There used to be a tool bar you had in your browser before Amazon owned it. So it’s been around for a really, really long time.

They’re shutting down the existing Alexa.com. And in December, that December of 2021, Amazon announced that they’re shutting down Alexa.com in May. So about a month from when I’m recording this.

Wait, what?

Putting the Pieces Together

Amazon owns a valuable domain, tied to the name of one of their most successful products, that offers a completely different functionality from that name… And they’ve decided to shut the older product down? They’re just going to turn it off?

That seems unlikely.

It seems far more likely that they’re not going to turn it off, they’re going to turn it to a new purpose. They’re going to use it for an entirely different reason.

Sidebar: What Are Domains For, Anyway?

I always think of domains, I always think of URLs as real estate. And when you think of real estate, you tend to think in terms of how do we develop this real estate in a way that it actually benefits our business, that we are getting the greatest utilization of this asset that we own?

I suspect Amazon looks at its product portfolio. It looks at its most successful physical product that’s ever built and says, "We have some assets that are related to this very successful product, that are being used in a very different way, and in a way that doesn’t support this very, very, very popular product. Why do we do that? Maybe we should actually make those work together."

The Likely Reality: Amazon Wants its Own Search Engine

And so to me, this seems pretty likely that they want to give Echo devices and the Alexa search capabilities, a public face in a more robust way than they’ve done from this, than they’ve done already.

There are other reasons Amazon might care about more general search as well.

Changing Customer Behavior Also Threatens Amazon’s Business

Google has shared data that we’ve seen big changes in customer behavior during the pandemic. Searches for local businesses grew more than 80% year on year in 2021. Searches for the words "Who has" followed by "In stock" grew more than 8,000% in the same period. People are looking for things nearby that they want to get… right now. Searches on Google Maps for "curbside pickup" grew over 9,000%.

Now, maybe these were all building off small bases, which is entirely possible, but anything that goes up 8,000% or 9,000% is a trend you’re going to want to pay some attention to.

There’s No Way Amazon Doesn’t Know These Facts

And I would be shocked if Amazon wasn’t seeing similar trends between what people type in the search box on Amazon.com and what they ask physical Echo devices, the things most of us call Alexa.

They have to be seeing similar trends. They haven’t expanded same day delivery for nothing. They also undoubtedly see all the searches on their website that fail. And I’m quite confident that lots of people on Amazon.com and on Alexa — on Echo devices or Alexa powered devices — use search terms unrelated to shopping for products.

I’ve seen that behavior for years with hotel and travel websites and clients in other industries. People use search boxes to search. I’m sure it’s not large percentages in Amazon’s case, but given their traffic volumes, given the number of searches that they’re seeing, I bet it’s still a meaningful number. And again, not only have I seen the behavior, Google has been teaching people to do this for, I don’t know, decades, a really long time.

Amazon Wants the Data

So it seems logical, it seems obvious that this is something Amazon needs to get better at. We know that data is the crown jewels. I’ve been talking about that myself for gosh, almost 10 years or more. And Google has so much more data about what customers want than Amazon does. Amazon has to get the data to learn more about customers. And I think that’s a huge driver of why they need to get into search more broadly.

Also, y’know, Potential Revenues and All That Jazz

Yes, I also think it can help them generate additional revenues. And given the fact that Google is starting to tromp through their garden in terms of e-commerce, I suspect they have some interest in taking the fight to Google on the other side.

Why You Should Care About Amazon and Google

The reason I’m even talking about this all today is because I think this is a really, really good thing for your business.

And you’re probably saying, "Why? Why do I care?" Well, there’s a couple reasons. First, the enemy of my enemy is my friend, right? Google dominates in search engine market share. And we know that gatekeepers are going to gate and Google has increased its gatekeeping activities a fair bit in the last few years. We’ve seen an enormous rise in how it’s creating the zero click search phenomenon by giving people answers to questions without requiring them to click to get that answer.

We know they’ve increased the number of ads that people see and the number searches on which people see ads. And we know that ad prices even allowing for some differences during the pandemic, we know that ad prices have gone up. It’s costing you more money to acquire traffic, period.

Competition Among Gatekeepers is Almost Always Good For Your Business

And greater competition for Google tends to cause companies like Google to rethink how it approaches the marketplace for business.

I saw this years ago when Booking.com first emerged in North America and when Expedia really went hard into Europe. Booking.com was the largest player in Europe, Expedia was the largest player in North America. And as they expanded into each other’s territories, their behaviors on behalf of their customers, on behalf of the hotels and travel companies that they partnered with got better, they behaved themselves more.

The Big Challenges Amazon Faces in Search

I also want to acknowledge two realities here…

Amazon is a flawed champion. The first is that Amazon is a flawed champion. They’re a gatekeeper too. And their history shows that they’ve generally been pretty aggressive with regard to competitive tactics and probably more so than Google themselves. They’re known for playing rough with people who they compete with and frankly, the people who use them as a channel partner. They can play hardball, right?

Amazon is backsliding a bit at customer experience. The other thing we need to acknowledge is that there’s no guarantee that they will succeed. Product search on Amazon is at least in my experience getting worse, given the number of paid placements Amazon uses. Google much to their credit realized a very long time ago that even advertisements need to be a good answer to the questions customers are asking if you want to keep those customers coming back.

