Google announced that starting this week listing a product for sale on their shopping tab would now be free.
The tech giant, Google, is going back to its roots and making their shopping tab platform Merchant Center free for e-commerce business. Bill Ready, Google’s president for commerce wrote that the change has come to help with the increasing threat to retail and the growing demand for e-commerce, especially now as the world is in lockdown.
Mr. Ready continued; “With hundreds of millions of shopping searches on Google each day, we know that many retailers have the items people need in stock and ready to ship, but are less discoverable online.” “For retailers, this change means free exposure to millions of people who come to Google every day for their shopping needs.” “For shoppers, it means more products from more stores, discoverable through the Google Shopping tab. For advertisers, this means paid campaigns can now be augmented with free listings.”
Industry professionals, of course, know this change is also an attempt of Google to expand its role in e-commerce and redirect product-based searches directly away from their main competitor and the lead shopping query platform Amazon.
Competition from Amazon
Globally internet users mainly rely on Google for the answer to their every possible question, however when it comes to finding the perfect product where users go for answers are slightly different. According to a Feedvisor report Two-thirds of consumers now start their search for products on Amazon, and nearly all (95 percent) are satisfied with the results.
While Google could have been the main player in global shopping searches they have fallen behind by focusing on optimizing as an ad platform for marketers, who are looking to direct shoppers toward their offerings, rather than the experience as a shopper and small seller.
Meanwhile Amazon, who has always offered free listings alongside their sponsored products for e-retailers has created a rich shopping experience for sellers and buyers. With a plethora of products and price points available for consumers and the ability to promote products as a seller.
According to Merkle through Amazon’s Sponsored Products, the direct competitor of Google Shopping Ads, Brands advertising saw a 100 percent conversion rate during the first quarter this year. Google Shopping, meanwhile, had a 20 percent conversation rate during the same time period.
How will Google make money now?
Google is trying to mirror Amazon’s e-commerce success by having more products available. Opening its doors to more diversified sellers, through free listings, should help achieve this, and meanwhile, Google’s ad placements on both the shopping tab and the main Google search page will continue to thrive. As users learn to shop via Google there will be more revenue from e-commerce advertisers similar to Amazon.
As is standard, Google will continue to tinker and improve as data comes in. It will also hopefully have more tangible data from the new payment platform partner PayPal, who can give more insights on sale turnover.
Google does have to move forward in this expansion with caution though, as they have come under scrutiny in the past, (2017) by the European Commission, who fined them 2.4 billion euros for abusing its market dominance to give an unfair advantage to its own services.
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During an interview, Bill Ready said: “Digital commerce has a huge opportunity and it shouldn’t be the case that only a handful get to participate in that.”
The free google listings are currently only for US-based brands, but Google is planning on rolling it out internationally before the end of the year. While it’s another exciting platform to reach audiences, brands have to continue to be strategic as Google Ad placements will continue to have the top priority, with free listings filling in the gaps they have in the market.
Brands who aren’t already listed should take advantage and run tests on their ads to see what stands out best to audiences. Increasing findability is the key to reaching new audiences.