How is Google taking on Microsoft Office in retail?

Carrefour represents a big-name contract win for Google’s G Suite, but will Microsoft Office still be dominant across retail?

Grocery chain Carrefour’s strategic partnership with Google may have drawn headlines about the possibilities of developing voice-tech-enabled shopping and consumer experiences using artificial intelligence (AI), but it has huge ramifications behind the scenes, too.

The June announcement that the France-headquartered retailer and the global technology titan are working closely to create Google Assistant services and to combine innovation lab expertise also involved a notable day-to-day software tie-up.

Carrefour will deploy Google Cloud’s G Suite productivity and collaboration technologies, comprising communication tools Gmail and Hangouts, and organisational tools Calendar, Drive and Docs, to more than 160,000 employees.

Wrapped around these services will be the acceleration of the Google Cloud Platform (GCP) infrastructure, while staff training on the new tools is already under way – aimed at adding flexibility to everyday working practices.

It was in 2006 that Google launched its Microsoft Office alternative, Docs & Spreadsheets, which was followed early in 2007 with the roll-out of Google Apps Premier Edition, which Computer Weekly reported on at the time as a Microsoft Office challenger.

In retail, specifically, one of the largest private-sector employers in western Europe, there are some marquee users of its current G Suite incarnation, including AllSaints, Decathlon, John Lewis Partnership, Ocado, and now Carrefour. But Microsoft Office 365 revenue from business customers increased by 38% year on year in the three months to 30 June 2018 alone, so it doesn’t appear to have been thrown off track too far.

Like any competitive corporate, Microsoft will not like losing big customers, but the cloud services space is where today’s key battle exists – and G Suite/Office is just one layer of that.

Difficult job for Greene

Ben Kepes, a technology analyst at investment, analysis and advisory business Diversity, says: “Microsoft has a massive franchise among existing enterprises. Add to that the fact that Microsoft Azure has a head start when compared to Google’s Cloud Platform, and you have a difficult job for Google Cloud CEO Diane Greene to take market share from Microsoft.

“But relevant market share between the various players is probably the wrong lens to look at this. Cloud generally is growing hugely and there is more than enough market opportunity for Amazon Web Services, Microsoft and Google to all make trillions of dollars from it in the years ahead.”

Google’s UK head of retail, Andy Burgess, says there is no one reason why retail companies migrate to G Suite from Microsoft Office, and he acknowledges it is often part of a wider cloud technology provider decision process. But he argues that collaboration “is so much easier in Google than in Microsoft”, and says his company is making good progress in taking market share.

He adds: “Collaboration is quite ephemeral – if you don’t get it right with the tools on offer, people will say they’re not going to use it and will go back to the old ways of working.”

Burgess says it is becoming “a much more difficult decision between Microsoft and Google now” for retailers because there are multiple opportunities at stake. He suggests that Microsoft is giving its incumbent 365 base credits for its Azure cloud platform, trying to tie in wider services – but Google has similar tactics.

“We are talking to a lot of businesses where there is a bigger decision to be made,” he says. “We are starting to bundle in the ad side because we have all this data that we can bring into play – and that’s a huge advantage if a retailer is doing AI [artificial intelligence] or machine learning because they can combine Google data with their own, and really leverage real-time insights.

“That’s what Carrefour is buying.”

Turning heads

Another recent convert to G Suite is UK grocer Morrisons, which is closing in on three years as a user. Having initially taken Google’s software for its head office, the retailer has now deployed G Suite and its array of components across its 495 stores and for 125,000 employees.

Morrisons technology director Jo Graham, who is responsible for retail, says the biggest difference G Suite has made relates to collaboration and how information is shared between senior staff and employees alike, via Communities on Google Plus.

“I think things happen faster – you don’t have that lag or lead time in people sharing information,” says Graham. “As things are happening, you are working on the job as other people are.”

Morrisons launched Google Communities within the wider business earlier in 2018, starting off in fruit and vegetable quality control, where staff were encouraged to share images if customers had complained about products or if a colleague noticed something unusual.

“We know who the supplier is and who the grower is, and we can work out if it’s a systemic problem, or a problem isolated to a single store,” says Graham. “My team and I are on these communities from a technology perspective, so we can see issues as they arise.”

