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Zagat acquisition just the start for Google’s ‘local’ strategy

Thierry Monjauze (pictured), Managing Director at Harris Williams & Co, comments on the announcement that Zagat is to be acquired by Google…

Google’s interest in local services and advertising (Local) goes back several years, but the related strategy has seen a number of false starts, both via internal initiatives and inorganic endeavours. There have been strong strategic merits for Google to be a meaningful player in Local but views on the appropriate avenue for attacking the market have varied. 

The Zagat acquisition reinforces a continued desire to tap the significant Local market opportunity via relevant, searchable content (ratings, reviews, recommendations, etc.) and potentially provides the much needed glue for what is becoming a portfolio of Local services, including Google Places and Google Deals, as well as related features like Hotpot. 

I expect that we will continue to see additional transaction activity by Google in the sector in pursuit of the USD20bn+ local advertising market opportunity in the US.”

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