Point Inside Faces a Big Competitor as Google Starts Mapping Indoors

12/8/11Follow @curtwoodward

When you run a startup that focuses on mapping the floor plans of retail stores, there’s this inevitable question: What happens when Google, the company that has already mapped the entire world, decides to do the same thing as you? Josh Marti, the CEO of Seattle-based Point Inside, has heard it plenty of times.

“And our answer was always, yeah absolutely—whether they use our maps or their own maps, they’re going to see the value that indoor maps bring,” Marti says. His job as an entrepreneur is to make sure Point Inside is offering something more valuable.

That particular part of the job got even more important last week, when Google (NASDAQ: GOOG) announced that it was indeed bringing indoor layouts to the latest version of its maps application for Android.

As we’ve reported before, Point Inside thinks partnering with big players in location services can be good for its business, so I wondered whether Google’s new offering included the Seattle startup’s maps. Turns out, that’s not the case—Google appears to be partnering with retailers on its own, and also appealing to retailers to submit floorplans themselves.

Marti took this challenge head-on earlier this week during his demo of Point Inside at Xconomy’s Mobile Madness Northwest, a packed half-day forum on innovation in mobile computing. As Point Inside also detailed on its blog, the question isn’t necessarily whether Google can successfully map indoor spaces, he says—it’s whether Google’s business model of selling ads within those stores will be appealing to retailers.

To illustrate the point, Marti pulled up Google’s app and navigated over to a Home Depot store. Once there, he searched for “paint,” and was promptly redirected to a Lowe’s down the street.

That got some pretty hearty laughs from the crowd. But it’s serious stuff, both for retailers and smaller companies like Point Inside, which has some 1,300 locations using its indoor mapping service.

Marti puts it this way: Google’s overarching business model has been to index large amounts of information, attract eyeballs, and sell advertising. For a retailer, that could be a scary proposition: If Google makes the map, who owns the advertising inside your own store?

“Right now, the way it’s deployed today, it’s certainly a scenario where if you invite them in, you’d better be prepared to pay them to keep the competition out,” Marti says. “Assuming that the business model for websites is the same business model for physical locations, you’ll see that competitors are going to start buying ad words against each other and ad locations against each other.”

To be fair, that sounds like some pretty classic fear, uncertainty, and doubt from a competitor. And Marti is quick to acknowledge that this is still the very early public version of Google’s indoor mapping product—there’s no definite way of knowing how it will shake out.

But in any case, Marti says Point Inside is confident that retailers will want to retain more control over their shoppers’ trips through the aisles. That’s what the Seattle startup, which presently has about 30 employees and is seeing growing revenue, offers through a white-label service for indoor navigation apps.

“They have a real opportunity to control their brand experience as well as maintain the relationship with their customers,” Marti says. “And that’s an important, lifelong theme for the retailers—they hate to be disintermediated by anybody.”

Curt Woodward is a senior editor for Xconomy based in Boston. Email: cwoodward@xconomy.com Follow @curtwoodward

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  • http://www.pointinside.com Todd Sherman

    An area that is unclear with Google’s entry into indoor maps – especially for retailers – is shown in the above demonstration where someone in Home Depot searches for paint and is sent to Lowe’s.

    As one retailer told us: “It can’t be a process where we invite Google in and then pay them to keep the competition out.”

    For a deeper look at key retailer considerations: bit.ly/vttIXF