EcommerceBytes-NewsFlash, Number 2832 - June 22, 2012     4 of 5

Survey Reveals Impact of Google Shopping on Merchant Sales

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Google shook up the ecommerce industry in late May when it announced it would stop including product listings in Google Shopping search results unless merchants paid for inclusion through Google Product Listing Ads program beginning this fall.

A survey of EcommerceBytes readers taken after the announcement found that Google Shopping was a significant source of traffic to their product listings, both on their own ecommerce websites and their marketplace listings. The majority of respondents (86%) said they were currently sending Google Product Search feeds to Google. However, 61% of respondents said they would not participate in Google Product Listing Ads when Google Shopping moves to a paid-only service.

Many online sellers used the comment field to express their disappointment in Google, and some said they would stop using other Google services such as Google Checkout to show their displeasure with the company's decision to end free listings on its shopping search engine.

Impact of Google Shopping on Merchant Websites
Over half of respondents (54.2%) said at least 20% of their website traffic came from Google Shopping. And the traffic Google Shopping is sending to the merchants' website is converting into sales. Half of respondents (49.4%) said at least 20% of their website sales come from Google Shopping.

A significant number of online sellers do not know how much traffic and sales are generated through Google Shopping. Twenty percent didn't know how much traffic Google Shopping generated to their website, and 22% didn't now how much of their website sales came from Google Shopping.

Impact of Google Shopping on Merchant Marketplace Listings
Almost 57% of respondents who sell on marketplaces said at least 20% of traffic to their marketplace listings came from Google Shopping, and 47.6 said at least 20% of their marketplace sales came from Google Shopping.

Participation in Google Product Listing Ads
Only a small percentage (8.9%) of EcommerceBytes readers responding to the survey said they currently participated in Google Product Listing Ads, a paid offering on Google.

When asked if they would participate in Google Product Listing Ads when Google Shopping moves to a paid-only service, 4.8% said they would, 61% said they would not, and 34.2% said they did not know.

Disappointment with Google
Survey respondents were allowed to leave comments, and many expressed disappointment with Google, saying they would find it difficult to pay for exposure on Google Shopping. "I am an online micro-seller. I do use Google Checkout with my own website, with eCrater, and with Bonanza. There is probably no way I can afford to pay Google to have my thousands of products listed when it becomes a paid service." Another said, "All product feeds are submitted by Etsy. How this will affect my two stores there... only time will tell! Just can't be good." Some respondents said they would stop using all of Google's services to protest its new policy.

Some respondents said they would begin using Bing, TheFInd, or other search engines. One seller wrote, "It will depend on where the buyers go. It sounds to me since the biggies are going to pay to play, it would be hard to convince shoppers to use a different search engine."

Another respondent wrote, "I'm a part-time, small-time seller online, and without my listings going to Google Shopping I might as well close my stores. The playing field was somewhat level with the use of Google Shopping for us small-timers, but now? It will soon become a faded memory I fear. Congratulations, big-time e-tailers...you've won."

One seller said the change would be good for eBay: "Google's plan may bring to them more revenue... but in the long-term, I think it will HELP EBAY as well. Sellers like me - who have benefited greatly from the Google product feeds, and who have been able to realize a bit of independence from eBay as a result - are likely to return to eBay in order to recover some of the volume that's likely to be lost as Google eliminates the free product-feeds. eBay may not be the be-all/end-all vehicle for sales (as it once was), but for my purposes, it's still a good place for me to meet new customers and introduce them to my web site for future repeat business."

Additional Comments
Other comments include the following:

"There is no way a small merchant like myself can compete with the likes of Amazon, Buy and the other big companies that will be able to monopolize GPLA with big CPC bids, just as they do on Adwords now. Will focus more on the free (for now) shopping engines like The Find. I predict that by the fall, only big merchants will still be on Google Shopping."

"I liked Google Shopping because it fit into our company's start-up budget for advertising: nothing. We gained exposure for nothing up front. We worked hard to make sure that all of our listings were compliant with Google's required format, but now I guess we won't have to spend that time and money doing that. I think that this is pathetic. Is Google in such a bad financial position that it can't seem to manage it's corporation without charging merchants for listing their products in a comparison shopping engine that was originally free? They set the precedence, they should keep things the way they are. This was the one of two ways that we as a small business could get ourselves known without forking out a lot of money. A company would do well to create their own search engine to compete and allow businesses to list their products for free."

"Don't care why kind of "spin" Google puts on this, it's simply another case of large corporate greed. So what this gets down to is that the large companies that have large ad budgets will only get bigger and more dominant and the small e-tailer will have an even harder time getting their product offerings in front of consumers. If this was a flat fee and everyone was on a level playing surface, then it wouldn't matter as much. But you know that the large outfits will simply post large bids and drive the small sellers to the bottom of the pile (just like google search ads)."

