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Google Shopping (“Paid Inclusion” Results) To Replace Product Search

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Google is changing Google Product Search to Google Shopping, and building it on product listing ads.

“When searching for great local restaurants, people want places to eat right there on the results page, not another click or two away. It’s the same with hotels, flight options, directions and shopping,” says Sameer Samat, Vice President of Product Management, Google Shopping. “Organizing these types of data can be very different from indexing the Web, because the information is often not publicly available. It requires deep partnerships with different industries—from financial services and travel to merchants who sell physical goods.”

This sounds very much like those paid inclusion results Danny Sullivan reported on this week, which we talked about here. Sullivan talked about Google “sponsored” results, which are being found in searches for hotels, flights and financial services – all of which are mentioned in Google’s announcement today. He quoted Google’s Amit Singhal as saying:

“Fundamentally, time and time again, we started noticing that a class of queries could not be answered based upon just crawled data…We realized that we will have to either license data or go out and establish relationships with data providers…To be super safe, where we have a deal between Google and another party, we didn’t want to call those fully organic results, because they are based on a deal…After much debate, we said “OK, let’s be extra cautious. Let’s call it ‘sponsored’ so that we tell our users that there’s a special relationship that Google has established with someone.”

In today’s announcement, Samat says, “We believe that having a commercial relationship with merchants will encourage them to keep their product information fresh and up to date. Higher quality data—whether it’s accurate prices, the latest offers or product availability—should mean better shopping results for users, which in turn should create higher quality traffic for merchants.”

Google talks about how to create a new product listing ad here:

The transition from Google Product Search to Google Shopping will be complete in the fall, Google says. Google is giving Merchants who create product listing ads by August 15, a 10% monthly credit of their total Product Listing Ad spend through the end of the year. Current Product Search merchants can get $100 AdWords credit toward the ads if they fill out a form before that date.

Google says ranking in Google Shopping will be based on “a combination of relevance and bid price,” the same as Product Listing Ads today, and those who want to stand out can participate in Google’s Trusted Stores program. The program saw a limited launch last fall:

Merchants will also be able to standout, using special offers, Google says.

In Google.com results, the Shopping results will appear as “sponsored,” as discussed by Singhal. Google shows the following example for “telescopes”:

Telescopes on Google

It sure seems like there are a lot of ads “above the fold”. I thought Google didn’t care for that much.

“These new formats are clearly labeled ‘sponsored,’ and take space currently occupied by AdWords,” says Samat.

But it looks like there will be plenty fo AdWords ads on the page too.

Google is, however, also putting the “sponsored” results in the area where other queries will return Knowledge Graph results:

Telescope sponsored result

These types of search results have been described by Google recently as a “third kind of thing” between organic results and ads. Sullivan has made a point to referr to them as “paid inclusion” results, and to point out that this kind of thing was considered “evil” by Google back in the IPO days.

Things change (and Google doesn’t call it paid inclusion).

Google Shopping (“Paid Inclusion” Results) To Replace Product Search
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  • http://www.allforyourwedding.com mark

    Many small companies have used Google ( Froogle, Base, Shopping ) as their resource for free advertising of their products. This is just an attack on those small companies and only allow companies who can afford to pay to do so.

    The only thing I think Google should do to help the small companies is make a CPA Cost per acquisition model were a small amount say 5% of each sale would be taken.

    • nakaduke

      This is clearly an attack on small business that use Google Shopping to advertise products. Google basically used their user data for the future purpose of creating this mess. Who is making these decisions? What the users think is no longer important? Its all about money now and I really think its time for class action and antitrust suits. Google has already hurt small businesses with major algorithm changes, this is just another nail in the coffin. The economy is really bad and Google is only helping to make the problem worse. There are people who’s livelihood depends on Google search and throwing a plethora of ads in peoples face doesn’t make for a better search experience. Where is david when you need him to crush this goliath. I really wish there were better options and alternative in search.

