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The Transformation to Free Product Listings on Google Shopping

An evolutionary change for Shopping Ads on Google is upon us, yet many searchers will never notice the difference.

For the first time since Froogle, effective immediately, Google is allowing unpaid product listings on its “shopping properties” (the Google Shopping Tab). You heard that right, free product advertising on Google Shopping! No need to create a new feed, just ensure you are opted-in to “surfaces across Google”.

Why make this change?

The answer is two-fold. In the short-term, amidst this COVID-19 pandemic, Google wants to help businesses combat the decline in brick and mortar sales. This change offers all brands the opportunity to sell on Google Shopping, without the need for investment in ad spend. The update was scheduled for later in the year and would have most likely been a slower roll out, but in response to the challenges in the retail sector due to the coronavirus pandemic, Google advanced their plans.

From a long-term perspective, this is the next phase in competing with Amazon. Products on Google Shopping are no longer limited to brands with big budgets, allowing new and unique products to be displayed, which may better suit consumers' needs, creating an improved user experience and increasing the likelihood of a purchase. In addition, Google added PayPal to its list of eCommerce partners, opening the door to future advancements and the possible expansion of “Buy on Google”, a feature where the user completes their purchase without ever leaving the Google Shopping property. Via increased relevancy, increased conversion rate, and decreased barriers to entry, Google is hedging their bets that over time, this will create a behavioral change away from both their large eCommerce competitors and their new social eCommerce competitors.

For the consumer

As a result of the lowered barrier to entry for retailers (zero cost), consumers will get more choice in product selections due to the increased number of brands on the page. However, there is another factor which increases consumer choice. With large retailers, typically, only about 30% of their feed inventory is displayed due to the nature of Paid Advertising and the drive for efficiency in spend. For the other 70% of inventory, the performance metrics simply did not make Google Shopping a viable solution. For example, the cost of listing a $4 nail glue in Google Shopping outweighs the potential profit so advertising would need to be paused. However, Unpaid Product Listings open up this 70% of inventory as there is no cost. The consumers truly benefit from this update, getting more variety both in overall brand as well as individual product selection.

But what does this mean for you as a retailer?

There will be an impact to Performance, Reporting, and Optimization, but it is up to you to ensure it is a positive impact.

Performance – The Paid Media real estate on Google Shopping properties will be dramatically reduced. Similar to the removal of the right rail ads in 2016, we can predict that this will lead to instability in product visibility (ad position and impressions) and inflating CPCs, as advertisers battle for the limited ad slots which remain. These limited ad slots will be housed in their own carousel at the top of the page while the new organic listings will populate underneath. However, it is worth remembering that there is now an abundance of free listings to take advantage of, so the potential increase in CPC will likely be offset by the free clicks elsewhere on the page. Additionally, as it stands, the majority of paid traffic still flows via the traditional SERP on Google.com, which remains unaffected by this change.

With new products, more choice, and possibly lower price points, CTR could potentially drop. Google’s plan is to increase product relevancy for the consumer by allowing free product listings thus directly competing for that all-important “click”. While CTR is an advertising metric, what you, as a retailer, truly care about is qualified site traffic. This change may allow your brand to serve in both a Paid slot and a Free slot, therefore increasing the likelihood of incremental site traffic, offsetting any decrease in CTR. Also, at the present time, the majority of traffic is via the SERP which remains unaffected.

Reporting – Currently, reporting for the Unpaid Product Listings sits within Google’s Merchant Center and exclusively focuses on clicks. For tracking and analysis purposes, you will likely want to enable auto-tagging or build custom click parameters. It is important to note that organic clicks will be aggregated together in one-line item. Google is working on the ability to segment data by category, product, and brand. As Google Shopping becomes more comparable to marketplaces like Amazon, it will be beneficial for retailers to aggregate metrics to share insights and inform strategy. Reporting will remain challenging in the short term. However, we must bear in mind this was an accelerated roll out by Google and that more functionality is to come over the next few weeks and months.

Optimization – This update opens the doors to a new and exciting world of Shopping Feed SEO. Like Google Shopping Ads, these new unpaid listings will be powered by a product data feed managed through Google Merchant Center. We previously mentioned that CPCs are likely to increase, CTR may possibly decrease, and the best way to combat these from an overall business perspective is by maximizing visibility in the unpaid slots but this is a challenge without a robust data feed solution.

The quality of your product data (paid and organic) is directly correlated to higher visibility on the SERP so your feed set-up matters now more than ever. A “functional” feed is not enough to drive success. But what differs between a functional feed and a best-in-class feed? Merchant quality, product data quality, and user engagement are three of the most important factors, but are also just the tip of the iceberg.

From an Organic and Structured Site Data standpoint, there are a few elements that should be considered essential:
The feed should use only Canonical URLs to avoid pulling information from the wrong version of a page.
Schema Markup should be utilized and must match the contents of the page.
○ Pricing Schema should be considered, especially for any sale price items

Retailers need to consider developing a technology-based frame of thought that outlines a strategy to achieve performance goals, layered into the role and impact of data feed solutions to arrive at that destination.

While we expect results of this evolution in Google Shopping to be relatively small in the short term, we believe Google will now look to establish innovative ways to increase traffic, thus increasing the impact, both positive and negative. Unpaid Product Listings are valuable for Google, helpful for the consumer, and can be beneficial for brands as long as marketers monitor performance, optimize toward the data, and increase focus on feed based optimization. Amend these practices immediately to future-proof yourselves and truly reap the benefits.