Google has revamped its shopping tool in Europe and beyond with a new service called ‘Product Listing Ads’, as the web giant looks to extend its hugely successful AdWords model to the world of ecommerce.
The move means that advertisers using Google Shopping now need to pay when searchers click on their items.
Following a launch in the US this year, Google Shopping is launching paid services to the UK, Germany, France, Japan, Italy, Spain, Netherlands, Brazil, Australia and Switzerland.
For the past decade, Google’s Shopping channel has been a free service for businesses, letting firms upload their entire inventory for use in Shopping searches at no cost. Now, businesses will be charged when searchers click on their products in Shopping.
Google is phasing in the transition slowly: and will return a mix of paid-for and free listings in Shopping until summer.
The first phase of the gradual global roll-out will see Google Shopping search results change to include commercial formats labelled as “Sponsored,” appearing now in the space occupied by Adwords ads. The roll-out is scheduled to be complete by Q2 2013.
Google Shopping is already available internationally, but it is currently a basic product search service.
How it works
Google’s new commercial model ‘Product Listing Ads’ tweaks the ranking in Google Shopping to be based on a combination of relevance and bid price.
Unlike normal Google ads, product listing ads don’t require keyword bids. Instead, the Merchant Center scans product feeds to find relevant products for a searcher.It then automatically returns a product listing ad from sellers offering that item. The product listing ads clearly display a large image of the product, alongside price, seller info and availability.
Google is hoping the new scheme will make Shopping more useful for searchers: quickly providing ‘all you need to know’ information within the ‘ad’ itself.
Jonathan Beeston, director, new product innovation, EMEA at Adobe Media and Advertising Solutions, commented: “The arrival of Google Product Listing Ads (PLA) in the UK is a mixed blessing for the advertising world. While retailers will no longer benefit from the free traffic they were receiving from Google product search, it gives advertisers more granular control over product listings, bids and traffic, allowing them to work out what’s going where and when, and distribute budget as necessary.
“In the US so far, PLAs have been a significant and profitable source of traffic, seeing the number of advertisers using them grow by 113% from Spring 2012 to October 2012. As a result the US advertising space has already grown more competitive so it will be crucial for UK organisations to be ready to hit the ground running. With the additional cost involved advertisers will now need to carefully consider spend efficiency at the strategy stage. And this is where learning from the US experience is a real advantage for us; we can see exactly what has and hasn’t worked with their ads.”
As an incentive, Google is offering businesses product listing ads with a 10% discount off PLA spend until June.
“The online and offline shopping experiences are really starting to merge. So we’re launching a new set of tools that help people get the most out of their holiday shopping,” says Jennifer Dulski product management director of Google Shopping.
“These visually cleaner results for shopping queries will enable shoppers to refine a search by brand or price, and feature larger product images to provide a better sense of a product’s attributes,” added Sameer Samat, Vice President of Product Management, Google Shopping.
Watch this ‘Hangout’ video from Jon Venverloh, Senior Manager–Google Shopping, offering a guide to creating and optimising product listings on Google.
