Google Shopping – like most Google products, we’ve seen this platform grow and evolve. It originated as Froogle, then became Google Product Search before settling on Google Shopping in 2012, and now as we creep into 2013 the platform is about to undergo an even more fundamental change.

Google Shopping as we know it gets its listings from crawling the web and retailers submitting product feeds through the Google Merchant Center. The latest update, due in the UK and 9 other countries in February, will see Google Shopping move over to a commercial model, built on PLAs (Product Listing Ads). Completion of the roll-out is expected by the end of Q2 2013.

This means that product listings will now be paid for, built on the Google AdWords CPC (Cost Per Click) model.

As with PPC (Pay Per Click) campaigns this means that the retailer or merchant will only pay for the listing when a user clicks on it. It will also be compulsory to set up a Google AdWords account in order to serve and maintain the listings.

The listing’s prominence in the SERP (Search Engine Results Page), be it in the ‘Search’ or ‘Shopping’ tab, will be determined by the pre-set bid on CPC, quality score (relevance) and CTR (Click Through Rates).

One of the primary reasons given for this transition into the CPC (Cost Per Click) model is to “get better data from merchants in order to build a better shopping experience for [the] user.”

“We believe that having a commercial relationship with merchants will encourage them to keep their product information fresh and up to date. Higher quality data—whether it’s accurate prices, the latest offers or product availability—should mean better shopping results for users, which in turn should create higher quality traffic for merchants.”

Google Shopping

Expected benefits

Increased CTRs and conversions – More targeted listings mean that search results are expected to be more relevant, therefore increasing click-throughs and conversions.

The new Google Shopping has already been rolled out in the US and some companies are already reporting more clicks and higher CRs (conversion rates) from the new CPC model as early as October 2012. With these reports, UK retailers can feel confident that with efficient optimisation and upkeep, their new investment will pay off.

Product level bidding – For the most granular of product targeting, you will be able to optimise bids for individual products

More relevance for the user – It seems Google is trying to find a balance between a comprehensive list of results and bombarding the user with potentially irrelevant search results when all and sundry are submitting product feeds. In theory, this means that the user is more likely to find what they are looking for faster. Only time will tell if the Google Shopping CPC model achieves this.

Potential downsides

For the user, the ability to browse through a huge number of products to find exactly what they want can be appealing. Moving over to the paid inclusion model may mean that fewer results appear, all with high relevancy to the search term. While relevancy is a good thing, finding little gems amongst the large listings may no longer be possible.

For retailers and search specialists, the concern is that if Google is transitioning its shopping product into a paid-only listing, what’s to say that other Google products aren’t to follow? With justification for the CPC model pointing towards relevance and filtering, surely most of Google’s products, including organic web search, are liable to fall into the same potential pitfalls?

My personal feelings on the upcoming changes to Google Shopping are that the potential benefits will outweigh the pitfalls; with effective optimisation and maintenance of feeds, retailers can expect higher click through rates and conversion rates. Retailers will also be able to push specific products by optimum bidding, aiding with seasonal trends.

4Ps isn’t just another PPC management agency. To discuss how paid search strategies are evolving alongside new developments in ad technology and tracking, give us a call on +44 (0)207 607 5650 for a no-obligation coffee and chat about data, marketing and user behaviour across all inbound channels. How could a performance marketing agency like us help your brand?