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Google Makes a Shift for E-commerce

DesktopShipper
Posted by DesktopShipper on Apr 14, 2021 9:00:00 AM

 

As the world continues to change, e-commerce continues to grow.

Throughout the past year, e-commerce has flourished and grown while brick-and-mortar businesses struggled to stay afloat. As e-commerce develops, companies are trying to learn how to get a slice of the "digital world" pie. In the last 14 months, Amazon and Walmart have dominated the e-commerce space, but Google is looking to refocus the e-commerce conversation. 

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Search, Shop, Purchase

Traditionally, Google and other search engines were the places to search, shop, and find your favorite items. As popular marketplaces replace search engines for that first-stop-shop, Google has taken on an opposite approach. 

Though Google is successful in its own right, it is competing with a company where it's all marketplace, all the time. In 2020, Amazon's global advertising business grew 30% to $17.6 billion. As an e-retailer, most would naturally go to Amazon, which passed $295 billion in third-party goods in 2020. Juozas Kaziukenas, the founder of Marketplace Pulse, a research company, says the amount of goods people buy on Google is "minimal" by comparison to Amazon. This has lead to Google's pivot to direct sales advertising and organic search algorithms. 

Generally, if you are a seller on a marketplace, you utilize that marketplace to reach their direct consumers. While you get a larger consumer audience, the marketplace earns commission and fees for every purchased or listed item. Google has recently introduced its plan to flip this marketplace and business relationship by bringing consumers directly to merchant sites rather than turn Google into a marketplace itself. 

 

Benefits of Direct to E-retailers

The New York Times recently reported that "In the last year, Google eliminated fees for merchants and allowed sellers to list their wares in its search results for free. It is also trying to make it easier for small, independent shops to upload their inventory of products to appear in search results and buy ads on Google by teaming up with Shopify, which powers online stores for 1.7 million merchants who sell directly to consumers." 

Selling on Google is a huge benefit for small businesses looking to keep their already thin profit margins, even if you are using paid ads to leverage sales. According to Web FX, "The average business, for example, spends $9000 to $10,000 per month on Google Ads and earns $2 in revenue for every $1 they spend on Google Ads. If they focus on the Google Search Network, that amount increases to $8 for every $1 spent." Not only are you making a higher return on investment, but you are also now no longer paying extra listing and processing fees, which cut into profit margins. 

SEO Reigns Supreme

Still hesitant about investing dollars into Google? Check out the releases of their best practices for how to get your products noticed organically: 

 

Google is a powerhouse and offers excellent alternatives for small and large e-commerce sellers. Their plan may be an ambitious and strategic move for them, but it seems to be working, attracting more online sellers to their platform. The more sellers that focus their marketing and sales efforts on Google, the more they help existing sellers and consumers. While we don't know how this plan will pan out in the long run, we're excited to see Google put businesses first with low entry costs to sell online. 

 

Topics: Ecommerce News, Marketplaces

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