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Google’s Comparison Shopping Services: What’s changing for you?

Google-Comparison-Shopping-Services what-is-changing-for-you

Google Shopping CSS

Remember the €2.4bn antitrust fine the European Commission gave Google last year? Google since turned its product search into a comparison shopping service to avoid a shutdown of Google Shopping in Europe. The most recent measure by Google in this regard brings some financial benefits to advertisers in Google Shopping. 

If you’re an ecommerce business and you haven’t heard the buzz around Google Shopping’s CSS incentive program for merchants that has been around for a couple of weeks, the program is well worth a second look: expect a great opportunity for a better ROI. We’re talking BIG numbers.

CSS-Partner-Shopping-AdsCSS Partner Shopping Ads

The Google Shopping Game Changer

Let’s take a step back: For a while now, all Shopping ads appearing in Google’s main search results have been part of a Comparison Shopping Service (CSS). Google Shopping itself also acts as a CSS (“By Google”), taking part in the bidding auction, and competing with other CSSs who place bids on behalf of merchants to advertise their products. Customers will hardly notice the difference, the only visible change is the now added “By …” line ("Von…" in German) at the bottom of the ad.

What has changed is the price of a click: Google Shopping now takes about 20% off your bid as their margin. As other CSSs generally don’t charge margins, this means that their bids will be about 20% cheaper for you as a merchant:

Google Shopping CSS makes it possible to win the auction with lower bids

Google Shopping CSS makes it possible to win the auction with lower bids

This was the first step that Google took in September 2017 to comply with the European Commission’s ruling that Google needs to create a level playing field. Entering the auction was supposed to create equal opportunities for traditional comparison shopping engines and Google Shopping. Traditional comparison sites–the main complainant in the case is the UK-based vertical search company Foundem–were hoping for more visibility on the product search engine.

In reality, the situation did not change very much for traditional comparison shopping sites, their visibility did not improve noticeably. They were having a hard time convincing merchants to partner with them, forcing them to keep their margins very low.

As neither the EU nor the old comparison shopping sites were signalling that they’d accept these results, Google took further action to ward off another antitrust fine of €4bn. They started a generous incentives program for merchants that finally set things in motion:

Google’s incentives program SpendMatch

// UPDATE 4th October 2018: The incentives described below are only available until 31st October. From 1st November to 31st December all merchants will receive a fixed kickback of 5% of their spend on Shopping ads through a CSS partner.

In an attempt to accelerate the competition, Google has started to offer ad credits to merchants who move their products to a CSS Partner. Depending on ad spend, merchants receive up to €32.000 per month for the same traffic!

At the moment, advertisers certainly get a stunning deal out of the situation, so you better make the most of it! ;)

Existing Merchants

Monthly Ad Spend €500 - €2.500 20% ad credit
Monthly Ad Spend €2.500 - €10.000 25% ad credit
Monthly Ad Spend above 10.000 € 30% ad credit, up to €32.000 per month

New Merchants

New merchants partnering with a CSS get 100% Spend Match up to 500€ in the first month.

Careful, credits do not apply to clicks in the Google Shopping Tab! As most of the Google Shopping campaign traffic happens on the main search site, this will affect only a small percentage of clicks.

New Merchants

New Merchants

How can I participate as a merchant?

As an e-commerce business looking for a terrific deal on your CPCs, you will have to find yourself a CSS partner. You can choose freely between a traditional shopping comparison site, an agency or an ad-tech company doubling as a comparison shopping service.

Agencies and tech providers are pushing to start their own CSS to be able to continue to provide the best service to merchants advertising with them. Disclaimer: ADFERENCE Shopping is one of them. ;)

Once you’ve chosen your CSS partner, you simply provide your product data through a separate Merchant Center account that is created for you by your CSS partner. The CSS partner will then use the inventory in your Merchant Center to run Shopping ads on your behalf.

Decide on a strategy

Whether your strategy is to simply lower your ad spend and see the extra credit as a cost reduction, while your returns stay the same or whether you use the credit that is accumulating in your account to reinvest immediately and bid more aggressively is entirely up to you.

It is possible to partner with multiple CSSs–Google will do their best to show your product only once at the same search query. And no, you won’t second-price yourself. Let’s reap the benefits, while it lasts!

 

If you’re an e-commerce brand and you haven’t found your CSS Partner yet, let’s talk about how you can join ADFERENCE Shopping.

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