Google Shopping has been making headlines since its launch over ten years ago and is back on front pages this week as it prepares to introduce its much talked about ‘Buy Now’ button. Many are already celebrating the benefits that will come with the new feature and are anticipating a positive change for the online and mobile shopping markets but others are dreading the inevitable disadvantages. We look a little closer at why Google Shopping is splitting the crowd so evenly.

What is Google Shopping?

Google Shopping is something that has been around since 2002 but has fast become more prolific with the rise of the ecommerce and mcommerce generation. The online service allows consumersGoogle buy now button to locate products via the search engine and compare prices with other vendors. After early modification, the service was integrated with Google Search meaning listings could now appear alongside web results, which was great for retailers selling their products online.

Over the past thirteen years the service has undergone a number of different name changes and various reconfigurations, the most recent coming into force in 2012.  Formerly known as Google Product Search, Google Products and Froogle, the service, which was once funded through online advertising service AdWords, now charges vendors a fee to list their products. The facility is available in a number of countries across the world but it is currently UK SMEs that are feeling a financial pinch due to its rising prices.

It seems Google Shopping is the Marmite of the tech world

Pay-per-click agency Koozai recently ran a survey of 1,000 SMEs and what the results revealed was quite fascinating. The research shows that a majority of those surveyed are feeling the effects of a dramatic increase in costs of Google Shopping, with 65% agreeing that the expense has been rising for their businesses. Nearly 40% of the 65% that are of this opinion say costs has increased between 30% and 40%, and 20% say costs had increased between 20% and 30%.

However, 62% of the small and medium-sized enterprises questioned believe that despite the cost increase, Google Shopping still provides a satisfactory ROI for their business. Business owners also still seem to be preferring the Google Shopping service over the general Google Search Network which accounts for all of the web pages and apps that products can appear on.

Marketing director at Koozai, Samantha Noble points out that due to the rapid growth that Google Shopping is currently experiencing, competitor demand is also increasing, which means prices are forced to rise. She said: “It is a platform that is designed to attract buyers that are at the point of sale making the ROI potential really significant if the campaigns are executed and managed correctly. Many businesses are finding that Google Shopping gives them a better return on investment than the traditional Google Search Network.

“This backs up a lot of research that shows shopper intent plays a large part in making Google Shopping successful.

“I am looking forward to seeing how Google Shopping campaigns perform with all the additional features that have been added in the run up to the busy Christmas holiday season when shopping sales will be at their peak.”

The elusive ‘Buy Now’ button

The highly-anticipated Buy Now button has been in talks for a little while now but it has been confirmed this week that the new facility is good to go. Any day now in fact so businesses, brace yourselves for a feature which is expected to increase the efficiency and popularity of online shopping.

The Buy Now button will work like this: when a user comes across a product through searching via Google, they can click the button and be taken to a separate Google-built page where they can complete a purchase. Customer bank details will be stored in a Google Wallet, which means the company is in full control of the payment process. Google will reportedly not be taking a percentage of the transaction and instead, will reap the financial benefits through charging vendors a per-click advertising fee to list their products.

The button has been designed specifically with mobile shoppers in mind and has the potential to completely transform the mcommerce market. With the use of the feature, customers will no longer need to visit the vendor’s respective website to purchase a product meaning there will be a substantial simplification of the transactional process. It will also increase security measures as bank details aren’t shared on hundreds of different sites.

However, while this is great for customers, it will likely have a negative effect on the amount of traffic directed to vendors’ websites and creates a certain distance between them and the customer. The button might also spell trouble for SMEs who can’t afford to splash out the same large budget on paid clicks that larger companies can, which is just another issue that is causing a divide between those championing Google’s new feature and those contesting it. In fact, 40% of those surveyed during Koozai’s research claim that the Buy Now button will be bad for business and a mere 27% believing it would have a positive impact on sales.

What do you think? Are you an SME owner who feels like Google Shopping is having a negative impact on your sales, or are you amongst those feeling the benefits for your ROI? Let us know by tweeting us @teamorganicuk

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