What Marketers Must Know about Google Shopping: What Is It Today and What It Can Be Tomorrow

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What Marketers Must Know about Google Shopping: What Is It Today and What It Can Be Tomorrow

One of the many challenges search marketers face is developing strategies to keep up with a constantly evolving landscape. One recent change that has generated great interest is the switch from Google’s free Product Search feature to a paid version: Google Shopping. This is a big deal because, before the switch, retailers typically drove 5 to 10 percent of search traffic via Product Search. This means that if they choose not to pay, brands will have to adjust their budgets or potentially lose this search traffic to competitors.

Paying for something that used to be free doesn’t sound so appealing, but this change isn’t necessarily a bad thing for marketers:

  • There should be less clutter on the SERP, which means you are more likely to get the click if you maintain your feed properly.
  • Merchants who previously attempted unethical feed practices, such as switching prices or redirecting landing pages, will be eliminated. This should increase consumer trust, leading to more traffic and sales through this channel.
  • Google expects better feed management because advertisers will be paying more attention to performance given that they will have to meet efficiency goals.

In other words, the change from a free service to a paid model could actually mean more profitability for your search program overall. And early returns show that this could very well be true. For instance, Google is reporting that brands have seen CTRs improve by more than 100 percent, sales increases of 10x, and declines of more than 35 percent in CPA.

Though most brands shouldn’t expect to see these kinds of gains, it is still encouraging to see that theoretical performance improvements are being seen in practice.

So how can you help ensure that you see these improvements?

You’ll need to model what the impact will be on your online marketing budget based on current forecasted activity. In other words, you’ll have to account for the extra spend associated with Google Shopping and decide where those dollars should come from. It will be necessary to create a buffer to account for unpredictable fluctuations in volume and/or performance given that so much is unknown about this new offering.

Though Google Shopping is not keyword based, your SEM bidding strategist will likely be best equipped to optimize the program. Marketers will be able to bid, control, and optimize via attributes in the feed, managing through AdWords. And to find the best mix of Shopping and SEM, a certain amount of testing and learning will be vital.

While there will be many unknowns in the next few months, there are a few steps you can take now to position yourself for success:

  • Coordinate your SEO/SEM strategy, as the transition will have interrelated effects on organic and paid search. A holistic approach will help you understand the overall change in cost, optimization, and product visibility, which will then allow you to make strategic adjustments to increase performance across all search.
  • Continue to focus on quality feeds and improve your inventory management processes. It will be more important now than ever to identify product attributes that provide differentiation in the marketplace. And to guarantee accurate measurement, you’ll need to ensure tracking parameters are properly set up.
  • Keep an eye on your competitors, because watching what the competition is doing can help you assess where the opportunities are in terms of products and categories. Additionally, you can compare your brand’s ratings and reviews to identify weaknesses that can be addressed.

The official switch to the paid model was October 17, but you should expect the changes to keep coming as the data rolls in. In 2013, we could see integration with Google+, new reporting dashboards, or improvements in Google Offers. It is hard to say for sure what will happen, but as with all things search, staying on top of changes and being nimble enough to adjust to them quickly will be paramount.

As if to prove this point, one day after the switch Google announced an update to Shopping: promotions.

The new feature will provide a scalable way for marketers to distribute coupons and promotions, and it will present further test-and-learn opportunities for the holidays. You will need to maintain an additional feed, which could require additional resources. A compelling reason to make this investment is that you will have the ability to tie the promotions into offline sales with the help of a unique coupon offering.

Ultimately, Google Shopping should result in an improved experience for consumers, who will find a cleaner SERP and have another reliable option for finding what they want. Typically, what is good for consumers is good for retailers, especially in search, and that should be the case with Google Shopping, as well. One thing is for certain: When you have this figured out, something else is going to come along that will make you rethink your whole strategy.

But that’s why we love search.


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Jason Hartley

Jason Hartley is Associate Media Director at digital agency 360i. His specialty is in retail SEM.

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