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Cloud technology, used to host websites and store data, is a key
part of many retailers' e-commerce operations. As fees are often
pegged to site traffic, a jump in activity will drive up revenue
for the unit.
Carrie Tharp, vice president of retail and consumer at Google
Cloud, told Reuters that her team had this year tossed out its
linear growth model to predict how many servers it will need to
process web orders for retailers around Black Friday.
"We're planning for peak on top of peak," she said on Monday.
That could be a boon for Google Cloud, which has generated about
30% of its revenue during the fourth quarter the last two years.
Stores such as Kohls Corp <KSS.N> and Wayfair Inc <W.N> lean on
Google months in advance to ensure it has enough servers to
withstand increased shopping during holiday discount days such
as Black Friday and Cyber Monday in November and December.
This year, Black Friday-style demand has flooded shops since
March, when the United States began lockdowns, Tharp said.
Holiday shopping is expected to boost demand further, as
retailers including Target Corp <TGT.N> and Walmart Inc <WMT.N>
have said they will reduce in-store hours because of coronavirus
concerns.
Tharp said the pandemic has already benefitted Google Cloud,
with some retailers adopting its predictive algorithms years
ahead of plan to help them work out the most efficient way of
fulfilling orders.
Electronics retailer Best Buy Co Inc <BBY.N>, for instance,
announced on Tuesday a multi-year deal to centralize customer
and product data with Google Cloud to improve its loyalty
program and online ad campaigns.
The companies declined to elaborate on the deal, but Tharp said
she hopes it leads to Google eventually powering Best Buy's web
ordering system.
(Reporting by Paresh Dave; Editing by Jan Harvey)
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