What Google Shopping Means for Online Retailers and Amazon

With Google's search engine market share hovering near 70 percent, it comes as no surprise that the search giant plans to revamp its current e-commerce function to further wedge itself into the online shopping industry. Google has already started transitioning the old Google Product Search to the new Google Shopping, a commercial e-commerce marketplace allowing participating merchants to sell their products directly to consumers.

Details about Google's new platform have leaked over the summer, leading to plenty of speculation about what this move means for online retailers. With inevitable changes on the way, it's crucial for online merchants to understand how Google can drastically alter the e-commerce world and, more importantly, how to prepare for these changes.

What's Google Shopping?
Unlike Google Product Search, Google Shopping requires merchants to buy product listing ads in order to sell on the site. This has created a major uproar across the industry. Google defends its case by explaining that a paid model will guarantee up-to-date product listings, and thus an improved shopping experience for online consumers, who are expected to spend $327 billion annually in the U.S. alone by 2016.

Google's new product listing ads serve as information-rich pay-per-click ads, offering detailed product information, current pricing and photos. Whether a retailer's listing pops up in search results or not depends on the item's relevance to the user's search, combined with the bid price. The most relevant products will be displayed with the associated image and information based upon a shopper's query. Shoppers will also be able to use special filters to tailor results to fit their preferences — e.g., if they're after free shipping or a specific brand.

Is Google Shopping the Next Amazon?
As Google takes the e-commerce plunge, it's impossible not to wonder what this means for Amazon.com. After successfully taking on the smartphone powerhouse Apple, it's easy to say that Google is one of the top, if not the contender to take on the online marketplace leader.

With Amazon offering the same services for free, retailers might shy away from Google Shopping at first. Advantage Amazon. But with Google's core competency being web search — and so many retailers pining for search engine optimization value — opinions are bound to change.

The online shopping process is often initiated with a simple search query for whatever pair of shoes, DVD or gadget the consumer might be looking for. With Google Shopping, the entire decision process happens within Google's interface, eliminating the time-consuming process of hunting through dozens of sites to find the right product at the desired price. Yes, shoppers are still required to pay via the merchant's website, but knowing Google, this will likely change. Advantage Google.

Similar to Amazon's "Featured Merchant" opportunity, Google Shopping allows participating sellers to apply for a "Google Trusted Stores" badge (through a much simpler process, too). Rather than proving fulfillment of an array of Amazon-set criteria, all merchants have to do is place a Google code on their website, which tracks their shipping and customer service for 28 days. All retailers are evaluated on those two criteria, no matter the revenue or product offering. After the four-week period, approved sellers are awarded with the title and an icon that's displayed next to their name in the marketplace.

What's Next?
There are a few preparatory steps you can take now if you're considering integrating Google Shopping into your e-commerce strategy.

As Google continues to make cosmetic tweaks to the site, consider starting small. Purchase listings for two or three of your best-selling products, or ones that are holiday favorites. Monitor their success to determine if Google Shopping is an appropriate fit for your audience and business. You can always add more listings if it's a boom or cancel your current ones if it's a bust.

Purchasing product listings alone, however, won't guarantee success. You must also adjust your website to help facilitate the program. If you haven't already, submit a shopping feed of your site to Google. Next, ensure that your product pages are fully optimized to enable Google's crawlers to find your listings. Relevancy is key in determining whether your ads appear in search results, so double and triple-check that your products include all necessary keywords and tags. If your e-commerce platform allows, use a keyword cloud to confirm that you're highlighting the right terms.

As with most of Google's consumer-facing projects, Google Shopping can't be ignored. Google has already set the standard for all things search; whether it's trying to raise the e-commerce bar or not remains to be seen, but the company's track record shows that no matter its intentions, its actions are worth paying attention to.

Diane Buzzeo is the founder and CEO of Ability Commerce. Diane can be reached at dianebuzzeo@abilitycommerce.com.