In an announcement made January 14, Google is acquiring Irish startup Pointy. The small company has solved a problem that troubled startups for over a 10 years – how to bring small, independent retailer inventory online.

The terms of the deal wasn’t disclosed to the public, but Pointy raised less than $20 million, meaning it probably wasn’t really a huge expense for Google to pick up, although it might have a significant impact for the future of product search.

The acquisition of Pointy will help Google offer more local inventory data in Google My Business (GMB) listings, knowledge panels, as well as ads. This will go quite well with Google Shopping Campaigns’ local inventory ads, which are largely utilized by enterprise merchants.

Although a number of companies tried solving the challenge of how to bring small business product inventory online, most of them failed since most of SMB retailers lacked the sophisticated inventory management systems that cold product feeds and integrate with APIs.

Pointy created a way to get local store inventory online, and then showcase said inventory that inventory in organic search results or paid search ads. It uses a low-cost hardware device that attaches to a point-of-sale barcode scanner. You can see the device above. It’s compatible with multiple other POS systems, such as Square.

After installing the device, it will capture every product sold by the merchant and then create a digital record of products. These records can then be pushed out in paid or organic results. Pointy even creates local inventory pages for each store and product, which are optimized and can rank for product searches.

Although Pointy itself doesn’t understand real-time inventory, it uses machine learning algorithms to estimate this by measuring product purchase frequency. The system will assume that local retailers are going to stock frequently purchased items. This is the gist of how the system works.

Pointy said it a blog post that it “serve[s] local retailers in almost every city and every town in the U.S. and throughout Ireland.”

The Pointy acquisition will likely help Google in at least three ways:

  • Provide more structured, local inventory data for consumers to find in Search.
  • Generate more advertising revenue over time from independent retailers.
  • Help Google more effectively compete with Amazon in product search.

SourceGreg Sterling