Beginning next week, businesses that want their products to appear at the top of Google search results will have to pay for it. Etsy, an online marketplace for handmade goods, will be among them.
The Brooklyn-based startup hosts shops for more than 800,000 sellers and has generated $500 million in sales so far this year. It’s investing more than $250,000 in Google Product Listing Ads through the end of 2012 “to make sure sellers aren’t negatively affected [by Google’s changes] during the holiday season,” a spokesperson for Etsy wrote in an e-mail to Mashable.
All Etsy sellers with at least one active listing will be indexed – about 15 million items in all – at no additional cost to them. UPDATE: Only the listings of U.S. sellers will be indexed. Etsy could not provide an exact number.
In late May, Google announced that it would be rebranding Product Search as Google Shopping, and that organic Product Search results would be replaced by paid listings come Oct. 1 in the U.S., and in Europe and Asia next year. Results will still be ranked largely by relevance, “with bidding as an additional factor,” a Google spokesperson told Mashable. Natural results will still appear below sponsored results.
Here’s what Product Search looked prior to May (via Google):
Here’s what it looks like today (note the “Sponsored” tag):
And here’s how Google Shopping will look come Oct. 1 (via Google):
Why is Google making the change? In a blog post, Sameer Samat, VP of product management at Google Shopping, said the company believes that if merchants are paying to have their products appear, they’re more likely to keep their product information accurate and up to date.
Google is no doubt hoping that if it improves the quality of its product search results, shoppers will make Google – rather than Amazon – their first stop for online shopping. In a Forrester survey of 4,000 U.S. shoppers released in July, more than twice as many said they began researching their last online purchases at Amazon (30%) versus Google (13%).
Not all retailers are happy about the changes, of course – they are now being charged for a service they once enjoyed for free. The change may seem especially painful for small business owners, but Google says merchants can pay for listings based on clicks or on purchases made on-site, which does even the playing field.
Frank Harris, product manager for search and advertising at Etsy, says he’s been studying the traffic from Google Product Searches since May, and found that it was effective for reaching shoppers who weren’t previously familiar with Etsy. He isn’t sure if the investment will simply maintain Etsy’s current rankings or improve them, but he did say that “historically we were able to syndicate only a fraction of the marketplace, and now we’re working closely with Google to get the entire marketplace into product search.”
Shop owners will be able to track how their Google listings are performing in terms of click-throughs through an analytics dashboard (see above). If the ads perform well, it’s possible that Etsy could begin charging sellers for them later. Last year, the company introduced an ad product for its own site search, allowing sellers to purchase placements in highlighted sections on search results pages. Harris says Etsy “hasn’t decided on anything past spending a quarter of a million dollars for the end fo the year,” but said the company “will talk to the community in early 2013 about next steps.”
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