Google to Include Rival Shopping Results

by Mike West on Thursday 28 September 2017

What Happened?


Back in June, news broke from Brussels of an EU ruling stating Google had been abusing its search engine dominance by promoting its own sponsored listings above rival services. The growth of the shopping format over the last 2 years, as well as a couple of recent re-shuffles to the results page, meant that a product related search would now almost always see the shopping results displayed above all other listings. These are followed by Google search ads, and then finally by the organic results. This meant a user was much more likely to click on one of Google's own listings rather than one of the rival services. The EU decided that this was unfair, illegal, and worthy of a heavy (and record breaking) fine of €2.42bn to boot.


Google, of course, disagreed. They argued that all recent changes have been made with user experience in mind; if consumers found these changes forceful and unhelpful, they would have stopped using Google services over time. Since there has been only strong growth in the product, it is therefore in Google’s best interest to not compromise the service it provides. Nevertheless, the ruling was made, and Google have had to make meaningful changes to the format, without putting in jeopardy one of their most valuable, and fastest growing, sources of revenue.


What were Google's options?


One option would be to move the listings to a less prominent position, e.g. below the organic search results. This would be damaging to the product as a whole and  would arguably negatively affect user experience, and still not provide any other CSSs (comparison shopping services) with the opportunity to utilise this ad format. Another option would be somehow highlight that these are Google specific owned ad units and not representative of all options. This, however,  would not likely be enough to placate the EU.


The decision that has been arrived at, then, is really a stroke of genius. Google have come to a solution which allows shopping to remain as the most prominent listings served for product related queries, whilst (on paper) opening the format up to all other comparison engines. How? By adding two words to the ad format: ‘By Google’.


What does this mean, practically?


Beyond adding these two words, Google is implementing a change which will allow other CSSs to place their own shopping listings in the shopping ads real estate. This means that if you are currently running activity through Shopzilla or Kelkoo, for example, you will be given the option to extend your reach to include Google shopping ads. These ads managed via a third party will display the name of the site that the listing is managed from in the same spot currently sporting ‘By Google’. A click on the product will still lead directly to the advertiser’s product page (as it does currently), so the comparison engines won’t actually be seeing any incremental traffic to their own sites from this initiative (you can navigate to the site by clicking ‘by [sitename]’ but this will be a small amount of traffic). 


These non-Google listings will presumably need to follow all the same guidelines that advertisers running through GMC and Adwords do at present. Google will need to ensure that the quality of listings, the user experience, and the accuracy of the data (e.g. is the price correct? is the item in stock?) are aligned across their own listings and the newcomers; Google will also ensure no duplication of products from the same retailer are present from ads from Google directly or a CSSs. It’s possible CSSs will be able to offer some help with the process of feed alignment, but it does mean there is likely to be a requirement of being a pre-approved partner to be eligible to utilise this new opportunity. Importantly from the EU perspective, there will be no reserved spots for Google or any other CSSs in any auction – all listings will be allocated based on relevance, quality score, and bid, as they are currently. 


What does this mean for advertisers?


If you are running your ads through GMC / Adwords currently, the impact will likely be very limited. Most importantly, any listings which are provided by a third party CSSs will not be included in Google’s reporting metrics. Your impression share and click share metrics will be calculated out of the Google managed spots in each particular listing, i.e. ignoring any spots that were taken by other CSSs. This will potentially have the impact of reducing the total number of available impressions through Adwords driven Google shopping campaigns, but to what extent will depend on a) the uptake of this format on the CSSs side, b) any other changes made to the ad format, e.g. the recent change from 15-30 slots.


If you are currently running non-Google CSSs activity, we anticipate that there will be an option to opt-in to Google shopping as a format. In terms of pricing, we would expect running on Google shopping via a CSSs to be more expensive than running directly through Adwords, but it’s not yet clear how CSSs will price this activity. We expect that Google will charge the CSSs in the same manner as it would charge any direct advertiser running through adwords, but the CSSs will likely need to add their own adserving cost on top of this as performance data will be obtained from the 3rd party CSSs directly.


These few points together raise an important question: If you want to expand your current CSSs activity to Google shopping, which requires a feed complying with Google shopping specifications (at least to some extent), why not just run the activity through Adwords with more data points? Further to this point, how many advertisers that are running CSSs activity and looking for opportunities to expand are not already utilising Google shopping as a channel? These two questions will heavily impact the uptake of this option.


What should you do next?


If you are running adwords shopping campaigns – no action is required. Keep a close eye on the SERP over the coming weeks for any changes in terms of format, number of listings, or anything else that you may be able to gain insight from and leverage for your own campaigns.. If you are running through a CSSs and not Google shopping then this will give you an opportunity to do so, but we will need to wait and see what platforms will be supported and what the requirements will be to get it up and running. 


Is this the end of the argument?


Almost certainly not. The initial reaction from CSSs seems to be generally negative. The reason behind this is that Google have essentially introduced a way for these sites to recoup some of the traffic they are losing, but by paying Google for the shopping ‘inventory’. There is a feeling that this misses the point raised by the original ruling, and that the organic (and free) traffic they should receive from their relevant search results are still being pushed down the page with priority given to paid listings instead.


The one thing we know for sure is that Google shopping has grown over the last 18-24 months from being an afterthought to, in many cases, providing the lion’s share of traffic for many retail advertisers. Continue giving shopping campaigns (and the product feed) the attention they deserve, monitor the SERP closely, and keep a close eye on any changes in performance. It is very likely that this is a gesture which will result in very little change in itself, and that the squabbling over Google giving preferential treatment will continue.