Say what you want about the ads on Google, they tend to be pretty solid answers to the question. And say what you want about the ads on Amazon, they often are not good answers to the questions people ask. I’ve seen more and more examples. I’ll probably post one as one of the images today of searching for product A and being shown products X, Y, and Z, before you can even find product A on the page.

Search is hard… and Google has a massive head start. The last thing that is true here is this is going to be a rare case where Amazon is operating as an underdog. They have a steep learning curve in terms of how to make a general search engine work. And it’s not a simple problem to solve.

Google’s technology is much, much better. I will post a link in the show notes that shows some new language models that Google is using that come across as damned near human in terms of "you’re looking down at the clouds and you get up and go to the restroom. You unbuckle your seatbelt, get up and go to the restroom." And the language model takes it for granted that you must be on an airplane just from that bit of data. Now to people, that’s common sense. To a computer, that’s super hard. And I’m not sure Amazon knows how to do that today.

Google also per what I said a moment ago does a better job on focusing of getting the customer to the answer they actually want.

Getting customers to switch… ain’t easy. And lastly, and by no means least, customers would have to think Amazon is better enough than Google to switch and actually use it. So I think there’s lot of uphill here that has to happen.

What Should You Do With This Information?

Now the question is, what do you do about it? What do you do with this information?

How Likely is it that Amazon Will Try to Launch its Own Search Engine?

Well, at the moment, first, not much. We have to see if my prediction even comes true and they’re only shutting down Alexa.com in May of 2022. It might be a year or more before we see that turned to a consumer-facing enterprise. I would be surprised if it took that long. But I think if they’re going to do it, it could take a little bit of time. I’m only about 70% confident, maybe 80% confident that they will even do this. So if they don’t do this within the next 18 months, I won’t be entirely shocked. I’ll be a little surprised, but I won’t be shocked.

How Likely is it that Amazon Will Succeed?

We also know that Amazon has frequently made moves that later they backed away from. So it’s possible they could launch this and then decide, you know what? It’s just not working. It’s not worth the effort.

And given those realities and the challenges I just mentioned, I’d give the likelihood of them actually succeeding at competing head to head with Google at maybe 25% to 30%, maybe. I will update that over time based on what I see or hear or learn about their commitment and actions that they take.

Google, Amazon, and Preying Mantises

I also would say that even if they launched it June 1st, you still want to approach them cautiously.

It’s good that Google has competition. We want to see people compete with Google, but I would approach Amazon the way a male praying mantis approaches a female of the species. Yes, there are some potential benefits from folks coming into the market and competing here. You also might end up losing your head.

So you would approach them very cautiously as I always advise with pitting one gatekeeper against the next.

You Can Win Even if Amazon Doesn’t

The last point to hear though, and to me, the most exciting part is Amazon doesn’t have to succeed for you to see the benefit, they just have to scare Google enough to get big G to change the way they do the things that they do.

In fact, I think that they already are.

Google is clearly concerned about the number of people starting searches on Amazon, hence their interest in eCommerce, local shopping, and the like. They’ve been genuinely helpful and genuinely a good partner during the pandemic for many small businesses and quite a few large businesses too. So wouldn’t it be good if there was another outside threat, one that wasn’t, I don’t know, a global pandemic that forced them to be better still?

That would be amazing. I welcome this.

Conclusion: Why Amazon is Going to Launch a Search Engine

So is Amazon going to build a general search engine? Maybe… but I’m inclined towards yes.

The key question though, is will it benefit you if they do? And to me, the answer to that one is clear, absolutely. And that’s why we should all be encouraging them to do it. So when you think about talking to your Alexa today, remind her that it’s not a bad idea if she starts answering more questions for more people… because your business will benefit in the long run.

Show Outro

Now looking at the clock on the wall, we are out of time for this week. I want to remind you that you can find the show notes for today’s episode, as well as an archive of all past episodes by going to TimPeter.com/podcast. Again, that’s TimPeter.com/podcast. Just look for episode 345.

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Sponsor Message: SoloSegment

I’d also like to thank our sponsor, Thinks Out Loud is brought to you by SoloSegment. SoloSegment provides search as a service to help customers of large enterprises find the content they need. Use SoloSegment to power your search results that focus on business results and help your customers find the content that matters to them.

SoloSegment does this using artificial intelligence, machine learning and a host of other cool technologies while also protecting customer privacy and improving your business results along the away. You can learn more about SoloSegment and all the wonderful work that they do by going to Solosegment.com. Again, that’s solosegment.com.

Show Outro

Finally, I want to say how much I appreciate you listening to the show every single week. It means so much to me that you take a little bit out of your very, very valuable day and your very, very valuable time every single week to listen to Thinks Out Loud. It means more than I can say and I just wouldn’t do the show if it wasn’t for you.

With that said, I hope you have a great rest of the week. I hope you have a wonderful weekend and I’ll look forward to speaking with you here on Thinks Out Loud next time. Until then, please be well, be safe. And as always, take care everybody.

Tim Peter is the founder and president of Tim Peter & Associates. You can learn more about our company's strategy and digital marketing consulting services here or about Tim here.

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