She notes that the tool has been a way of getting staff on the shop floor engaged in wider business issues, and she offers examples of how employees have started conversations via this forum that, in some cases, introduce new ways for the group to work.

Read more about retail technology adoption

Graham also says that PAs who look after executives in the business have effectively become “super users”, advocating the adoption of G Suite as it continues to upgrade its features.

Specsavers is an example of a retailer that moved to Google before reverting its email, comms and collaboration software licence back to Microsoft last year.

Phil Pavitt, former global CIO of the optical and hearing products retailer, says Specsavers’ international business used Google Docs and Gmail as standard when he arrived in 2014. His remit was to lead a widespread IT transformation involving core systems and infrastructure, and that movement – by chance – led to Google being phased out and Microsoft Office returning.

“Specsavers was using Google Sheets and the like relatively successfully across the organisation instead of Microsoft Office,” he says. “There were often difficulties when importing Word and PowerPoint, but Google was the default international choice.

“It wasn’t on my list to sort out because everything else in the project was so huge. But we were buying other Microsoft products, such as bits of Dynamics, and CRM [customer relationship management], and we began to see the benefits of an entire Microsoft integration.”

Pavitt adds that when his team worked out what the company was paying for conference calls and other communication tools, on top of the Google products, it realised that Microsoft licensing covered its needs and – for Specsavers, at least – was cheaper.

“It wasn’t a smooth user journey across Google product sets and the security team were very nervous,” he says.

G Suite customers range from traditional retailers to those with digital at their core, but as analyst Kepes explains: “Google seems to have an edge with those whose primary focus or use case centres around machine learning and AI.

“But, again, the market is growing hugely and most enterprises into the future will leverage a range of public cloud vendors.”

Mixing it up

At Morrisons, all staff are now presented with G Suite tools – a significant cultural shift from three years ago, when Microsoft software supported the retailer’s back office.

There are some core finance spreadsheets still on Excel – and Burgess acknowledges there might be “one or two” employees who have steadfastly refused to give up their Outlook – but, fundamentally, Morrisons has chosen Google over Microsoft.

This is indicative of the wider market – and you can point to Marks & Spencer’s recent commitment to Microsoft as a balancing example. Microsoft and Google appear to be driving each other on to produce better-quality packages, and the bigger retailers will tend to pick one or the other, largely dependent on their overall cloud platform requirements and company vision.

Even if Microsoft Office’s dominance of the enterprise software market has largely not yet been affected by G Suite taking customers, there is, at least, competition now.

And in some cases, there are major software supplier combinations appearing within retail organisations.

Global beauty brand Rituals is undertaking a major roll-out of Apple iPads and iPods in its stores and behind the scenes. With Office 365 supported by OS and iOS, and Rituals able to choose from a range of Apple applications for internal communication, the company runs with a hybrid of supplier software.

“The hardware we use is Apple, and the management of that is done by [Apple specialist] Jamf, which includes putting the software and applications on the device and aligning security,” says Joost van der Zwaan, IT infrastructure architect at Rituals.

“We use Office 365 as an email platform, but as a company we use ‘best of breed’. 365 works for us, but we have also used Google’s email in the past. We moved to Microsoft because we think it’s a better solution, but we still use lots of Google products.”

Huge data lake

Although 365 is chosen as the core package, van der Zwaan says Rituals’ “huge data lake”, where all retail management information is stored, is in Google’s platform.

“I think there is a place for both Office and G Suite in the market,” says Pavitt, who is now helping startups in fields ranging from robotic processing automation to blockchain, while offering IT infrastructure guidance to big businesses on a non-executive basis.

“Microsoft was quite expensive, the functionality was narrow, and it wasn’t the most integrated solution. Now, the idea that you can be on Outlook, find your contacts and find Skype all by clicking three buttons shows that the integration capability is tight.”

Pavitt adds: “Four of five years ago, everyone was looking at bringing Google in because it was seen as trendy, against the establishment of Microsoft, and the price was pretty much free. Microsoft definitely took account of what Google was doing – Google definitely shook Microsoft up.”

This was last published in September 2018

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