It has been reported that Amazon has stopped bidding on Google’s Product Listing Auctions as of April 28th. Google’s Product Listing Ads are ads with product images that appear at the top of certain search results. Amazon had been a top bidder in that auction for a year and a half. In the meantime, Amazon had been cultivating a competing product. What’s next and how this affects your business.
What is Google’s Shopping Ads Program?
Google’s Shopping Ads program is an enhanced version of standard AdWords advertising. It allows a merchant to upload a feed of their products, including photos. It results in an attractive product listing at the top of Google’s organic search results.
The benefit of a Shopping Ad is higher click through rate (CTR) that Google’s Support Page reports can be as high as 300% better than standard text ads. The leads are better because a user is able to view product information before clicking an ad, so they know what they are clicking to when they click the shopping ad. These ads tend to take up more space in a mobile device, crowding out the organic results.
Is the Competition Between Amazon and Google Intensifying?
I asked PPC expert Jim Stratton, PPC Director at Jason Hennessey Consulting about Amazon’s possible next move and he said,
“This might be a battle between Amazon and Google where Amazon was trying to gain insights to further advance their own bidding systems and technology.”
Putting on my tin foil hat, I noted that Amazon’s participation may have helped drive the up the cost of Google’s Shopping program, possibly discouraging some advertisers from competing on Google Shopping Ads against Amazon. Jim expressed interest in the idea:
“…strategic bidding to pump up the cost of Google’s PLA and make Amazon’s more attractive is an interesting concept.”
Amazon is Google’s Competitor
Amazon is a formidable competitor for shopping advertising. As YouTube is a search engine for videos, Amazon is where consumers go directly to search for products.
Amazon is not just an online marketplace. Amazon is a shopping search engine. A shopping search engine is the most profitable slice of Google’s pie and that makes Amazon Google’s biggest threat because of Amazon’s PPC program.
Takeaway for PPC and Merchants
Jim Stratton believes this is a moment of opportunity for merchants.
“The opportunity for PPC bidders, with Amazon dropping out, this opens up the space for competitors. Those advertisers who have been historically competing with Amazon will see their ad positions increase, higher click through rate percentages, and increased click volume, which will lead to higher ad spends but proportionally higher sales and profits.
I believe that this will open up the space for new advertisers who have been sitting on the sidelines because they didn’t want to battle Amazons deep pockets for their respective products and categories.”
So it may be that the moment is now for merchants to give Google Shopping a try because now is as good as it’s going to get. Read the full story at Merkleinc.com, Amazon Abruptly Shuts Down Google Shopping Program
Images by Shutterstock, Modified by Author