Redfly Online Marketing, Dublin, Ireland

Google To Become The World’s Biggest Search Affiliate?

I am rarely one for conspiracy theories or donning tinfoil hats but a word of warning, a lot of this post is conjecture. With that disclaimer out of the way, I would like to discuss a trend that I have noticed with the paid side of Google AdWords. I wrote recently about Google flushing out affiliates that use AdWords. A lot of people didn’t agree with me yet Google published an update just days afterward to it’s “website types to avoid” document about the exact topic. A lot of commenters made the very valid point that Google owns and operates it’s very own affiliate network.

The biggest revelation that was drawn from this and the subsequent thread over on WebmasterWorld was that Google was flushing out even the “highest quality” affiliates. They were even flushing out direct linking affiliates that were advertising with the parent merchants consent. I wont go into the rights and wrongs of all this, it’s been done to death on the WMW thread already and I do not want to discuss the whole Google Vs Affiliates topic again either. What I do want to point out is what happened next.

On Wednesday, November 11th, the Inside AdWords blog announced Product Listing Ads. Product listing ads are image ads that appear along with the “normal” sponsored listings on a Google search result page except they have images, merchant name and prices associated with the ad.

Pay only for results: Product Listing Ads are charged on a cost-per-action (CPA) basis, which means that you only pay when a user clicks on your ad and completes a purchase on your site. Because Product Listing Ads is charged on a CPA basis, it offers a risk-free way for you to reach a larger audience on Google.com.

While this is still in very limited beta it’s quite interesting. I was wondering how Google would go about charging merchants the CPA. I’m not sure how long this has been a feature in Google Merchant Center, but you can now link your AdWords account to your merchant center account.

You can now specify your AdWords account information in your Google Merchant Center account. By doing this, you can surface your product information in your AdWords ads. AdWords campaigns that are linked to Google Merchant Center accounts will receive the benefit of richer, more specific product information in their creatives; including images and prices.

You can add multiple AdWords accounts to a single Google Merchant Center account. To do this, simply enter your AdWords Customer ID under Add an AdWords Customer ID: and click Add. Once you’ve entered your AdWords Customer ID in your Google Merchant Center account, you’ll need to create a Product Extension within the Campaign Settings section of your AdWords account and link it to your Google Merchant Center account.

So now Google is allowing merchants to link their product feeds to AdWords and set a price they want to pay for each sale? Isn’t that what a PPC affiliate does/Used to do? Only this time, Google being the owner of the search engine can offer what no other affiliate can, images and branding directly in the search results.

Could it be that Google flushed out all the affiliates to make room for the merchants that it is promoting on a CPA basis? What if Google were to allow it’s affiliate network merchants opt in to product listing ads? All their feeds, data, images and prices are already uploaded to the network. Couldn’t/Shouldn’t Google start displaying product listing ads in the search results for it’s own merchants and getting a nice juicy CPA for it? Doesn’t this make sense? Google has all the data it needs to display the most profitable product ads too. Affiliate marketing is a multi billion dollar industry. Why wouldn’t they get on board? Especially if it compliments their existing search results. It appears that others have come to the same conclusion. Google have since announced more AdWords bans and in typical Google fashion, refuse to communicate clearly.

Google has just announced a whole slew of new ad formats, is slowly making organic results less visible and now with product listing ads is monetizing the remaining space above the fold. It’s also worth noting that this month, Google also released DFA analytics. It’s all mounting up.

Don’t get me wrong, I think this is great for merchants and I am a firm believer that Google can and should do what they want with their own search engine. I am also not sounding the death knell of affiliate PPC marketing. I do however believe that PPC affiliates are going to be up against a pretty powerful 800 Lb Gorilla in the very near future.

I’d like to end with a quote over on WMW by the very wise Netmeg (You should follow her on twitter too):

But nothing pisses me off more than seeing all the talk about how Google has destroyed your business. Google has NOT destroyed your business. If your business cannot survive without Google, then YOU have destroyed your business..

…Google is not responsible for the success or failure of your business. YOU are.

I was wondering why Google was flushing affiliates out of the AdWords system and not so much the organic results. This is, in my opinion, a possible reason why. Google is making room for itself. Time to focus a little more on paid search? What do you think?