      • http://goodzer.com sarapun

        “I really wish there were better options and alternative in search.”
        Well, f we’re talking specifically about product search then there are services with much bigger coverage that Google Shopping. I can name few examples such as http://goodzer.com or TheFind

        • http://www.pickmygift.com Rita Perdue

          The problem with ‘local’ store listing is – what if you are an ‘internet based only’ company and you want your products to be made available to the entire USA? How is someone in Maine or California going to know what is available from my site in Oklahoma if its only listed as “local” – 90% of our products are ‘made to order’ (to avoid excessive warehouse fees) and are unique – meanning they are NOT available in any local store. How will ‘local shopping sites’ help our businesses?

          • http://www.pickmygift.com Rita Perdue

            Well, just did a searh for ‘blue lamp’ on goodzer.com and the only results I got were from Walmart, Home Depot, Dollar Tree, JC Penny, Kmart and the like – with the FIRST 11 RESULTS ALL FROM WALMART ALONE – this site just puts all the BIG BOX stores next to each other showing the same products (all from China)… not really helpful for shoppers wanting unique stuff, just which big box store has it cheapest, but then there’s a target market for those people too, right?

    • http://www.theoutletseason.com/electronics Ric

      The problem I see with this model, is this another cost we have to swallow, on top of all the others we had to take in order to survive, that is giving free shipping, discounts over discounts, implementing several payment methods, and on top of all these now the Ads! Never been a fond of AdWords, or PPC I did a test on the peak of the holiday season and ended up losing over $900! why? Because prices were so crazy not many people buy and you also have to deal with increasingly smarter thugs who invent new ways to stole from you and end up in chargebacks! Google is no longer a friendly company it became an ad corporation that will surely start to fall if they continue with this route. For us AdWords is nonsense, and CPA we have to see because with over 60000 products its unaffordable to advertise everything … I think only deep pockets can afford this model in the long term. I am looking into alternatives. We have several stores and they have all been affected. I am confident someone will offer an alternative soon, or they will have a massive drop in advertisers …

      • norm

        Facebook screwed their investors wide-open and you think Google’s motto of don’t be evil stands? My motto is I’m a Billionaire. Nope. Didn’t work either. Takes more than words.

  • http://www.rush-it-uk.com Sam

    This will not give users the “best” results. Yet again we se google moving away from being a “search engine” and more towards being the internets largest paid directory.
    It would almost be more fair if they launched their own online sales platform that was paid on a commission bassis that would offer free choice to all in the market and be able to give the end user the real best results and google can be paid every time like they want.

  • Ken

    “We believe that having a commercial relationship with merchants will encourage them to keep their product information fresh and up to date. Higher quality data—whether it’s accurate prices, the latest offers or product availability—should mean better shopping results for users, which in turn should create higher quality traffic for merchants.”

    There are many small businesses that try to keep their product listings up to date. It’s sometimes difficult because they can’t afford a fulltime person to maintain the googlebase data, but plenty of larger stores seem to publish misleading advertisements on a daily basis. I doubt they’ll do anything to fix their data just because it costs them to list it. By turning this “service” into a pay-to-play service, they are basically handing all the business back to the big box chains, because the smb can’t afford to compete.

  • http://www.weddingaccents.com Kathy Crow

    I’m another small e-tailer who has been drastically hurt by Google’s newest algorithm changes. I have a niche market in wedding and life events accessories, gifts and party supplies and have had my site up and running for 14 years – not a fly by night. We always have provided great customer service and make every effort to get products to our customers when they need it. We offer over 3000 products. I started this business part time while I was employed in the defense industry as a way to have additional income and a retirement income. I am now semi-retired and depend on my ecommerce business to survive. The recession hit our business hard which was unforeseen… but to add insult to injury Google comes along in the last couple of years and builds an algorithm that wipes out most of what was left of our good ranking with a few exceptions. They may think they did this to offer better search results for the consumer but in reality all they have done is to allow a few large sites to monopolize the searches and give the consumer fewer choices unless they are willing to click through several pages of listings. Sites like Amazon.com never even offered wedding accessories until a few months ago and what they do offer is very limited by their associate retailers. They don’t even have a category for wedding items – yet when you type in “wedding veils” as a search term they come up in the top ten because they sell a book that has the word “wedding veils” in the title? How is that helpful to the consumer? Other sites now ranking for wedding related items are DHgate.com (almost totally Asia suppliers with prices no one in the US can compete with) and what bride in the US really wants to buy direct from China? There are some categories of search terms where the same large sites have several listings on page 1, 2 or 3 which totally eliminates the small retailers who may be offering much better prices or much wider selections. I don’t know if this is just a permanent change and all the small retailers will just have to fold up their tents and find something else to do – but this is not good for the US economy nor the consumer. Just my two cents!

