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eCommerce: It’s Ever-changing Marketplace

Google is the Wal-Mart of search – the biggest in the game. So, when Google makes a change to its Google Commerce offerings for online merchants, the Internet world shakes like a snow globe.

In October, Google ended Google Product Search – a comparison-shopping search that provided free listings to e-retailers. At the time of its termination, it was ranked number one among comparison shopping engines.

According to CPC Strategy’s 2nd Quarter results, Google Product Search was number one in driving revenue to merchants, as well as conversion rate percentage (orders received for number of clicks). Obviously, it was good for e-retailers. So then what was the problem?

I bet we can take a guess – it wasn’t so good for Google, because it was free. Now online merchants will have to allocate part of their ad budget to get product listings on Google Shopping (the name “Google Product Search” has been completely phased out), bidding higher to increase their ranking. Or, they can rely simply on their AdWords , Pay Per Click, or Search Engine Optimization (seo) strategies to get noticed.

On Google Shopping, product listings now all include a product photo. The new term for these listings is PLAs, or Product Listing Ads. Merchants who have made the move are reportedly doing well.

One, Ben Skigen, the e-commerce director for ToolKing.com, which has some 120,000 SKUs to promote in new paid listings, told MultiChannel Merchant blog that he welcomes the change because Google Product Search had become clogged with “low quality sites and affiliates.” Skigen is featured in a YouTube video uploaded by Google Business, describing his company’s better conversion rates (up 50 percent with the PLAs) and higher average order value (up 15 percent).

As a strategy, the Search Engine Watch blog suggests that merchants approach the bidding for PLAs by segmenting their inventory by profitability. That way they won’t be paying the same to list a product that might earn 10 dollars as one that nets 90 cents.

Watch These Marketplaces, Portals, and CSEs

E-retailers who cannot afford to pay for PLAs so their product can appear on page one of the search results in Google Shopping can still get free placement on comparison shopping engines (CSEs) Bing and TheFind (“every product, every store, every sale, coupon, and discount”) or they can be creative with social media site Pinterest, which is becoming an important shopping portal and might even edge out Google Shopping. Recently Amazon.com edged out Google in traffic among comparison shopping sites, with 30 percent of shopping searches beginning at Amazon versus Google’s 13 percent, according to Forrester Research as reported on Search Engine Watch.

Pinterest, with its attractive product photography coupled with a viral tool, the “Pin” button, would seem to be a natural marketplace. Pinterest is making moves to become a bigger player in e-commerce. In October it announced that it will offer users the peace of mind that comes with knowing they are dealing with a legitimate website when they are interested in a product.

As an e-retailer, one should realize that although Pinterest users are good prospects because they have emotional involvement with the products they pin or re-pin, they don’t want to be treated the way one would a buyer who came to an e-commerce site via a product search. There is a different set of rules: Be thoughtful when engaging people who’ve repined a product photo, but do be proactive, advises an article on Web Pro News.

Among CSEs that perform well for merchants is the under-the-radar Pronto.com, which ranked second in conversion rate (orders/clicks) after Google Product Search in a comparison done by CPCStrategy.com this past summer.

In this changing marketplace, it’s anyone’s guess how the rankings will stack up a year from now, or whether shoppers and smart e-retailers will put their money in entirely different sites.

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