Amazon has a new rival: Google has announced plans to turn YouTube into a shopping platform
"Will YouTube become the next shaker?"
Google has announced plans to turn its video site, YouTube, into a shopping platform to become a rival to Amazon and Alibaba, Bloomberg reported.
YouTube is more of an advertising platform than an e-commerce giant, with viewers watching a video and then clicking on a link to jump to another platform or digital store to shop. But now that YouTube is not content with just earning revenue from ads and subscriptions, Google wants to turn YouTube into a one-stop shopping destination.
People familiar with the matter said Google would turn the vast number of videos on YouTube into a huge catalog where viewers could click and buy directly without having to go online on other platforms such as Amazon.
To that end, YouTube recently began asking some of its creators to tag the products they display in the video and link the product data directly to Google's analytics and shopping tools.
A YouTube spokesman confirmed that the company is testing some e-commerce features on some video channels and that creators will be able to control which products are displayed on its channels, but declined to give further details.
Google has suffered a number of setbacks in online commerce, with little success, and YouTube has finally chosen advertising as its main revenue stream. But this year's outbreak has hit Google's marketing budgets hard, particularly in travel and brick-and-mortar retail.
At the same time, e-commerce is booming. In May and July of this year, Facebook and Instagram launched the "Facebook Store" and "Instagram Store", inviting merchants to come in and grasp the new trend of "social e-commerce". Google is still on the sidelines. Amazon's sales surged in the second quarter, but Google suffered its first revenue decline.
The e-commerce retail market, excluding China, is likely to grow to $2.8 trillion by 2025, according to Bloomberg, and analysts say Facebook is leading the way.
Obviously, Google doesn't want to miss a chance longer. For months, Google executives have hinted that YouTube will be at the heart of its e-commerce strategy. On a recent earnings conference call, Sundar Pichai, Google's chief executive, said YouTube's Shanghai volume of "unboxing" videos could turn into shopping opportunities, so YouTube could return to its $15bn business at the end of last year.
It's unclear how YouTube will benefit from these sales, but YouTube has started offering subscriptions to creators for a 30 percent commission. In addition, Google announced that it would integrate with e-commerce platforms Shopify and PayPal to help merchants manage inventory, meaning it wants to steal more businesses from Amazon.
Amazon and Wal-Mart have been subsidizing shopping videos for years, but the results have not been significant. But in China's live broadcast, commodities such as lipstick have generated hundreds of millions of yuan in real-time trading.
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