O Google tried to copy the manual from Amazon to become the center of internet shopping, with little success. Now, you’re trying something different: an anti-Amazon strategy.
Google wants to present itself as a cheaper and less restrictive option for independent sellers. Its focus is on driving traffic to vendor sites, not selling its own version of products like Amazon does.
In the past year, Google has eliminated merchant fees and allowed sellers to offer their products for free in their search results. In addition, it is trying to facilitate the upload of products to small independent stores, so that they appear in the search results, and to simplify the purchase of ads by joining Shopify, which feeds online stores of 1.7 million merchants who sell directly to consumers.
However, like many of Google’s attempts during the two decades it competes with Amazon, it shows little sign of working. Google has nothing quite as enticing as the $ 295 billion traded by Amazon’s marketplace in 2020. The amount of goods that people buy on Google is very small in comparison – probably around $ 1 billion, according to founder Juozas Kaziukenas from research firm Marketplace Pulse.
Amazon is almost an accessory in the lives of many Americans. It has usurped Google as the starting point for shopping and has become equally essential for marketers. Amazon’s global advertising business grew 30 percent to $ 17.6 billion in 2020, second only to Google and Facebook in the United States.
However, as the pandemic has forced many stores to sell online, a new loophole has emerged for Google to win over sellers who prefer not to link their businesses to Amazon.
Christina Stang, 33, opened Fritzy’s Roller Skate Shop near Pacific Beach, San Diego, California, in March 2020. With the lockdown, she decided to set up an online store on Shopify.
And he was lucky. I had a huge supply of skates when demand increased, because many skating videos became popular on TikTok during the pandemic.
Stang linked his Shopify account to Google’s commerce software and started buying so-called smart shopping ads. Working with a predetermined budget, Google’s algorithms choose where to place ads and which products to present. She said that in 2020, she spent $ 1,800 on these ads, which were viewed 3.6 million times and generated $ 247,000 in sales.
Stang considered selling his products on Amazon’s marketplace, but he feared that Amazon’s fees would further lower his meager profit margin. He also liked the fact that Google redirected people to his carefully crafted website, instead of keeping them in the store itself, as Amazon does. “I could sell on Amazon and not make real money, but have a bigger online presence. It didn’t seem like a good idea.”
Recently, however, she experienced one of the disadvantages of being stuck in the middle of the partnership between Google and Shopify. Your store has been unable to offer any products since January because Google suspended its account, claiming that its shipping costs seemed more expensive on Google than on its Shopify website, even though they were no different.
Shopify informed you that this was a Google problem. Customer service representatives recommended that Stang hire a web designer. She continues to work without Google, but it has affected her largely positive experience. “I’ve been hurt. I’m a small business and I don’t have hundreds or thousands of dollars to resolve this.”
Sellers often complain about Amazon’s fees – which can account for a quarter of every sale, not to mention the cost of advertising – and the pressure to spend more to succeed. Amazon merchants do not have a direct relationship with their customers, limiting their ability to communicate with them and generate future business. And, as everything is contained in the world of Amazon, it is more difficult to create a unique look and express the identity of a brand as companies do on their own websites.
However, since 2002, when he started a price comparison engine called Froogle, a confusing “frugal” word game that demanded a brand overhaul five years later, Google has struggled to draw a cohesive vision for its shopping experience.
He tried to challenge Amazon directly by designing his own same-day delivery service, but canceled the project when costs increased. He tried to forge partnerships with traditional retail giants, but ended up seeing the alliances fall apart due to lack of sales. He built his own marketplace to facilitate the purchase of articles found on Google, but he was unable to break the habit that consumers have of using Amazon.
Last year, Google hired Bill Ready, a former PayPal chief operating officer, to fill a new senior position and lead a review of its purchasing strategy.
At the time of his hiring, Sundar Pichai, chief executive of Google, warned senior executives that the new approach could mean a short-term decline in advertising revenue, according to two people familiar with the conversations, who asked not to be named because they did not. they were allowed to discuss them publicly. He asked the teams to support the e-commerce measure, because it was a priority for the company.
When the pandemic spurred a huge demand for online shopping, Google eliminated fees, allowing sellers to offer products for free and rescinding a 2012 decision that allowed only advertisers to display goods on their shopping website.
Three months after hiring Ready, Google announced that the offers would appear in its top search results for free. He then said that customers could buy products directly from merchants on Google without commissions. He also assured that he would open his platform to third parties, such as Shopify and PayPal, so that sellers could continue to use their existing tools to manage stocks and orders and process payments.
The partnership with Shopify was especially significant because hundreds of thousands of small businesses joined the software platform during the pandemic.
Harley Finkelstein, president of Shopify, said the company was developing, with Google, new ways for merchants to sell through search engine services, taking steps such as allowing customers to buy items directly on YouTube and display on Google Maps the products offered by the stores.
Ready was on a tightrope when it came to Amazon, which is a big ad buyer on Google, but made it clear that he believed her domain in e-commerce posed a threat to other merchants. “Nobody wants to live in a world where there is only one place to buy things, and retailers don’t want to depend on that type of website,” he said in an interview.
Google said it had increased the number of stores appearing in its results by 80 percent in 2020, with the most significant growth coming from small and medium-sized businesses. And existing retailers are offering more products.
What is still unclear is whether the increase in the number of merchants and products on Google will change online shopping habits.
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