"Not likely to use this service. Can't afford to pay."

"My internet store sites rely on whom I list on to send my items to google, i.e. Bonanza, Ecrater, Tias. I have no website of my own. This will hurt my sales tremendously. I am hoping that all the sales I made in the past, that my customers will remember to find me again at my sites. I USED to sell exclusively on Ebay in the beginning, but got away from their many rules in governing how a sale should be made. Hope you might give us some suggestions to be able to survive through this change. Please help!"

"They may be shooting themselves in the foot. Fewer Google Shopping hits = fewer purchases by shoppers = less revenue fees for Google Checkout. Good bye Google search, hello Bing."

"As a small merchant with limited resources and...being a sole proprietor antiques and collectibles dealer with mostly one of a kind items....I don't have the time or resources to figure out keywords let alone bid against the big boys for placement. This will be a further nail in the coffin of small online businesses...and as usual for Google...it will be in place just before the holidays...our best time of the year that usually recoups the rest of the year and adds a cushion for the down months the following year."

"All depends on the cost, have paid for their merchant program before and my sales actually fell. Guess it will all depend on if sales drop off (which they probably will based on times our feeds have been dropped). Currently have found that there is a direct relationship between placement on google shopping and placement on google organic. Really upset to hear this from google."

"This is not being done as an improvement for customer shopping. This is being done to improve the revenue at Google and shareholder price. However, this is going to hurt Google in the long run. Google will be seen as just another paid site with incomplete listings and fall below Yahoo. Nobody has the time to figure all this out or the bottomless pit of cash that Google wants. I will rely more on listing on other sites such as bookfinder.com and viaLibri."

"This is definitely disappointing news, as it will be another expense for small retailers like myself."

"Not only will the new paid model close the door on the small businesses that use the service, it will also limit the shoppers options to find what they seek. If the point really is to provide a better shopping experience it will not work, as there will be many businesses who will no longer be represented due to the cost, mine included. If the point of Google Shopping is to help shoppers find the exact item they are seeking, no matter where it might be, large corporation or one person indie business, then stick with the current model."

"I am dropping Google Checkout and will no longer offer this payment option to buyers in my three on-line shops."

"This is a bad move for consumers akin to eBay pushing "free shipping". These kinds of corporate moves just drive up costs for consumers because it drives up cost for merchants. An economy that is struggling to grow and improve will not sustain such economic costs. Shame on you Google."

"Google is being evil."

"With this change, Google loses all appeal as a shopping search engine. As a buyer, I will no longer utilize Google shopping since their results will no longer offer a broad view of items and prices available. I will not have my selection limited to sellers who will be charging higher prices in order to cover the cost of Google ad listing fees. Time to remove Google from my browser toolbar and replace it with Bing."

"This will kill my business I have worked on for the past 6 years. Google Shopping is our best and steady sales channel, especially since the last Google change to organic search. We lost our ranking and sales and have traffic dropped, for reasons we are not understanding. Most if not all of our sales now come from Google Shopping, it is the only place many shoppers find us as we rank very well on most item listings. Once this goes into effect, our business will probably fail. This is a sad way for Google to treat their sites that always sent in frequent and updated feeds. Greed will continue to ruin small businesses."

"Wow, way to get everyone to play by your rules and then just up and change them like a spoiled child who isn't getting his way. I guess I missed the memo on how amazing the economy is doing. Do small business owners have another dime to donate to Google? I don't."

"I hope Google reverses its decision. I imagine a large percentage of Google searches is for a particular item or items that the person is interested in purchasing. If people no longer are able to search for items, it seems to me it would be detrimental to Google since people will by-pass Google searches altogether and go straight to eBay or Amazon, thus hurting the people/companies which are paying to be seen. Seems like a lose lose situation for all concerned."

"I am a Ruby Lane shop and currently see all my listings in shopping. If RL increases its costs to cover Google paid shopping I will no longer be able to afford selling there. Doing this just before the holiday shopping season shows Google's true, screw you attitude towards the online sites. Too many eBay people working there now - shame on them!"

"Unfortunately it will make Google Products useless by limiting the number of products offered. As a merchant, it is not viable, ROI is too small. As a buyer, it will be a disaster. Bing, here I come."

"Google Chrome is now off my desktop. Google will also be eliminated from my Smartphone."

"Excellent way to rid out freeloaders and make real fashion exchange sellers to pay for their way, or else, hit the road jack!"


About the author:

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.


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