19.07.2012

New Google Shopping: Striking Business Shift For The Comparison Ecosystem? (PART 1)


It is very early to predict exactly how new Google Shopping results change the e-commerce sector. First monitoring shows unclear results. So the mercent blog shows how the new Product Listing Ads (PLA) are decreasing in relation to the previously free Google Product Search (GPS). Interestingly they measured the traffic of the major US comparison search engines going up. However in another post they state that there is a variety of non-economic reasons for these figures. Hard to say how the PLA will influence the organic Serps...

Stop for a moment! What was actually the role of the previous Google Product Search? Yes, there was no cost involved! Advertisers got an injection of free traffic. Considering the merchant’s total media budget the ROI would shrink without that portion of Google traffic, right? The size of that unexpected cost is quite significant: According to cpcstrategy GPS was the main comparison search engine based on revenue for merchants. About half of merchants who responded to a recent study said that at least 20% of their website sales come from GPS. For those who are excellent optimizers the share certainly must be higher!


So without knowing the exact traffic differences it is worth to draw a scenario for the price comparison microcosmos. We will look at the market participants as there are merchants, comparison search engines (CSE’s) and arbitrage sites that use product feeds provided by the CSE’s. We will discuss how the metrics change without the free traffic form GPS. We will consider the strategic options. And we will raise the question who will profit and who will face harder times.

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