Google Shopping to Become a Paid Service

Google recently announced major changes to its shopping business that will most likely prove extremely controversial with a high number of online sellers.

Later in 2012 product search results within Google Shopping will be influenced by how much retailers and advertisers are willing to pay for the visitor. In the past, this service was completely free and the results were firmly based on relevance to the searched term.

This change will firstly be rolled out in the United States but it is expected that the change will take place in the UK during the early stages of 2013.

Sameer Samat, the Vice President of Product Management at Google Shopping said:

“"We are starting to transition Google Product Search in the U.S. to a purely commercial model. This will give merchants greater control over where their products appear on Google Shopping."

For over a decade Google Shopping has been a free service as Google made its money by running paid advertising via Adwords alongside the organic (unpaid) listings within its search results. However, it is now expected that Google will now extract a much greater level of revenue from retailers

In America, Google Shopping drives around £420 million in annual sales and around $1.3 billion worldwide but now Google are set to see these figures increase rapidly over the coming years.

It is estimated that the changes will cost retailers an extra $270 million globally to fill the sales hole, however it is expected that the new Google Shopping program will actually help retailers make their products more visible to their target audience when compared to the old system.

This ultimately means that retailer’s sales levels could increase in future, whilst the paid system might see some of the clutter fall out of the results which is a positive result as long as you are one of the companies that can afford the advertising costs.

Google Shopping is expected to become a paid service in America during October 2012 and then rolled out worldwide during the early part of 2013.