Google Goes Shopping


Google needs to keep the lights on too, right? It’s got bills to pay, kids to feed and so forth. So wanting to get revenue from a product it’s managed for more than a decade out of the kindness of its heart makes sense, right?

Well, if advertisers agree with the above sentiment, they should have no problem with the recent news that Google Product Search will now be known as Google Shopping and it will function solely on a pay-for-play model.

For companies with merchant center accounts, Google Product Search was a revenue driver that asked nothing in return. Unlike many of the paid comparison shopping engines (CSEs) in the market today, it provided a no-fuss marketplace where your data and your offer set you apart. It established an even playing field where any advertiser could come out on top simply based on a lower price point, a clean product catalog and a few good user reviews.

A Change of Heart
Google took pride in the simplicity and honesty of this model. In fact, paid inclusion was something it audibly renounced with Google Product Search. It was assumed that once the paid aspect entered the picture, it would sully the results — i.e., advertisers would be paying for position, not earning it. And going forward, the cleanliness and relevancy of an advertiser’s data will still be an important determining factor in how much exposure they get. While Google will be making money off the process, it will look to maintain its standards for this platform.

You Pay for What You Get
Going forward, if advertisers want their presence on Google Shopping, they will have to pay for it. Google Shopping will drive just as much traffic as Google Product Search — if not more. It will still be the most dominant engine in the CSE landscape. Paying for inclusion simply means advertisers will have to put more effort and thought into their CSE budgeting exercises from now on. Additionally, they’ll need to put an even greater emphasis on data cleanliness, which may also cost them.

After everyone comes to terms with the initial “sticker shock” associated with Google Shopping, they’ll realize that, as with almost all of Google’s recent changes, there are going to be positives and negatives.

Positives

  • This will be a revenue driver for Google from now on, so it’ll be putting more resources towards product enhancements to provide the best possible offering.
  • Cleaner product data will help make the product an even more trustworthy source for shoppers.
  • Google Shopping will likely still be a more efficient and effective revenue source than similar “paid” shopping engine experiences such as Shopzilla, Shopping.com and Nextag.

Negatives

  • For merchants, this means that a once free and incredibly effective tool is now going to cut into their return on investment (ROI) or whatever acronym they use to gauge success.
  • Merchants will have to be selective when selling products through Google Shopping — handpicking products to sell based on conversion rate and ROI, instead of simply throwing everything at the wall and “seeing what sticks.”
  • Large and medium-sized advertisers will most likely be able to adapt, but smaller advertisers who relied on this as a free revenue source may not be as capable of transitioning.
  • For the advertisers who continue to list their products, they’ll have to shuffle around budget devoted to their CSE program.

Long story short, this has been a free product that Google has offered for nearly a decade. It has generated billions of dollars for advertisers over the course of those ten years without generating a penny for Google in return. It’s not a shock that it are making this move. The monetization of Google Product Search was bound to happen sooner or later. Whether they’re doing it for the right reasons (i.e., user experience vs. bottom line) is really irrelevant at this point. The advertisers will receive value in exchange for their investment moving forward.

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Chris Reebie
Chris Reebie

Chris is a director on the search team at Empower, where he has been helping brands successfully devise, implement and manage their paid search initiatives for almost a decade across a wide variety of industries including retail, consumer packaged goods, pharmaceuticals and education. His forward-thinking tactics focused on the areas of bidding, targeting and testing have helped ensure his clients can successfully navigate the hostile waters of the highly competitive paid search industry.