The companies announced Wednesday that four Google products will be imbedded into Intuit's upcoming update to its QuickBooks accounting software. This means that Google, which has sought to attract small-business advertisers, will have access to a large number of them via QuickBooks and its 3.7 million users, marketing analyst Greg Sterling said.
"This is a huge market that Google is getting access to in a direct way," said Sterling, founder of Sterling Market Intelligence. "Consider that there are 3.2 million U.S. advertisers in the Yellow Pages. Small business is where all the volume is."
An earlier attempt by Google tocame in March, when it cut a deal with Verizon SuperPages.com to have the classified ad provider help its tens of thousands of marketers get ads onto Google search result pages. But for companies like Google, forming relationships with small businesses has proven difficult. Many neighborhood business owners have been slow to establish a presence on the Web. A big reason for that, says Sterling, is many don't know how.
The Intuit deal gives Google the opportunity to make friends in this community by making Internet advertising less imposing.
For example, business owners using QuickBooks to keep their accounts in order can help customers pinpoint their stores via Google Maps. A Google-enabled QuickBooks will also enable customers to create keyword searches for their products, so that their advertisements pop up whenever someone searches for the product on Google.
Merchants can also upload information about their inventories to Google Base so customers can learn what they have in stock.
"The real issue here is not the sophistication, or lack thereof, of small business owners," Sterling said. "The real issue Google has to be concerned with is time. The company has to make it simple for these time-strapped business owners to learn about online marketing and where to put their money."
Google will only be available in QuickBooks 2007, due to be released sometime this fall. Exact financial details of the deal were not disclosed, but Intuit CEO Steve Bennett said the two would "split the revenues based on the value we each contribute."
In a conference call, Google CEO Eric Schmidt and Bennett said their companies had many similarities.
"We became convinced that there was a way to potentially add a million or more online advertisers to these large networks--particularly Google's network," said Schmidt during a conference call. "To solve (small-business owners') problems, it seemed like a natural partnership between (Google and Intuit), a natural next step in how our businesses evolved."
One other thing the companies share is that they both can say they have bested Microsoft in head-to-head competition.
Microsoft is, of course, trying to challenge Google in search, and Intuit, which sought to merge with Microsoft in 1994, hassoftware. Microsoft did not respond to interview requests.
However, Microsoft's MSN could conceivably cut its own deal with Intuit. According to Bennett, Intuit's deal with Google is nonexclusive.