Dive Brief:
- Google Express is closing its only two delivery hubs in San Francisco and Mountain View, CA, in an effort to retool the same-day delivery service.
- Available in seven major cities nationwide, Google Express typically partners with retailers to deliver goods the same day or overnight.
- Tom Fallows moved from Google Express to Uber last year, and the effort has seen unsteady leadership since.
Dive Insight:
Google is shutting down Google Express hubs in San Francisco and Silicon Valley in an apparent move to retool logistics for the same-day delivery offering. The hubs were an outlier in Google’s attempt to take on Amazon Prime’s same-day delivery offerings and other on-demand shopping services; Express relies on retail and shipping partners for same-day service in the five other major metropolitan areas it serves.
Google is likely trying to reduce costs by getting out of the warehousing part of logistics, instead outsourcing delivery to startups specializing in fast fulfillment such as Postmates, Flywheel, Deliv, and Instacart. The service has also faced staffing challenges throughout the organization, with little stability in leadership and the Teamsters promising to unionize local Google Express employees in California.
The search giant's other steps toward e-commerce have also face headwinds, with shoppable Product Listing Ads inspiring a European antitrust investigation.