Brief:

• Google will stop charging merchants a fee to list products on its Google Shopping search pages as the coronavirus pandemic makes e-commerce a vital sales channel for retailers forced to close their brick-and-mortar stores, the search giant announced in a blog post Tuesday.
• Starting next week, search results on the Google Shopping tab will mostly show free listings from merchants, even those that don’t advertise on Google’s search platform. The change will give online retailers free exposure to millions of people who use Google for shopping-related searches.
• Advertisers can augment their campaigns with free product listings, making them easier for Google Shopping users to find. The free listings are available to existing customers of Google’s Merchant Center and Shopping ads, and the company is working on making the onboarding process for new customers easier, per the blog post. Google also announced a collaboration with digital payments company PayPal that will let merchants link their accounts.

Insight:

Google’s removal of product listing fees for online merchants is a positive development for mobile marketers seeking to reach shoppers through the world’s most popular search platform. For brick-and-mortar retailers whose sales have been devastated by the pandemic, the free product listings may provide a lifeline as homebound shoppers use apps and websites to order products for delivery or pickup. 

“This is a positive development for retailers in the short term, as they can expect to see a lift in volume of [about] 4% from their Google Shopping channel. Any support during COVID-19 is welcome for retailers,” Alex Harmon, senior director of partnerships at Adlucent, said in emailed statements to sister publication Mobile Marketer. “The announcement can also be viewed as another indicator that Google is invested in developing [its] Shopping property into a more robust consumer experience. As it matures, it offers a more compelling destination for advertisers and consumers alike.”

For Google, the move is important as the company likely faces declining ad revenue as marketers suspend or delay media spending. It’s also a sign that the search giant is taking on Amazon and other digital retailers in the market for e-commerce advertising as the coronavirus pandemic squeezes supply chains.

Google has faced a growing threat from Amazon’s push into the digital advertising market, leading some marketers to reportedly shift as much as 50% to 60% of their search budgets from Google to Amazon in recent years. Amazon has become the most popular starting point for product searches as well, per researcher Jumpshot.

To beat back that growing threat, Google is working to build stronger relationships with existing merchants while onboarding new ones more quickly. Along with the announcement of the free listings, the tech giant reinforced its continued work with e-commerce partners like Shopify, WooCommerce, and BigCommerce. 

Google’s latest move builds on recent efforts to convert passive users into active shoppers while also diversifying its revenue beyond digital advertising. The company added a shopping section in January that lets mobile users see a variety of clothing and accessories products from multiple online stores in another bid at expanding e-commerce support. Google in October also introduced a redesigned version of Google Shopping that included features like price-tracking, which followed efforts that brought new ad formats to the Shopping tab.