Amazon started as online book store and has grown to be the worlds largest online retailer.
Amazon cancels Google Product Listing Ads
Amazon has pulled all it’s budget from Google Product Listing Ads. It appears that as of the end of April Amazon simply stopped spending money with Google across all device types and they’ve not reappeared yet, although it has only been a fortnight.
Merkle Inc broke the news and it may be seen as an indicator that Amazon don’t want to be buying competitors ads as they ramp up their own advertising offerings to retailers including Amazon Sponsored Products.
“It’s hard to guess at why Amazon changed course, just as it was never totally clear why Amazon refused to participate in Google Shopping for several years. The wide breadth of its product offering, competitive pricing and ever expanding group of Prime members make it a formidable competitor.”
– Andy Taylor, Merkle Inc
Amazon have only been paying for Google Product Listing Ads for about 18 months since late 2016 and it’s not entirely unheard of for advertisers to pull campaigns – one sure fire way to measure the effectiveness of your ad spend to pause ads and see if it makes any difference to sales.
For ecommerce merchants to view this news means that you’ll no longer have to bid against Amazon for your own products and should perhaps consider stepping up your own ad spend in the short term. It may also play into eBay’s hands as they still appear to be spending on Google Product Listing Ads so may benefit from Amazon’s withdrawal.
With Amazon accounting for some 35% of all UK ecommerce we wouldn’t expect cancelling Google Product Listing Ads to have a significant impact on their sales – Prime customers tend to use Amazon for mundane routine purchases without shopping around or price checking. Amazon’s adverts on Google are more likely effective for consumers who don’t already shop on Amazon or for existing customers who weren’t aware a particular product could be purchased on the Amazon marketplace.
There are two additional factors which might be playing into this decision.
The first is that Amazon and Google have been getting into quite a conflict over each others’ products. Amazon refused to stock Google products (Nest, the Google Home Speaker, the Chromecast box etc) and removed access to Amazon Prime from Chromecast, while Google have removed YouTube from Amazon Fire devices. So this move is just another way for Amazon to try to hurt Google in the pocket.
The other is that despite trying to persuade us otherwise, Amazon is still bound by business realities, and over the last few months appears to have shown signs that in other companies would have analysts saying they were tightening control over cashflow. There was the spectacular fall-over in their disbursements system last October and November (just after Jeff Bezos cashed out $1Bn of shares), the imposition of retentions on all new accounts and any older ones with other than staller metrics, pushing the B2B market where sellers are effectively having to offer free credit to buyers, and SFP where sellers directly pay for the shipping costs on Amazon’s most iconic offering.
I’ll be interested to see how Google responds. I wouldn’t be surprised if they start finding ways of downgrading Amazon within search results while simultaneously accelerating their so far very tentative moves to expand Google Shopping from a search engine to a genuine marketplace.
Really good reply @alonicus ! Yes I agree with you!
Interesting article and supports another article https://marketingland.com/amazon-poised-to-launch-new-retargeting-ad-product-report-240119 about Amazon soon to launch into retargeting and display – tackle the customer higher up the funnel so that the product search is done on Amazon rather than Google.