    • norm

      Not just your two cents.. grow some balls and stand behind what you type, woman. America sucks because you are all afraid of your own convictions. Use Bing, or get banged, baby.

  • DixieGirl

    This is definitely going to hurt small e-commerce sites like mine and many already mentioned. Sadly we were just starting to get out of debt and make some progress with our sales using Froogle, and now we will not be able to afford this. We don’t even qualify as a Trusted Site because we don’t sell in excess of 100 order per 28 days. This is all about money and will squash out the little guys. Currently every product entered has to have a UPC, unless it is a custom item. It would seem Google has the power to sort things out that way and produce good search results, this is just an excuse. Great timing right before Christmas.

  • Jonathan

    Sad times. I’m not an e-tailer, just a simple consumer deeply disappointed in this turn of events. I thought google’s motto was “don’t be evil”? They are clearly failing.

    I have already seen a decrease in the quality and quantity of product search results and I’m looking into alternatives such as nextag.com, shopzilla.com, thefind.com, and pricegrabber.com. I hope one of these will work as well as froogle used to. I AM BOYCOTTING GOOGLE SHOPPING. Spread the word. People should know that google is putting profit over people. If we don’t express our outrage about this, most people will have to suffer worse product search results without ever knowing why.

    Notice: no positive comments about this change. Better results through “a combination of relevance and bid price”? BS!

    Fair and open markets make an efficient economy. It is scary how blatantly google is disregarding the interests of their users to make a buck.

  • http://www.autoblogbost.net/ friendly

    friendly-prices

  • norm

    Bottom line: Internet marketers are stupid. Especially those in California. Idiots run through billions in venture capital and cannot take on Google? Google should be banned, just like Internet Explorer, and only small business, marketers and developers have that power.

    What is also amazing is that Americans will sue over a bruise, but not one lawyer has the balls to go after Google. Wimps in America, i’m not surprised they are upset at Google banning weapon sales.. Americans think weapons can protect them from everything, hence, they lose time and time again.

  • http://rosespetsupplies.com rose

    Google shopping has sold out to big business. I guess you quickly forget what your original mission was once you have to satisfy share holders. Just increase profits, this is all that matters to them. The problem here is google can do it as almost every consumer in america thinks the internet is google. They have no idea. I for one am switching to bing as maybe Microsoft in their quest to un-seat google in something will keep it’s shopping free. Maybe consumers will start to use bing to find the real deals for their products.
    As a very small business I have no choice but to continue to seek out free venues to sell my products. It was bad enough having to continue to low ball price everything I sell to compete with the big boys but now their big pockets have won the war. I left e-bay because of the expense but maybe I’ll have to reconsider that decision as at least they only charge a small amount to list (sometimes it is free) and they only charge me when I make a sale. I can afford to pay for a real sale but this sucking money out of my small pocket just to get a click. Most of the clicks from google are people just browsing.
    I will be removing google payment option, not that google will care but I just can’t continue to pay someone whose sole intention is to put me out of business. You need to be a fairly large small business to continue to fight off these guys with large advertising budgets.
    But then no one really cares about small business anyway, just take a look at any main st. It was only a matter of time before the internet replicated the physical world. At least we won’t have to look at all the boarded up businesses this time.

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