EcommerceBytes-NewsFlash, Number 2817 - June 01, 2012     1 of 4

eBay Reacts to Google Shopping's Decision to Drop Free Listings

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Online merchants were in turmoil today over news that Google will drop free listings in its Google Shopping search engine and move to a pay-to-play model by the fall. Small marketplaces that depend on traffic from Google search were incredulous that Google actually intended to eliminate free listings, while giant eBay said it would continue to participate in Google Shopping via the paid listing ad program.

eBay's head of Internet Marketing Robert Chatwani said eBay was one of the earliest adopters of Google's Product Listing Ads at scale. "We've developed sophisticated capabilities to generate strong buyer demand for our 25 million global sellers through our relationship with Google. We are evaluating the impact of today's announcement, but we also plan to fully participate in the new Google Shopping offering, and continue to harness the power of Google's ad offerings on behalf of our sellers and merchants."

It's unlikely eBay or others would speak too critically of Google, given they must rely on whatever traffic they can get from Google - free organic search on Google.com or paid ads on Google Shopping. When eBay and Google got into a spat in 2007, it hurt both companies (Google vs. eBay: Round One).

Google will begin transitioning its shopping site to a paid model beginning in the summer, and the transition will be completed by fall. Starting this week, it will experiment with the Google Shopping widget on the Google.com search results pages.

Google Shopping VP of Product Management Sameer Samat told EcommerceBytes Google would begin testing a new format "that makes it easier to find products you are looking for on Google.com." Samat also said that moving to a purely commercial model would make Google Shopping results more reliable.

Google Commerce, headed by former eBay executive Stephanie Tilenius, has good relations with large retailers who are the most likely to benefit from this week's announcement.

Another big winner could be Microsoft's Bing search engine, which also has a dedicated shopping engine (Bing.com/shopping) where it displays product listings at no charge, and where items from small marketplaces such as Addoway, Tias.com, eCrater, RubyLane.com and Bonanza appear in search results.

Take a survey on the impact of Google Shopping on your traffic and sales and comment on the AuctionBytes Blog. Also see, "How Will Google Shopping Changes Affect eBay, Marketplaces?" on the EcommerceBytes Blog.


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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