Google Shopping or Amazon 2.0?

In the past few weeks, Google has released a new version of Google Shopping, following up with the announcement of a few months ago in which announced this big news. Officially, it is available in the USA and France but it is probably carrying out tests on other countries.

Currently, the platform has not been launched in Italy yet, but we were still able to test it using it from France.

Even though there are several improvements to be made (e.g. products can’t be found even if they appear in the home) it is a very interesting platform with many new features, and some of them have a high impact, both for advertisers and users.

 

WHAT CHANGED COMPARED TO THE OLD VERSION

  1. POSITIONING

The most visible news for the users is positioning: nowadays, the shopping ads are shown in the search results along with the paid and organic results, or the related “Shopping” tab.

The new version will be an ad hoc platform in the shopping.google.com subdomain.

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  1. INTERNAL CHECKOUT

However, the positioning is not the most important news; from our point of view, the most relevant news is being able to purchase directly from the platform, without ever having to leave.

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Staying within the platform to finalize a transaction is nowadays a focal point, which is the reason why Facebook has introduced this feature a few months ago (with the Instagram shopping). In regards to Google, there are several crucial differences:

  • Google Shopping (like Amazon) will work on a search engine, and therefore on an advertising pull since the user intent is well defined;
  • Facebook works on push-type campaigns, in which the user intent is not clear, but the advertiser shows its product/brand according to the chosen targeting.

Additionally, when buying within the platform, the user can take advantage of the Google warranty, with a customer service specially dedicated to refunds and returns.

However, this option won’t be available for all retailers, but only for those who joined or will join the Google Shopping Actions program, created by Google to fully exploit the partnership with different brands.

  1. BRAND PAGES

Additionally, there will be a “container” section within the website, along with a “showcase” page in which the users can find many available products.

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  1. OFFLINE AVAILABILITY

Another step forward, compared to the current Shopping (even if it is already available in other countries), is that Google will show the availability of products in physical stores, taking advantage of the integration with Google Maps: this is the natural continuation of the synergistic activity between online and offline, which has been carried out by Google for a few years (see our whitepaper about Local SEA), and in our opinion, it will become one of the most important topics (if not the most important one).

The total convergence between online and offline on the new Google Shopping is definitely an important step forward towards an integrated and multichannel strategy, which has been carried out by Google for a few years.

  1. REMUNERATION METHOD

An important change for the brand is the answer to the question “Ok, but how is Google being remunerated with the new Shopping?”, considering that at the moment, the engine is paid per click on the Shopping ads, which redirects you to the website. With the new version, instead, the advertisers will pay Google with a percentage of the sales finalized on the platform, as Amazon does. Anyways, it seems that compared to the giant of Seattle, Google asks for a much lower fee.

  1. MONITORING OF PRICES

Even if it is not specified, there will still be the possibility to use a CPC purchase, redirecting the users to the website. In fact, we can still find the comparison of product prices, display of reviews, and eventually, the possibility to visit different websites.

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OTHER NEWS

Where possible, you’ll be able to subscribe to the Newsletter of the Brand during checkout (if it exists, as shown below in the case of Darty and Bayapi):

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Also, it will be also to use promotional discount codes, probably distributed by Google and automatically added to the cart. For those, it will be necessary to add the flag to use them.

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THE CONSEQUENCES

  • IMPACT ON THE TRAFFIC

The new Google Shopping will definitely bring a decrease in Google paid sessions since the checkout will be within the app. Due to the presence of links towards e-commerce within the Google app, you’ll still be able to navigate to the website itself, and therefore, the number of sessions will decrease which will be unlikely equal to zero. Additionally, the promotional campaigns on the research network will keep existing contributing to paid traffic.

  • IMPACT ON SALES

Along with the organic traffic, there will probably be a decrease in sales on the websites: in fact, some of them will be redirected to the Shopping app. The good news is that the total sales could increase, thanks to the warranty and support offered by Google during the pre and post-sale (especially returns and refunds).

  • REMUNERATION

With the new method of remuneration of Google Shopping, advertisers will only pay if a purchase is finalized on the platform, and therefore they won’t have to pay for the clicks towards the site, risking to pay without receiving any return.

 

Google vs AMAZON

With the new Shopping, it is clear enough how Google has challenged Amazon, creating a similar platform that has much lower costs, and therefore, it is more appealing for advertisers. The characteristics of the new Google app, as you can see, are very similar to the ones of the giant of Seattle.

However, the competitive advantage of the new Shopping is not only related to the cost: Amazon is missing the offline feature, which will be one of the strengths carried out by Google. In any case, it is quite possible that in the near future, Amazon will make available this kind of purchase for its users.

Anyways, there is the usage gap of a new platform, in particular for customers who are loyal to Amazon.

The challenge between Google vs. Amazon has just started!

 

Valerio Intini SEA Team Leader at Pro Web Consulting